Fonterra said two of its long-serving farmer directors - Malcolm Bailey and Ian Farrelly - will retire from the board at the Co-operative's annual meeting in December.

Chairman John Wilson said Bailey and Farrelly were dedicated and experienced directors who shared a strong commitment to co-operative principles and the business' strategy of converting more milk into higher-value products.

"Both have served on our board during a period of significant change, including the introduction of Trading Among Farmers, our business strategy refresh and more recently the governance and representation review," Wilson said in a statement.

Bailey was elected to the board in 2004, after previously serving as president of Federated Farmers. Farrely was elected in 2007 following a 20-year career in the banking industry.

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The annual meeting is scheduled for December 8. In a separate statement, Fonterra said it appointed the current chief executive of First NZ Capital, Scott St John, as an independent director, effective from November 1.

St John will stand down from his role at First NZ Capital in early 2017.