Synlait Milk has bumped up its forecast milk price from $5 to $6 for the 2016-17 season, matching Fonterra.
While the company had planned to provide an updated forecast at the start of February, an update now was more appropriate and beneficial for its 200 Canterbury suppliers, chairman Graeme Milne said in a statement.
''We've kept a close eye on the global dairy market and the trending increase in dairy prices can't be ignored,'' he said.
This month, Fonterra increased its farmgate milk price forecast by 75c to $6. A $6 milk price brought farmers to above break-even levels, although many farmers had increased debt and deferred maintenance expenditure over the last season or two, DairyNZ chief executive Tim Mackle said.
Mr Milne said reduced European production over the past three months showed European dairy farmers were responding to lower milk prices.