Sunday, July 3, 2022

Burra Foods pushes up the milk price

Australian dairy ingredient processor Burra Foods has increased the price it is paying suppliers for this season’s milk.  Burra Foods processing plant is located in Gippsland in the south east of Victoria, Australia’s main dairy producing state.  

Chief Executive Officer, Grant Crothers announced the AU$0.08 kg fat and $0.20 kg protein step up in a letter sent to all Burra Foods’ farm milk supply partners last week.  

The increase of 13 c/kg of milk solids comes on top of the AU$5.25 to $5.65 kg MS opening price for this season announced by the Gippsland processor last month.

In confirming the price increase Mr Crothers confirmed the increase in price is a direct result of Burra Foods’ business model capturing the increased returns available in export markets.

“The key indicators continue to be favourable and anticipate the higher prices to hold across the larger volume supply months of November and December flowing directly on to higher farm gate milk prices.

The depreciation in currency is the icing on the cake and should make 2013/14 a marquee year for the farm gate milk price”, Mr Crothers said.

"The depreciation in currency is the icing on the cake and should make 2013/14 a marquee year for the farm gate milk price”

Grant Crothers

CEO Burra Foods

The strong opening prices and this step up announcement comes at a time when many dairy farmers across Gippsland are assessing options to supply their milk for the current season.    

While he resisted in providing a year-end forecast, he did acknowledge that further step ups would become available once the business had a complete understanding of how volumes of the Oceania spring season impact will the market.   

Mr Crothers confirmed the Korumburra based processor is continuing to grow milk intake and the business.  “This ensures we remain in a sound financial position to again provide above average industry returns for our farm milk supply partners”, he said.

Burra Foods primarily produces dairy ingredients but recently commenced the modification of the Korumburra plant to expand their manufacturing capability to include Nutritional milk powders.  The plant is expected to be ready to manufacture Nutritional milk powder including Infant Formula, by the mid 2014.

Burra Foods expects to process more than 275 million litres at the Korumburra site next season.

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