Article: High dollar to block larger payout

Dairy farmers believe the high dollar might deflate hopes for a heftier payout, even though there has been spectacular growth in dairy commodity prices over the past few weeks.

Market analyst NZX Agrifax has tracked a "meteoric" rise in international commodity prices. Butter has jumped 10 per cent and skim and whole milk powders 4% in United States dollars.

Signs of panic buying were emerging, with one price for skim milk powder reaching nearly $US5000 a tonne. The 10-year average is $US1900.

Farmers, however, are cautious of this translating into a higher payout than the record $5.53/kg of milk solids forecast by Fonterra

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