The Milk Price Calculator will be launched today at the United Dairyfarmers of Victoria’s annual conference in Melbourne.
Milk2Market commercial development general manager Richard Lange said the Milk Price Calculator provided farmers with a “transparent and credible source of farmgate milk prices and payment information”.
Mr Lange said dairy farmers input their monthly milk volume, fat and protein percentages, the region in which they operate and whether they want a one, two or three year deal.
He said the calculator provided a spreadsheet of farm income and comparative overview of companies’ farm gate milk prices in about six minutes.
He said the information provided to farmers accounts for milk payments for both flat and seasonal farming systems.
Mr Lange said the price calculation allowed for base milk prices, step-ups, growth incentives, productivity incentives, stop and volume charges and levy deductions.
The net income reports for each dairy processor are provided on either a dollar a kilogram milk solids basis or in cents a litre.
Mr Lange said the Milk Price Calculator could be used for comparing processors’ opening milk prices in a bid to determine which company to supply, or as a monthly budgeting tool.
“It gives an idea of farm cash flow,” he said.
“Farmers were then able to work out their feed needs.
“They can also work out the impact of step-ups.
“Our goal is to see a better informed milk market.”
Mr Lange said farmers should not necessarily chase the highest price computed by the calculator.
“That’s because it may not suit their farming system,” he said.
Mr Lange said the calculator was “not 100 per cent accurate all of the time” but was as accurate as it could make it.
“We are only going to get more and more accurate as we move forward,” he said.
Milk2Market is offering the Milk Price Calculator service free to farmers.
Mr Lange said the company was building a milk exchange where dairy farmers could trade a portion of their milk.
That was expected to be completed by the end of the year.