"I'm pleased Fonterra has increased the payout forecast as west coast farmers face lean months before they start getting decent milk cheques in September or October."
Fonterra chairman John Wilson said the higher forecast was good news for farmers and for New Zealand.
"The increase reflects continuing strong demand for milk powders globally," he said.
"Last December, the Fonterra board approved a forecast farmgate milk price that was 70c kgMS below the price that had been calculated in accordance with the Milk Price Manual.
"We are maintaining this position, with yesterday's forecast being 70c lower than the $9.35 milk price derived under the Milk Price Manual."
Mr Wilson said the board had the discretion to pay a lower farmgate milk price than that specified under the manual if it is in the best interests of the co-operative.
The board has also approved an increase in the advance rate schedule of monthly payments to farmer shareholders. Payments from March through to June will be 25c kgMS higher than the previously published schedule.
"We will provide an update on business performance when we announce our interim result on March 26," Mr Wilson said.
Fonterra is required to consider farmgate milk prices every quarter as part of the Dairy Industry Restructuring Act .
