BNZ lifts milk price forecast to $10.25/kgMS for 2025-26
A stronger than expected outlook for dairy has prompted one bank to lift its 2025-26 season forecast milk price by 75c to $10.25/kgMS.
According to the latest Bank of New Zealand (BNZ) Rural Wrap report, the answer is maybe.
The report states that beef and lamb prices have risen over the past four months, with beef up 16% and lamb up 21%.
“We say this not to suggest that prices are strong, far from it in lamb’s case, but rather to acknowledge some changing dynamics of late,” the report states. “Rising prices at this time of year is not unusual, but the gains over recent months have been a bit more than normal.”
According to the bank, part of the price gain is due to a tightening domestic supply, as evidenced by recent strength in store markets. However, there have also been pockets of price improvement on the export market.
“In NZ, lamb and cattle slaughter numbers have dropped significantly below year earlier levels, tightening local supply and putting upward pressure on prices.”
The report states that an early kill, especially for lamb, saw slaughter numbers for both lamb and cattle tracking around a third below figures for a year earlier in July.
Despite the price rises, beef and lamb find themselves in two different positions from a historical perspective.
Lamb prices are low and are currently approximately 13% below their five-year average. Meanwhile, beef prices are at record levels, about 14% above their fiveyear average.
