Dairy prices have risen for the first time in two months in the latest global auction.
Photo: AFP
The average price was up 2.7 percent to $US3587 ($NZ4885) a tonne, and followed falls in the previous four auctions.
The price of whole milk powder, a key factor in setting returns to local farmers, was fractionally higher at $US3311 ($NZ4509) a tonne to reach its highest level in nearly a year.
Agrifax HQ dairy analyst Amy Castleton said Fonterra had lifted its wholemilk powder volumes.
"However, solid demand seems to be absorbing anything New Zealand has to offer at the moment."
The volumes sold were up nearly 12 percent, and there were strong price rises for most of the products offered for sale.
The lift in prices is likely to support Fonterra's forecast payout of $6.55 a kilo of milk solids, which it expects to top up with a dividend of between 25 and 35 cents a share.
New Zealand milk production has been marginally lower this season compared with a year ago because of the weather, while production in the European Union and United States has risen.
However, prices have been underpinned by a strong lift in demand from China, and improved buying out of the rest of Asia and Latin America.
