Warrnambool Cheese and Butter (WCB) has announced a price rise for dairy suppliers.
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A step up of 12 cents per kilogram of butterfat and 30c/kg of protein brings the average payment to $5/kg milk solid for the 2016/17 season.
WCB general manager Richard Wallace said the payment was retrospective and would apply to milk supplied since July 1 this year.
The announcement was made on Wednesday, September 28 in a letter to all WCB dairy farmers and comes as a result of “a slowdown in global milk production” and “relatively stable” demand.
“Despite these positive signs we maintain a cautious approach as there is still volatility in global markets,” Mr Wallace said.
“We will review the milk price again in January 2017.”
Mr Wallace said the company would continue to closely manage “things that are in (its) control”, implementing the corporate strategy and diversifying the revenue base into consumer products.
“In this environment, average closing prices remain difficult to predict and remain dependent on the many external factors,” he said.
Unlike larger processors, WCB maintained their 2015-16 milk price despite a reported profit loss of 88 per cent in May.