Milk price system

The milk price that our member dairy farmers receive for each 100 kilos of milk comprises four components:

1) Guaranteed price

FrieslandCampina has two guaranteed prices: a guaranteed price for farm milk from regular farms and a guaranteed price for farm milk from organic and biodynamic farms. In both cases, the guaranteed price is the price that the company guarantees to pay member dairy farmers for the farm milk they supply. The guaranteed price reflects the average farm milk price to be paid by a number of dairy companies in North-West Europe, including supplementary payments, registered reservations, seasonal supplements, quantity supplements, maximum quality supplements, and cooperative supplements or charges. The amount for regular farms applies for an average supply of 1,000,000 kilograms of farm milk and for organic and biodynamic farms for an average supply of 600,000 kilograms on annual basis and is paid out in the milk components: protein, fat and lactose, in a fixed ratio of 5:4:0. The guaranteed price is published per 100 kilograms of farm milk, at 3.57% protein and 4.49% fat, exclusive of VAT.

2) Duties and premiums

Various cooperative deductions and premiums are settled with the monthly milk money. An example of this is a fixed cost deduction. In addition, for Foqus planet Sustainable development, € 0.60 per 100 kilograms of milk is deducted. This amount is supplemented by the company. As a result, the amount that the dairy farmer earns within Foqus planet Sustainable development based on sustainability efforts can amount to € 3.50 per 100 kilograms of milk.

The allowances for Foqus planet Sustainable development per theme:

• For the Animal Health and Welfare theme, this is a maximum supplement of € 0.20 per 100 kilograms of milk.
• For the Climate component (greenhouse gas emissions) this is a maximum allowance of € 1.50 per 100 kilograms of milk.
• For the Biodiversity theme, this is a maximum allowance of € 0.50 per 100 kilograms of milk.
• For the Grazing theme, this is a maximum payment of € 1.30 per 100 kilograms of milk, with full grazing.
• Members receive a payment of € 0.40 per 100 kilograms of milk for partial outdoor grazing.

The premiums within the Foqus planet premium depend on the scores of the farm on the various indicators of Foqus planet Sustainable development.

The company FrieslandCampina contributes the difference between the total payments and the total deductions within Foqus planet Sustainable development. For example, for outdoor grazing, the company contributes € 1.00 per 100 kilograms of milk to the outdoor grazing premium of € 1.30 per 100 kg of milk.

Participants of the special milk flow On the way to PlanetProof are rewarded in a different way for their results within Foqus planet Sustainable development (as part of the special milk flow), via a fixed On the way to PlanetProof allowance (see below).

In addition, FrieslandCampina pays member dairy farmers a quantity bonus for milk delivered above 1.5 million kilograms. This is € 0.50 per 100 kilograms. Members who deliver milk from multiple locations are combined together for the quantity bonus.

3) Premium for special supplements

Within FrieslandCampina there are special milk flows for which milk must meet special requirements. Member dairy farmers who supply this milk receive a premium for this. Currently, there are four special milk flows for which members receive an extra bonus. These are: milk with the On the way to PlanetProof quality mark (€ 5.00 per 100 kilograms) and Organic Dynamic milk (€ 4.10 euros per 100 kilograms).

4) Cash subsequent payment and interim payment

Member dairy farmers of FrieslandCampina share in FrieslandCampina’s net profit through a cash supplementary payment. The cash supplementary payment depends on FrieslandCampina’s financial results and the established reservation policy. Of the company’s net profit, 40 per cent is paid out to the member dairy farmers as a cash supplementary payment, while 60 per cent is added to the company’s equity.

By no later than 1 October, an interim payment may be made on the basis of the company’s results and the volume of milk delivered. The interim payment amounts to 75 per cent of the pro forma cash supplementary payment for the first half of the year. In practice, the interim cash supplementary payment has been shown to lead to undesirable situations. For example, in 2020 it was reclaimed from member dairy farmers because FrieslandCampina had paid out too much and the second half of the year proved to be less profitable. In 2024 and 2025, it was also decided not to make an interim payment due to uncertain market conditions.

General disclaimer

As a precaution FrieslandCampina informs you that there are risks connected to the milk certificates, member certificates, member bonds-fixed and member bonds-free. These are subordinated claims. FrieslandCampina has the right, but not the obligation, to repay the milk certificates, the member bonds-free and the member bonds-fixed and the interest payments for the member certificates, member bonds-fixed and member bonds-free can be suspended under certain circumstances. The member bonds-fixed and non-tradeable. The milk certificates and the member bonds-free are limited tradeable on the internal market of FrieslandCampina provided that there is sufficient demand. These financial instruments cannot be regarded as ordinary investments because of the afore-mentioned and other risks connected to them. It is important that this is taken into account by the current and future holders of these instruments.