An ANZ Bank rural economist does not believe whole milk powder prices will recover sufficiently to meet dairy cooperative Fonterra's current forecast payout to farmers.
Fonterra has said the price of whole milk powder needs to rise to about $US3500 by March next year if it is to maintain its $5.30 per kilo of milk solids payout.
In the latest auction held yesterday, whole milk powder rose slightly to $US2,522.
Economist Con Williams said the price would be lucky to get to $US3000 by March, under current conditions.