Fonterra is increasing its forecast payout for the current season by 60 cents per kilo of milksolids. This means an average payout of around $1 million to its farmers shareholders.

Agriculture Minister David Carter has ruled out government intervention to keep milk prices down, saying high international prices will benefit the New Zealand economy.

Prices in Fonterra's latest online auction have been pushed to record levels but recent volatility means picking the top of the cycle is proving tricky.

Freeze comes a day after the Government ordered a review of whether the local market was working well for consumers.

Fonterra today announced it would freeze the domestic price of milk for the rest of year, after criticism that it was becoming unaffordable for many families. The price of milk had risen steadily over recent months...

The price of milk powder rose to the highest level since Fonterra began its online auctions in July 2008 in last night's auction.

The Chinese company that sparked a fierce national debate last year about foreign investment in farming is ploughing ahead with plans to export millions of cartons of UHT milk from New Zealand to China.

The bid is all about getting control of the seed business.

World dairy prices have continued to surge in Fonterra's latest online global dairy auction, rising 7.2 per cent overnight.

Dairy giant Fonterra has been given permission to sue the owners of the Tamahere coolstore that exploded in 2008 for $25m worth of cheese that it lost in the blaze. The blast killed one firefighter and injured seven others.

The New Zealand dollar climbed back above 77 US cents as food inflation fears prompted investors to seek out commodity-linked currencies.