The Commerce Commission today published its final report on its annual review of Fonterra’s Farmgate Milk Price Manual
for the 2020/21 dairy season (Manual), which contains Fonterra’s methodology for calculating its base milk price.
This year’s review focused on the changes Fonterra has made to the Manual since last year. These include moving the
responsibility to independently review certain aspects of the milk price calculation to the Milk Price Group, and the
introduction of the ability to apply the outcome of a ‘Within-Period Review’ to the year in which the review is
undertaken.
The findings of the final report are unchanged from the draft released in October.
We are satisfied Fonterra’s manual is largely consistent with both the efficiency and contestability dimensions of the
purpose of the base milk price monitoring regime.
The Commission will review how Fonterra applies the Manual when it assesses the 2020/21 base milk price calculation at
the end of the current dairy season.
The final report and related information can be found here.