Listen: Good news and bad news for Fonterra

Good news for Fonterra this morning in the latest GlobalDairyTrade auction, with the GDT price index gaining 5.9 per cent and whole milk powder prices up by 7.6 per cent.

Fonterra's chairman John Wilson spoke to The Country about the GDT's third gain in a row along with the cooperative's recent bad news concerning its investment with Chinese company Beingmate.

The GDT result was "inline with where we feel prices should be" says Wilson who is focused on low milk production due to drought conditions, "it's going to be a tough road to the end of the season, with certainly a lot less product available for sale."

The bad news story for Fonterra has been China's Beingmate Baby & Child Food, (in which it has an 18.8 per cent stake), issuing another earnings downgrade - this time to a loss of $171-$214 million for the December 2017 year.

Wilson says Fonterra is "very concerned" with Beingmate's performance but the dairy giant has two directors on the board who are working with CEO Theo Spierings "to get the right outcome."

"We need to be patient; we need to play the long game."