ON WEDNESDAY, May 7, Saputo Dairy Australia advised its suppliers of a step up in minimum milk price of $0.15 per kgMS for the 2024/25 season.
This step up increases the weighted average farmgate milk price from $8.30 - $8.45 per kgMS for exclusive supply in the Southern milk regions (being Gippsland, South-West Victoria and South Australia, Northern region and Tasmania).
SDA said the payment will be made with April proceeds during May and automatically applied to all qualifying milk supplied under the firm’s published exclusive milk supply agreements from July 1, 2024.
Kate Ryan, Director of Milk Supply and Planning said SDA remained committed to paying a competitive milk price.
“During the current season, we’ve seen continued stabilisation of commodity prices for the start of calendar year 2025. Meanwhile, domestic market challenges persist as cost-of-living pressures impact the local trading environment. Consumers remain cost sensitive and value focused,” Ms Ryan said.
“As we look to the 2025/26 season ahead, the outlook for domestic and global demand remains uncertain and volatile, with geopolitical tensions and inflationary pressures still impacting purchasing activity.”
Meanwhile the Global Dairy Trade rallied broadly on May 6, 2025, with cheddar cheese up 12%, butter up 3.8%, and Whole Milk Powder up 6.2% with other categories either neutral or making modest gains on a rising trend since the start of April.
As near-term futures improved, USDA forecasts warn of softer annual averages due to milk production expansion later this year. Global factors like EU cheese prioritisation and Chinese tariffs add complexity, leaving producers balancing short-term gains against long-term supply risks.
It leaves everyone guessing about where Australian processors will start the new milk year on June 1, but suppliers in regions challenged by dry conditions will be looking for a strong indication upfront if they are to keep production levels up.
