Synlait chief executive Grant Watson says dairy commodity prices had strengthened as a result of this ongoing demand.
Synlait Milk Limited has increased its forecast base milk price forecast for the 2021-22 season to $9.25/kg milksolids from $8/kg MS.
Synlait chief executive Grant Watson said dairy commodity prices had strengthened significantly as strong global demand has outrun restricted supply.
“As seen in most commodities, covid-19 is having a significant impact as illness and lockdowns impact production and supply chains. This has been amplified by rising production costs driven by strong inflation and ongoing pressure on our industry to decarbonise,” Watson said.
The milk price is also benefiting from a weakening New Zealand dollar against the US dollar.
“As a result of this ongoing demand, Synlait believes dairy commodity prices could remain high for some time as these dynamics will take time to unwind, supporting the record milk price forecast released today,” he said.
Synlait’s next milk price announcement will occur in May.
