Fonterra says the strong farmer response to its latest share offer shows that they are growing more confident about using its trading among farmers system.
About 20% of the co-operative's farmer shareholders applied to deposit some of their shares in the Shareholders Fund set up as part of TAF.
They get the cash value of the shares but give up the dividend rights, which are sold to outside investors who buy units in the fund.
Fonterra says farmers have offered more than 75 million shares, adding up to almost $600 million.
That more than covers the $475 million Fonterra was looking for, to replace what it put into the fund to launch it six months ago.
Fonterra chairman John Wilson, says it won't be increasing the size of the Shareholders Fund but will scale back the offer to about 80% of what each farmer was seeking to sell.
He says the total size of the fund is still under the company's preferred range of 7% to 12% although he says, six months in, he's comfortable with the way the system is working.
The Shareholders Council, which represents Fonterra's 10,500 farmer suppliers, says it's not surprised at the strong response from farmers to the latest offer, after the caution they showed when the fund was launched.
Chairman Ian Brown expects some farmers will use cash from the shares they deposit to expand their operations and others will use it to reduce debt.
He says there's been little happening so far in the other part of the TAF system, where Fonterra farmers can trade shares with each other.
But he expects that to change as they get ready for the new season, starting next month.
"It should start to ramp up quite quickly soon because we are fast approaching the end of our season. There are farms being sold, farms being amalgamated so I would expect to see a bit of activity in the Fonterra share market."