Ann: Appendix 4C Commentary, page-269

Yes and Fonterra Australia has provided its opening season price well above the MGC's price maker FGMP price. The deferred 40 cent incentive offered by Fonterra is a bit quirky though as they are caught up in the MGC's MSSP write-off due to the rather elusive and tenuous Bonlac Supply Agreement arrangement for pricing against MGC's price.

The benefit of AHF, or at least should be, is that they are not tethered to the FGMP by the very nature of being their own supplier of milk with only seasonal variations needing to be made up by external supply that they can secure through ACM (Australian Consolidated Milk). In theory this is perfect but in reality I do not believe this is operating optimally for AHF at the moment and in fact may well be costing the company from both a supply into and from a supply from the wholesale milk market. Something else that no-one has dug deep on and would be very hard to do short of an independent audit but the financials do give some insight.