Fonterra Lifts Milk Price Forecast to $9.50

Fonterra has lifted its forecast milk price for the 2026/27 season, raising the midpoint from $9.25 to $9.50 per kilogram of milk solids.

The co-operative also narrowed its forecast range, moving from $8.00–$10.50 per kgMS to $8.50–$10.50 per kgMS. The revision, announced Monday, reflects stronger global dairy commodity prices over recent months.

CEO Richard Allen pointed to improved results at Global Dairy Trade auctions since the last update in July, with whole milk powder and skim milk powder both performing better. Demand globally has remained strong.

Allen said the improved outlook reflected continued delivery from Fonterra's B2B businesses, but struck a cautious note. With only two months of the season complete, he said geopolitical volatility remains a factor and previous seasons have shown conditions can shift.

For Southland dairy farmers, the revised midpoint represents a meaningful improvement on where the season started. At $9.50 per kgMS, it sits well above the bottom of the forecast range and gives producers a firmer basis for planning — though Fonterra's retained range still leaves room for movement in either direction.