Fixed Milk Price (FMP) offering oversubscribed as farmers flock to lock in returns.
More than 500 Fonterra farmers locked in a net $9.60/kg milksolids for some of their 2026 season production in the April Fixed Milk Price event.
The Fonterra offer of 25 million kilograms on April 7 and 8 was oversubscribed after 547 farmers applied for 27.4 million kg.
Under new FMP rules whereby 10% oversubscriptions can be accepted, the total volume of applications was signed up.
The first offer of the new season in March saw almost 300 farmers apply for nearly 15 million kg at $9.53 net price, all of which was contracted.
Fonterra milk supply director Lisa Payne said more and more farmers are participating in FMP, including those who are in the early stages of their careers.
“We have offered FMP contracts since 2019, because we know some of our farmers want the option of having greater certainty for a portion of their revenue.
“This includes farmers who are just starting out, and in March and April we have seen new farmers that will start supplying from June utilising the service.
“It’s great to be able to support the next generation of farmers who may require a greater level of certainty in their farm income.”
Payne said all Fonterra farmers can benefit from the FMP scheme, not just those who participate.
“It enables us to offer price risk management solutions to key customers that value price certainty for the products they source from us.
“The premiums we earn from those contracts flow through as improved earnings, which can then be returned to farmer shareholders in the form of dividends.”
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