Issues around the farmgate and factory gate price of milk are currently being examined by an interdepartmental group comprising of the Ministry of Agriculture and Forestry, the Ministry of Economic Development and Treasury.
Carter said he was not surprised by the commission's finding that there was little or no competition at the farm or factory gate.
"When we established Fonterra we knew there was some issues around competition. There's a significant amount of work going on now to check whether we've got a mechanism for establishing the farm gate milk price correctly."
Fonterra sets the farm gate price milk price using a confidential formula. The factory gate price is based on the farm gate price plus a 10c per kg of milk solids.
Fonterra's rivals argue that the Fonterra sets the farm gate price higher than it should be to stifle competition and to discourage farmers from leaving the co-operative. Critics including Consumer NZ say the farm gate pricing mechanism has contributed to higher prices for consumers.
But Carter said it was unclear whether that was the case.
He hoped the work on farmgate and factory gate prices would be completed by the end of the year and said it was not appropriate for him to comment on whether they were fair until then.
But in spite of the Commerce Commission's findings regarding the retail and wholesale markets, he could not assure New Zealanders they were paying too much for milk.
"What we do see is a very high international price affecting the New Zealand export markets and that clearly does have a flow on effect for New Zealand consumers and I acknowledge that concern."
Before the current farmgate pricing mechanism was introduced three years ago MAF officials told the Government it could affect consumer prices by 3.5c to 5c a litre. Mr Carter this morning said he was unaware of that advice.
Opposition leader Phil Goff said the commission's decision not to investigate milk prices further was "hugely disappointing".
"Families are finding it really hard with the cost of living particularly with basic necessities like milk.
"There should have been an inquiry what Labour will be pushing for now is an inquiry through our select committee. We need to know why the price of milk in New Zealand is so high when we're the country that produces it."
He said factory and farm gate prices should be examined as part of any such inquiry.
The commerce select committee may decide on Thursday whether to investigate milk prices itself.
Green Party MP Sue Kedgely said the Commerce Commission had "passed the buck" and it was now up to Parliament to resolve ";the issue of the virtual monopoly Fonterra exercises in the domestic milk market, and the effect this has on milk prices".
She said she would also press for a select committee inquiry.
"In our view, it is unacceptable for a company that has a monopoly on the supply of raw milk to other processors can set the price of milk in New Zealand."
Fonterra welcomed the Commerce Commission's announcement.
Chief financial officer Jonathan Mason said Fonterra had always been of the firm view that there was no justification for a price control inquiry or further regulation at any level of the milk market.
He said Fonterra's competitors led the call for a price control inquiry.
"Those competitors want to force down the amount they pay New Zealand farmers for raw milk," he said.
"The reality is that competition is thriving in the New Zealand dairy market," Mason said. ";If some processors are not doing as well as Fonterra, that's because Fonterra makes more from a bucket of milk than them - by doing what it was set up to do.
It adds value to New Zealand milk and is performing well, supported by recent world class processing investments and ongoing investments in value-add. As a co-operative owned by Kiwi farmers, all that value flows back into the New Zealand economy."
Fonterra Shareholders' Council Chair Simon Couper said the Commerce Commission's decision to reject an inquiry into the price of milk is a vindication for all Fonterra farmers.
"After years of contentious debate the decision today is a justification of what we have said all along - that the farm gate milk price is fair and reflects the capital and production costs incurred in the dairy industry," said Couper.
"Competition is in the best interests of farmers as it helps to ensure we receive the best price for our product at the farm gate and in turn guarantees the need for our co-operative to evolve in order to maintain its edge."
- additional reporting agencies
