The world's largest milk-powder dryer, which officially opened today at the cooperative's Edendale site near Invercargill – is keeping the nation's dairy farmers internationally competitive, says the Fonterra chief executive Andrew Ferrier.

The diary giant’s Chief Executive expects dairy prices to ease, after lifting 95% in the season’s first half from their July 2009 low. “Prices were likely to then stabilize then find a new level. All of our long-term projections show healthy dairy prices", he said, adding that Fonterra’s dairy farmers will receive an extra 2 cents per litre of milk, making their average price 32.1 cents per litre.

Managing director of Fonterra Australia Bruce Donnison says that he is cautiously optimistic about the industry's fortunes. "We are seeing softening in demand but prices are still good", he says.

Explaining his point further, he said, "We still see the Australian dollar having a significant impact on revenues for those that are exporting. Over 60 per cent of our product is exposed to the export prices The Australian dollar can have a significant impact on the revenue stream”.

"However, going forward, I think there is a strong future around the dairy industry and bodes well for farmers' milk", said Donnison.