Fonterra confirms 2016/17 forecast Farmgate Milk Price

23 FEBRUARY 2017

FONTERRA CONFIRMS 2016/17 FORECAST FARMGATE MILK PRICE

Fonterra is required to consider its forecast Farmgate Milk Price every quarter as a condition
of the Dairy Industry Restructuring Act. For this purpose, Fonterra Co-operative Group
Limited today confirmed the forecast Farmgate Milk Price of $6.00 per kgMS announced in
November.

When combined with the forecast earnings per share range for the 2017 financial year of 50
to 60 cents, the total pay-out available to farmers in the current season is forecast to be
$6.50 to $6.60 before retentions.

Fonterra Chairman John Wilson says the Co-operative is confident that this forecast is at the
right level, following the 75 cent rise in its forecast Farmgate Milk Price in November last
year.

“The global outlook for dairy remains positive. Since November, the global market for
commodity dairy products has remained relatively balanced and we expect global prices to
continue to hold or gradually increase over the back half of this season – a view shared by
most global analysts,” said Mr Wilson.

Fonterra also announced that it would increase the monthly Advance Rate it pays to
farmers. The Advance Rate for February, paid in March, has increased to $4.85 per kgMS.

“Our confidence in the global dairy market at this stage of the season, combined with the
strength of our Co-operative, has enabled us to increase the monthly Advance Rates more
than we normally would at this time of the year,” said Mr Wilson.

Fonterra’s Global Dairy Update for February reported that the Co-operative’s New Zealand
milk collections were showing signs of recovery. Originally expected to be down seven per
cent for the season, the New Zealand collections forecast has now improved to a five per
cent decline on last season.

ENDS

For further information contact:
Simon Till
Director Capital Markets
Phone: +64 21 777 807