Chair/Board/Management/shareholders/stockwatchers,
That below suggests Coles (and no doubt WOW) have set milk prices for the next 2-3 years.
BFC Press indicates that BFC is at $9.42kgMS today.
Will BFC have to,
1. increase FY22/3 prices from July 1 2022?
2. match Coles price/s??
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Coles bids to contain spiralling milk prices

Farmers are being offered record prices for their milk but Colesis taking a longer-term view to shore up supply and help steady the cost at thecheckout.

By JARED LYNCH

Coles said price rises and longer contracts providedfarmers income certainty while securing the supermarket chain’s milk supply.Picture: Bloomberg

From Agribusiness

January 26, 2023

3MINUTE READ

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Coles has offered dairy farmers steep price increasesunder longer-term contracts in an effort to shore up the supply of its privatelabel milk and keep sticker prices steady until 2025.

Food prices are outpacing broaderinflation, putting further pressure on manufacturers to lift prices, which threatens to unleash more hip-pocket pain at supermarket checkouts.

Coles began sourcing milk directly from farmers four years ago for its private label varieties, giving it more control of its dairy supply chain. It wrote to farmers this week offering to pay up to 22c more a kilogram of milk solids under “tenure payments” to entice them onto three-year contracts in an effort to smooth out price volatility and contain further spikes.

Coles general managerfor dairy, freezer and convenience products, Brad Gorman, said price rises andlonger contracts provided farmers income certainty while securing thesupermarket chain’s milk supply.

“Coles introduced a direct sourcing model for our ownbrand milk in 2019 to ensure we could provide fair, competitive and guaranteedfarm gate prices to dairy farmers directly. These longer-term contracts offerfarmers greater security of income so that they can invest back into theirfarms and make them more sustainable,” Mr Gorman said.

“This tenure payment is to recognise and reward ourlong-term dairy farmer partners who have been working under this model. Thedirect sourcing model also ensures we can provide our customers with greatquality locally sourced milk for the long term.”

Coles will also pay farmers in key dairy regions an extra8c per kilogram a month, taking the farm gate price to $12.05 a kilogram byJune 2025. This compares with average farm gate milk prices across Australia’ssouthern export regions ranging between $9.50-$10 a kilogram for milk solids.