KEY POINTS:
Fonterra will announce its latest payout forecast for the dairy season to May 31 at lunchtime today.
The existing record forecast of $6.90/kg milksolids means the giant cooperative's 10,711 farmer shareholders will receive an average payment of more than $700,000.
When Fonterra was headed for an expected milk production of 1.25 billion kg milksolids - on a par with last season - farmers were set to pocket $8.6 billion - an average of $806,000 each.
But analysis by agricultural economists of the cost of the 2007-08 drought says it will take $894 million from expected dairy earnings - an average of $79,400 for each dairy farm.
The extent to which the national economy benefits further from the final payout will depend on not only whether Fonterra raises its forecast tomorrow, how the national milk collection was affected by the drought.
For individual farmers, a lot will depend on the extent to which they were hit by drought, whether they coped by paying top dollar for extra feed, and the extent to which they have made economies of scale by owning two or three farms.
Many farmers have speculated that the final payout figure will be closer to $7/kg.
Confusing calculations is the fact that Fonterra is changing its balance date from May 31 to July 31.
The 2006-2007 payout was $4.46/kg, and Fonterra's previous record payout, $5.33/kg in 2002, was worth $6.14/kg in 2007 dollars.
- NZPA
