Fonterra Shareholders Fund
(ASX:FSF) says farmers have pulled back on milk production, which could lead to a downward revision of forecast volumes later in the season.
However, the milk company says it has maintained milk volume forecasts for 2015-16 at 1.59 billion kilograms of milk solids, which is 2 to 3 per cent lower than the volume collected last season.
Fonterra says farmers are responding to the lower farm gate milk price by returning to more traditional farming practices, by reducing the use of feed supplements and lowering stocking rates per hectare.
Weather conditions will also be a factor affecting the amount of milk produced.
In the 6 months ended 31 January 2015, Fonterra reported a net profit of $183 million.
