Fonterra Global Dairy Update Signals Price & Supply Trends

Fonterra Co-operative Group has posted its Global Dairy Update for January 2026, highlighting ongoing shifts in global milk supply and market dynamics amid sustained dairy production across major producing regions. While detailed commentary in the update itself is limited, broader dairy price trends show strong milk flows putting pressure on farmgate price forecasts in key markets like New Zealand, where Fonterra has narrowed its forecast milk price range for the 2025/26 season, reflecting abundant global supply and competitive conditions.

The co-operative’s farmgate milk price midpoint for the season has been adjusted around NZ$9.50 per kilogram of milk solids, as global milk collections remain robust — a sign that dairy commodity markets are balancing supply with continued demand even as price volatility persists.

Fonterra’s broader strategy also includes divesting non-core consumer businesses to focus on its commodity processing and global ingredients footprint, with farmers approving the sale of its consumer brands — including Anchor and Mainland — to French dairy giant Lactalis, a transaction expected to complete in early 2026.

Amid these structural shifts, the co-operative’s update underscores the interconnected nature of milk supply, price forecasting and strategic portfolio realignment as global dairy players navigate a complex demand environment — where plentiful milk output co-exists with competitive raw material markets and evolving pricing pressures.

Source : Dairynews7x7 Jan 31st 2026 Reuters

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