An economist says flat prices in Fonterra's latest online milk powder auction held early on Wednesday are masking strong forces in the world dairy market.
The average whole milk powder price was maintained at $US3345 a tonne, while skim milk powder fell by just over 1% to $US3021 a tonne.
Anhydrous milkfat rose 4.5% to $US5394 a tonne.
BNZ economist Doug Steel says prices over the past few auctions have been levelling out and the strong supply and demand is concealing other conflicting forces in the market.
He says the flattening of prices is unusual, given the extreme price fluctuations in recent years.
The Fonterra auction is held fortnightly.