Synlait Milk Raises Milk-Price Forecast to NZ$8.60 per kgMS

Highlights:

• Forecast Increase: Synlait Milk (NZX: SML) raised its base milk-price forecast to NZ$8.60 per kgMS, a 60-cent increase from its previous projection.
• Competitive Edge: Synlait’s new forecast is 10 cents higher than Fonterra’s midpoint of NZ$8.50 per kgMS, positioning it competitively in the dairy market.
• Cautious Approach: Despite the forecast rise, Synlait is maintaining a conservative outlook, reflecting market uncertainties and strategic priorities.

Synlait’s Revised Forecast

Synlait Milk  (NZX: SML) has announced an increase in its base milk-price forecast to NZ$8.60 per kilogram of milk solids (kgMS), reflecting a 60-cent rise from its earlier projection. The revision places Synlait’s forecast slightly above Fonterra’s midpoint of NZ$8.50/kgMS. The company emphasized that, despite the increase, it is maintaining a cautious outlook given market uncertainties.

Competitive Pricing with Fonterra

Synlait’s upward adjustment comes shortly after Fonterra revised its own forecast and payout schedule nearly two weeks ago. The competition between the two major players continues to shape the dairy industry, with both companies closely monitoring market trends and global dairy prices. Synlait’s forecast increase is a critical move as it aims to stay competitive and support its suppliers amid fluctuating market conditions.

Strategic Priorities and Market Outlook

This marks the first adjustment Synlait has made since issuing its initial forecast in May, during which the company stated it would take a conservative approach to its pricing strategy. Synlait’s leadership remains focused on navigating market volatility and ensuring sustainable growth, with this pricing decision aligning with its long-term strategic goals. The company will continue to monitor global dairy trends and make necessary adjustments as the season progresses.

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