Dairy farmers are in line for a bumper payout from Fonterra this year.
The cooperative has been telling farmers to expect a payout of more than $7 a kilogram for milksolids for the 2007-08 season, despite an easing of dairy prices and the strong Kiwi dollar. The 2006-07 payout was $4.46.
In December, Fonterra forecast a payout of $6.90 a kg this year - but at its latest round of farmer meetings, which finish today, it has been telling farmers to expect more. Its official forecast is expected early next month.
The payout has been boosted to record levels as increased world demand for dairy products has pushed prices up.
Westpac agri-economist Doug Steel said the bank was sticking to its payout forecast of $7.20.
Fonterra has also been telling farmers to plan for a reduced 2008-09 payout - thought to be in the $5.50 to $6.50 range, still well above recent years.
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