Farmers face big drop in dairy cash

Fonterra will this week make an unscheduled update to its forecast which could cut payouts to farmers by more than $350 million. The next scheduled update was in December but a Fonterra spokesman confirmed there would be an announcement on Friday. Company policy is to make public adjustments when forecasts change by at least 30c. Based on last season's collection of 1.19 billion kg of milksolids, which was down 4.3 per cent because of the drought, a cut of 30c in the forecast could cost farmers $357 million.The National Bank expected the payout to be below $6 by the end of the season. "But the thing also to stress is that a $6 payout on an historical basis is still a very good result," Wilson said, reports The Herald