Fonterra has made a ''significant effort'' to improve the transparency of its base milk price calculations, the Commerce Commission says.
The base milk price is the price the dairy co-operative sets and pays to farmers for their milk.
The commission is required, under the Dairy Industry Restructuring Act, to undertake an annual review of its calculation of that price.
Yesterday, the commission released its draft report on Fonterra's calculation for the 2014-15 season, which is at present set at $4.40 kg/ms.
Its overall view was it was ''largely consistent'' with both the efficiency and contestability purposes of the Act.
The quality of information Fonterra provided had improved and the commission would be encouraging it to continue making its calculations more accessible to the broader dairy industry, deputy chairwoman Sue Begg said.
''Fonterra has made a significant effort to improve the transparency of its calculations and we have now resolved some outstanding issues from last year,'' she said.
The review did not cover the retail price consumers paid for processed milk, nor could the commission comment on Fonterra's dismal forecast $3.85 milk price for the 2015-16 season.
The commission had sought to engage more with stakeholders this year, including meeting independent processors and market analysts, the draft report said.
That gave an improved understanding of independent processors' comments and concerns about the base milk price calculation, and investment markets and industry views on the base milk price, and its impact on the attractiveness of investing in dairy farming, Fonterra or other milk processors.
The stakeholder engagement also highlighted a desire for greater transparency over how Fonterra set the milk price.
Continued engagement with Fonterra and other interested parties was seen by the commission as an important part of ongoing reviews.
Submissions were due on the draft report by September 1, while the final report would be published on September 15.
Meanwhile, independent dairy processors collected 22% of all milksolids in the South Island in the 2014-15 season, Primary Industries Minister Nathan Guy has certified.
Under the Act, the minister was required to certify when Fonterra's market share dropped below the 80% threshold.
That triggered expiry of the pro-competition Act provisions in the South Island by no later than May 31, 2018, unless there was legislative change before then.
While Fonterra continued to collect more milk every season, it was encouraging to see new processors enter the market and create competitive pressure, Mr Guy said in a statement. Independent processors also collected 9% of all milksolids in the North Island.
The Commerce Commission has been tasked with providing a report on the state of competition in the dairy industry, which was due next year.
