Protein trend boosts Fonterra's results

Fonterra recorded a significantly higher profit for the 2025/26 financial year. The New Zealand dairy cooperative benefited from the sale of the Mainland Group, but underlying results also improved. The final milk price has been set at NZ$9.69 per kg of milk solids.Fonterra posted revenue of NZ$27 billion. Operating profit came to NZ$3.4 billion, almost double the level recorded a year earlier. Net profit rose by 142% to NZ$2.6 billion. These figures include a gain of NZ$1.2 billion from the sale of the Mainland Group.Even without this effect, results improved. Underlying operating profit rose by 23.6% to NZ$1.8 billion. The ingredients business in particular performed strongly, helped, according to Fonterra, by strong global demand for proteins, favourable prices and product mix choices.Higher dividendThe final milk price for the 2025/26 season has been set at NZ$9.69 per kg of milk solids. The dividend is also higher. Fonterra will pay a total of NZ$0.73 per share for the financial year, compared with NZ$0.57 a year earlier. This includes a special dividend of NZ$0.16 following the sale of the Mainland Group.Following the sale, Fonterra is focusing more strongly on business-to-business activities. The cooperative says it will invest an additional NZ$1 billion in the South Island over the next three years, including in expanding production capacity for proteins.Milk price forecast slightly lowerFor the 2026/27 season, the forecast milk price is NZ$9.50 per kg of milk solids, with a range of NZ$8.50 to NZ$10.50. This is slightly below the final milk price for the past season. In explaining the lower forecast, the cooperative points to continuing geopolitical uncertainty.