A farmer supplying Westland Milk Products says the co-operative has backed out of a promise to pay a premium for winter milk.
The farmer told RNZ rurals he had sold quality stock and bought about 100 pregnant cows to calve in autumn and supply winter milk with the understanding he would be paid more.
He said his farm could lose about $100,000 as a result of the payment not being what he had expected.
Westland chief executive Rod Quin said the co-operative did not make any promises to the farmer.
The company is forecasting a payout this season of $4.55 to $4.95 per kilogram of milk solids.
"Our contract definitely states season 2016/2017 for potential UHT winter milk premiums, so my view - perhaps [this is] a misunderstanding, and we've been trying to work with a farmer to see if we can accommodate any milk earlier than that, and that's still a work in progress.
The farmer, who did not want his name used, said he had communicated through emails and phone calls with the co-operative and was expecting, before transport costs, a premium of an extra $1.78 per kilogram of milk solids for May, $1.98 for June and July and $1.78 for the first two weeks of August.
Mr Quin said that this is proposed - but not for this winter.
"It looks like he's made moves on the basis of a misunderstanding that that's available here and now for the coming winter - and that is not the case."
The farmer said he only bought the pregnant cows because the co-operative had made it clear to him that the winter premium was available. He said he might have to now sell the newly calved cows if he isn't being paid the premium he expected for the milk.
