Opposition parties have rounded on Fonterra, criticising its move to push out its payment times from 30 to 90 days for contractors.
Labour said the move could drive already struggling contractors "to the wall'', while the Green Party called into question Fonterra's solvency.
Fonterra has defended the decision, in turn rejecting criticism of its financial performance.
Labour's Small Business spokeswoman, Jacinda Ardern, said Fonterra's decision to extend its contractor payment period was a blow to small businesses which were already struggling due to the plunging milk solid payout's effect on farmers and rural communities.
"Cashflow is king for these companies, so it's extremely disappointing for Fonterra to push out payment times.
"If this drives struggling contractors to the wall, the blame can be laid at Fonterra's door,'' Ms Ardern said.
She said "clearly'' Fonterra was facing big problems with the fall in the dairy price, but that was no excuse not to pay promptly.
When asked via email to comment, Fonterra chief financial officer Lukas Paravicini said the company's performance was "strong'' as outlined in the November first-quarter result.
An updated interim result is due on March 23.
"As we said in November, we're on track to reduce [debt] gearing to between 40%-45%''.
Mr Paravicini said yesterday's payout cut by Fonterra illustrated challenges facing the dairy sector and Fonterra's ongoing responsibility to farmers to operate as efficiently as possible.
Part of that was to move all its largest suppliers of goods and services to payment terms which matched Fonterra's global standard.
"We are very conscious of the role we play in New Zealand communities beyond our farmers.
"This alignment of supplier payments affects around 20% of the 18,000-20,000 suppliers we have globally,'' Mr Paravicini said.
Green Party small business spokesman David Clendon said Fonterra had reportedly forced 10%-20% cuts in supplier and contractor rates, besides the 90-day extension.
"Small businesses are not banks, and should not be expected to provide Fonterra with a free 90-day overdraft,'' he said.
He said the Government needed to look closely at how solvent Fonterra was and whether its financial position meant "we're actually looking at the symptoms of a much more serious economic risk''.
Mr Paravicini said work on the changes had been under way for six months and was part of Fonterra's wider business transformation, announced almost a year ago.
Mr Clendon said Minister for Small Business Craig Foss should be standing up for small businesses and demanding Fonterra pay its bills within the normal timeframe of 30 days.
