Fonterra flags challenging environment in fiscal 2024

 Fonterra said it was unclear whether strong demand for milk seen during recent global trade events would continue in the financial year 2024.

"Farming is a long-term game and as an exporter, we need to accept that we are impacted by demand and supply dynamics, commodity prices and geopolitical events," chairman Peter McBride said.

Last month, the company raised its farmgate milk price forecast for fiscal 2024, after cutting the forecast range twice earlier.

Global dairy prices in recent months largely recovered off lows seen in August after Chinese buyers returned to the market.

However, unusually warm weather conditions from the El Nino weather phenomenon have raised worries about impact on dairy industry.

Fonterra said that medium-term outlook for its New Zealand dairy market remained positive, even as it expected a marginal fall in milk collections during 2024.

For key export markets, aggregate milk growth in 2024 is expected to be below average, according to the company.