Dairy prices have again dropped in Fonterra's international dairy price auction overnight, but by significantly less than in recent weeks.
Average dairy prices have dropped point six (0.6) of a percentage point.
In the last fortnightly auction prices fell 8.4 percent - a 40 percent drop since February.
Fonterra has cut its forecast payout to farmers from $7 per kilogram to 6 on the back of the falling international demand.
That has been attributed to a lack of Chinese buyers, who overstocked on milk powder last year because of concerns Chinese regulation of infant formula could restrict supply.
Hayley Moynihan, a senior dairy analyst at Rabobank, says while whole milk prices rose by 3.4 percent, prices for other products are still falling dramatically.