The diary giant announced its weighted average farmgate milk price on Monday and estimated a closing price range of $6.55 to $6.95/kg MS for the 2021-22 season.

The strong price and early announcement is down to good market conditions and strong business performance, according to managing director Rene Dedoncker.

“Some of our domestic and export contracts are due to be settled later this month, so we will review this price when these are finalised and to ensure we remain competitive, as we will, in line with market and business performance throughout the season,” he said.

Mr Dedoncker said Fonterra was also working with farmer representative body the Fonterra Australia Suppliers’ Council on a new pricing structure for the upcoming season.

“Our new pricing allows farmers to farm the way that suits their needs with a choice of base rates to suit their milk curve, and also gets cash on farm as early as possible with changes to our incentive structure,” he said.

Bulla Dairy is the only other processor to announce its 2021-22 price so far, with a $6.40/kg MS to $6.90/kg MS opening range.