The country's two major supermarket chains say they will not increase their milk prices this year.
Progressive Enterprises says prices for all their brands of fresh white milk will not go up, while Foodstuffs is guaranteeing a freeze on Fonterra milk products.
The move comes after Fonterra froze the wholesale price of all its brands of domestic milk for the rest of the year, and called on supermarkets to do the same.
The dairy co-operative announced its freeze on Friday, shortly after the Minister of Agriculture said he was seeking advice from his officials about the rising cost of milk.
David Carter has welcomed Fonterra's action but has said his request to his Ministry to look at whether the market is operating competitively still stands despite the price freeze.
A spokesperson for one of Progressive Enterprises' supermarkets, Luke Schepen, says shops will absorb any extra costs such as transportation or staff wages rather than passing them onto consumers.
He says there are no plans for a similar freeze on butter or cheese.
Foodstuffs says it won't increase the prices of other non-Fonterra milk brands, if suppliers do not increase their wholesale prices.
Consumer New Zealand seeks investigation
Consumer New Zealand is calling for a full investigation by the Commerce Commission into dairy pricing.
The watchdog's comments follow Fonterra's move to freeze the domestic wholesale price of milk, saying rising international prices are seriously affecting New Zealanders.
Consumer New Zealand says the freeze is a positive move, but could possibly be a way of warding off a full pricing review.
Deputy chief executive David Naulls says now is an appropriate time for an investigation.
"There's not much competition in the dairy market, really. There's one supplier of milk, two suppliers of the main brands of cheese, milk and butter which are going to supermarkets, and there's two supermarket chains.
"We would like to see a full investigation into how the pricing works there."
Price freeze 'too late for some'
An agency dealing with struggling families says Fonterra's decision is too little, too late.
The Wellington Downtown Community Ministry says the price freeze means nothing to poor families.
Director Stephanie McIntyre says dairy products are still unaffordable for many New Zealanders - and have been for some time.
"We can testify to that by the high demand that's placed on a little packet of milk powder, which is one item that I would say uniformly every single person who comes through our food bank requests."
Ms McIntyre says unless there is a change in government policies, she can not see any significant drop in food prices.
But Auckland City Missioner Diane Robertson believes the freeze on milk prices is an amazing gesture from Fonterra.
"I think what it means really is that we will start having the discussion about the cost of food in New Zealand for healthy food."
Ms Robertson says price freezes are not the only answer and it is time to begin discussing other solutions to make essential foods affordable.
