4 Mar 2011

Dairy prices continue to rise

9:30 am on 4 March 2011

Dairy prices have continued to rise, with the price of whole milk powder reaching a record high.

Fonterra's latest fortnightly online auction shows average prices jumped 6% to more than $US4800 a tonne. Whole milk powder prices surged 10%.

Strong international dairy prices led Fonterra last week to lift the payout for the current season to farmers to between $7.90 and $8 a kilogram of milk solids.

Global dairy trade manager Paul Graves says the price is high, but points out that many buyers may have purchased their requirements for this period months in advance.

Mr Graves says there is no evidence at present that the Christchurch earthquake has had an impact on the price.

Meanwhile, Fonterra says it has more than doubled its contribution to the earthquake relief effort.

The dairy co-operative says its farmer-shareholders have donated more than $1 million, which it will match dollar for dollar.

Together with the $1 million pledged last week, it brings Fonterra's total donation to $3 million.