Fonterra Australia has slashed its milk price to farmers and warned more severe cuts are to come.
Fonterra managing director Bruce Donnison sent letters to 1,500 of its suppliers last week stating the company had withdrawn its November step-up payment of 7c/kg butterfat and 17c/kg protein.
The letter states: “Since writing to you in early November, we have seen a further deterioration in trading conditions”.
“Commodity prices continue to decline and this has been exacerbated in recent weeks by a rapidly deteriorating financial situation around the world; a deterioration which has far exceeded even our most pessimistic expectations,” the letter states.
In the letter Mr Donnison warned: “Our forward expectations for the remainder of the season remain below any previous outlook”.
“Consequently we are in the process of reviewing our pricing levels for the February to June 2009 period.”
The announcement follows dairy giant Murray Goulburn’s pre-Christmas announcement that it would cut prices to its suppliers by an average of 26 per cent from February 1.
The decision sent shock waves through the dairy industry, given it was the first time since the 1980s that any milk processor had cut prices mid-season. Other company’s are soon expected to follow MG’s lead with Warrnambool Cheese & Butter declaring it would make an announcement in January.
3 Comments on “Fonterra Cuts Price to Suppliers”
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Mercy S. Panganiban
M.P. Lizardo Trading
Tel. No. (63 2) 2427285
Fax No. (63 2) 2439841
Cell No. (63) 9189079345
(63) 9228328759
Dear Sir / Madam,
We found your name and address through the internet as one of the best supplier of Dairy Products.
In this connection we would like to introduce ourselves to you that M.P. Lizardo Trading formerly Prime Commercial is an established Trading, Indent Import and Export firm since 1951. We shall be working with you on the basis of 1% to 2% commission based on whatever quantity of sales that could be made.
Payment will be always be made by a confirm and irrevocable at sight to be opened by our buyer upon receipt of the confirmation of the order or as agreed upon.
Shipment will be made within the life of the L/C which is usually from 30 to 60 days validity.
Should you be interested on our proposal. Please do send us your catalogue and price quotation based on CFRC1% Manila for presentation to our buyers.
Please quote your firm offer on 50 to 100 MT Skim Milk Powder Dairy America brand base on CFRC1% Manila and Cebu.
Thank you and awaiting your immediate response.
Very truly yours,
Mercy S. Panganiban
M.P. Lizardo Trading
Tel. No. (63 2) 2427285
Fax No. (63 2) 2439841
Cell No. (63) 9189079345
(63) 9228328759
Dear Sir / Madam,
We found your name and address through the internet as one of the best supplier of Dairy Products.
In this connection we would like to introduce ourselves to you that M.P. Lizardo Trading formerly Prime Commercial is an established Trading, Indent Import and Export firm since 1951. We shall be working with you on the basis of 1% to 2% commission based on whatever quantity of sales that could be made.
Payment will be always be made by a confirm and irrevocable at sight to be opened by our buyer upon receipt of the confirmation of the order or as agreed upon.
Shipment will be made within the life of the L/C which is usually from 30 to 60 days validity.
Should you be interested on our proposal. Please do send us your catalogue and price quotation based on CFRC1% Manila for presentation to our buyers.
Please quote your firm offer on 50 to 100 MT Skim Milk Powder Dairy America brand base on CFRC1% Manila and Cebu.
Thank you and awaiting your immediate response.
Very truly yours,
Mercy S. Panganiban
M.P. Lizardo Trading
Tel. No. (63 2) 2427285
Fax No. (63 2) 2439841
Cell No. (63) 9189079345
(63) 9228328759