Fonterra’s milk collection across New Zealand in September was 8.7% lower than September last year and for the four months to September 30, it was 5% behind the same time last year.

According to the co-op, farmers continue to reduce stocking rates and supplementary feed to help reduce costs in the low milk price environment.

This in turn has resulted in lower production for the 2015/16 season to date, it stated.

In New Zealand, milk volumes are approaching the seasonal peak which is forecast for mid-October 2015.

While milk collection in New Zealand is down, Fonterra milk collection from Australia increased by 1%.

The rate of milk production growth from the major exporting countries has eased as farmers globally respond to lower dairy prices, according to Fonterra.

Dairy exports remain strong for Australia and Europe but the United States is down largely, which Fonterra attributes to increased domestic demand.

However, it stated that demand growth is being seen in Asia, China is returning to steady import growth, while the Middle East and Africa have slowed.

Fonterra’s credit rating downgraded by Standard and Poor

Fonterra’s credit rating has been downgraded by rating agency Standard and Poor from A to A-.

In response, Fonterra’s Chief Financial Officer Lukas Paravicini said that the New Zealand dairy giant’s underlying financial strength and credit quality remain strong.

“This is recognised by Standard and Poor’s maintaining our rating in the ‘A’ category and reflects our fundamental strength and financial discipline.

“It is important to note that the revised rating will not have any impact on Fonterra’s strategy or on farmer shareholder payout,” he said.