Fonterra is expecting international dairy prices to pick up again later this season.
But it's holding off on any change to its forecast payout to dairy farmers at this stage, leaving it sitting well below the record payout announced on Wednesday for the past season, when it also broke revenue, export and milk production records.
The $8.25 payout for the 2010-11 season is made up of a milk price of $7.60 a kilo of milk solids and a distributable profit of 65c a share.
That's a dollar higher than the upper end of the payout forecast for the current season, which Fonterra says reflects a softening of international commodity prices since early this year.
Global dairy prices slipped further in Fonterra's online auction this week, to reach their lowest average in more than a year.
But chief executive Andrew Ferrier says the market is trending the way they expected it to, and prices should recover early next year.
"There's a perception and a reality," he says, "that there's less dairy products available at that time of the year."
Manual shows how milk price calculated
Meanwhile, Fonterra has released information about its milk price setting system which it says shows the price it pays farmers for their milk is largely dictated by world commodity prices.
Fonterra has been under pressure to reveal the details of how it calculates prices, with some independent processors and other critics saying it charges too much for the milk it supplies.
The 80-page Farmgate Milk Price Manual sets out the way the company calculates the amount paid to New Zealand farmers for their milk.
Mr Ferrier says it's clear from its financial results for the past year, which show a 17% drop in earnings for New Zealand and Australia, that Fonterra has not passed on anywhere near the global milk price increase to local consumers.
Pointing out that the prices of bread and rice have risen more than the price of milk has, he says: "We are extremely responsible marketers of our products. We do not charge excessive margins."
Mr Ferrier finished as Fonterra's chief executive on Friday. His replacement, Theo Spierings, starts on Monday.