February 26, 2020 / 8:53 PM / 3 months ago

Bad weather leads New Zealand's Fonterra to cut 2020 milk collection forecast

FILE PHOTO: The Fonterra logo is seen near the Fonterra Te Rapa plant near Hamilton August 6, 2013. REUTERS/Nigel Marple/File Photo

(Reuters) - The world’s largest dairy exporter Fonterra (FCG.NZ) on Thursday cut its milk collection forecast for fiscal 2020, citing adverse weather conditions in several parts of New Zealand.

The company lowered its expectation to 1,515 million kilograms of milk solids (kgMS) from the prior forecast of 1,530 million kgMS.

While it maintained its full-year adjusted earnings guidance and farmgate milk price range, the company flagged “significant risks” in the second half from the coronavirus outbreak.

“We have already contracted a high percentage of our 2020 financial year’s milk supply and this is helping us manage the impact of coronavirus,” the company said in a statement.

Fonterra said it would provide a further update on the impact of the epidemic on its business when it releases its interim results next month.

Reporting By Rushil Dutta in Bengaluru; Editing by Arun Koyyur

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