Fonterra may have to look at building another milk processing plant in the South Island to handle the increasing milk production there.
Trade and operations head Gary Romano says dairy conversions and herd expansion has grown milk production in the South Island by 6% to 7% per year during the past decade.
Fonterra is forecasting its southern milk supply will continue to grow at about 5% per year within its current planning period.
Mr Romano says that is why it had to expand its Edendale processing site in Southland, where a fourth powder drier is commissioned this season.
In contrast, Mr Romano says milk production in the North Island has flattened out: growth in the southern North Island is offsetting some of the reduction.
