New Zealand dairy giant Fonterra has said global demand and prices for dairy commodities are stable and the cooperative expects prices will remain at current levels in the short-to-medium term.
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Jay Waldvogel, Fonterra’s chief operating officer, told a media briefing on the outlook for dairy markets that price stability was positive news viewed in the context of a high New Zealand dollar and the expected currency impact on payout in the next two seasons.
“Markets appear to be acting rationally at the moment. Fonterra’s view is that prices are accurately reflecting supply levels and major players in the market are calmly watching signals such as export volumes, global currency movements and stock levels. Overall, product demand is good, and we are expecting prices will stay at around the same levels through 2004.
“If indeed prices remain stable in the medium term, this should provide some protection from the negative impact the high NZ dollar will have on next season’s forecasted payout,” he said.
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