Federated Farmers will be chairing a meeting in Taranaki on Thursday to discuss the next step for farmers whose herds have been affected by defective semen supplied by the Livestock Improvement Corporation.
LIC has agreed to pay dairy farmers the costs of inseminations and semen from the bull Matrix, which was found to have a genetic defect.
An estimated 3000 of his female offspring have a naturally occurring mutation which causes them to be excessively hairy, heat intolerant and poor milk producers.
Federated Farmers Taranaki dairy chair Derek Gibson says farmers are considering legal action as one of the options open to them.
He says the Commerce Commission is also in the early stages of investigating the situation.
Mr Gibson says farmers need to decide whether they want to take legal action to try and get some compensation.
"We want farmers to make that decision as a collective group, so that everybody I suppose understands what the implications are and the pathway that the group wants to take."