Warrnambool Cheese and Butter Factory (WCB), the Australian dairy group, has cut the milk price it pays its suppliers amid the fall in dairy commodity prices on world markets.
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WCB’s move comes after fellow dairy firms Murray Goulburn and Fonterra reduced the milk prices they pay to suppliers.
Last month, WCB warned that the slump in dairy prices would be likely to lead to a fall in its annual profits.
Since then, the company said, trading conditions in its key product categories had continued to decline.
“WCB is currently not able to determine whether dairy commodity prices have bottomed or not due to the considerable uncertainty that continues to exit in global markets,” WCB said in a trading update to the Australian Stock Exchange today (20 January).
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By GlobalDataThe company said it would cut its milk prices from 1 February to 30 June. The cut would equate to a reduction of around of 12% on an annualised basis based on the opening price advised to WCB’s suppliers last June, the company said.
