Lion Dairy & Drinks has announced competitive opening pricing for direct milk suppliers for the 2016/2017 season (1 July 2016 to 30 June 2017).
Lion’s farm gate milk pricing offer compares favourably to competitors and Lion is confident that this pricing is a compelling mix of reward and security for dairy farmers.
Since 2013, Lion has offered its dairy farmers in the southern region (Victoria, Tasmania and South Australia) a broad range of fixed and variable farm gate pricing options for contracts of varying lengths (one, three or five years) that help farmers to better manage market volatility. Lion farmers have a choice of:
- variable pricing underpinned by a minimum pricing guarantee;
- fixed pricing for those who prefer a set and determined price; and
- an option to combine fixed and variable pricing.
Lion’s fixed term contract options continue to enjoy strong take-up, with the majority of southern region farmers opting to secure all or part of their pricing for up to three years. Due to the carryover of fixed contracts from past seasons, Lion expects to pay the majority of its direct farmers in 2016/2017 in the southern region the net weighted average price of $5.67 per kilo of milk solids.
This price represents a premium of 27% over the forecast opening price announced by the price setter in the southern region.
In the southern region for 2016/2017 our three (3) year fixed price is $5.50 per kilo of milk solids, while the one (1) year fixed price is $5.10 per kilo of milk solids and the one (1) year variable price is $5.00 per kilo of milk solids. These prices are based on standard 7.2% milk solids.