An independent milk processor, Synlait in Canterbury, has no quarrel with proposals to change the raw milk regulations that require Fonterra to provide milk to its competitors.
Chief executive John Penno says Fonterra should have nothing to fear.
The Ministry of Agriculture is proposing changes to increase the amount of milk Fonterra is required to provide independent processors to about 5% of its total supply. Currently it supplies about 3%, or almost 600 million litres.
A margin of 10 cents per kg charged for supplying the milk would also end.
MAF also recommends that access to the milk by other companies should be restricted to three years, with restrictions on how much milk can be taken at different times of the year.
Dr Penno says the proposed limit of three years is not a big blow for Synlait because its business plan includes reducing its reliance on that milk.
Synlait is one of the biggest independent processors.
Fonterra says its costs will be increased by about $200 million over three years.
Chairman Sir Henry van der Heyden says the proposals will work against its efforts to reduce milk prices in New Zealand.
Fonterra's Shareholders Council has raised similar objections. Chair Simon Couper Fonterra is expected to supply 570 million litres of milk to independent processors this season.
He says more than half of that will go to processors who export most of their product. Two thirds of those businesses are at least partly foreign-owned.
Federated Farmers dairy vice chair is Robin Barkla also feels independent processors are getting an unfair advantage.
The closing date for submissions on the proposals is 24 February.
