Fonterra farmers are in line for one of the biggest milk price payouts in the co-operative's history.
The dairy giant has raised and increased its farmgate milk price range to be between $7.90 and $8.90-per kilogram of milk solids for the 2021/2022 season, up from between $7.25 and $8.70.
Fonterra chief executive Miles Hurrell says the higher forecast range is the result of strong demand for dairy products at a time of limited supply, especially from the Chinese market.
He says mid-point of the new range would equal the previous record set back in 2014 and would see $13 billion pumped into the rural economy.
It's well above Fonterra's target of an average milk price payout of between $6.50 and $7.50 per kilo of milk solids.
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