In an email sent to farmers this week, chairman Sir Henry van der Heyden confirmed the decision on the custodian had been made.
There had been three options: the first was for Fonterra to own the custodian, the second was for a farmer-controlled trust to own it and the third involved farmers retaining legal title to shares they placed with the fund and in effect becoming the custodian.
Sir Henry said the majority of farmers supported the first two options, with a preference for a farmer trust custodian.
When contacted yesterday, a Fonterra spokesman said the board was not making public comment about its decision.
Changes to the custodian structure could only be made with approval from 75% of farmers, Sir Henry said.
He and the dairy co-operative's chief executive, Theo Spierings, would hold meetings in New Plymouth, Christchurch and Hamilton next week.
When contacted, South Canterbury dairy farmer Leonie Guiney, who was among a group of critics that launched a website - www.ourco-op.co.nz - and who wanted a second vote on the proposal for share trading, was "a little surprised" the majority of farmers wanted the option.
Having only had the information for two weeks, or slightly less, she was interested in how much feedback had been received in that time.
The fundamental issue was that the proposal had changed by shifting the title of the shares from the farmer to a custodian.
A trust arrangement was not ownership.
There was "no way" option one or two could deliver 100% farmer ownership or control, Mrs Guiney said.
The group, set up as a voice for farmers not happy with the new structure and who felt they were not being heard, had received "huge support", including a lot from the North Island, she said.
Last week, a letter from Federated Farmers dairy chairman Willy Leferink to Sir Henry, Fonterra board members, Fonterra Shareholders' Council board and the Federated Farmers board was leaked to the media.
In the letter, Mr Leferink asked the co-operative to return to its farmer shareholders, give them "all the ins and outs of TAF" and ask them to vote again on the proposal.
After the letter had been leaked, Mr Leferink said in a statement that there was "way too much rumour and speculation" around TAF, which was not helped by the letter and internal emails being leaked to the media.
The letter was then shared with the organisation's dairy section members. Much of what was in TAF made sense to him.
The "big sticking point" for the organisation's members seemed to come down to the proposed shareholder fund, Mr Leferink said.