Fonterra is ''largely'' meeting its statutory requirements when it comes to calculating the price it pays dairy farmers for their raw milk, the Commerce Commission has found.
Following amendments to the Dairy Industry Restructuring Act in July last year, the commission must undertake two separate reviews of the dairy co-operative's base milk price setting in each dairy season.
Those reviews were of its farm gate milk price manual, which sets out the methodology for calculating the base milk price for the season, and its base milk price calculation.
The commission released its review of Fonterra's 2012-13 base milk price calculation this week.
The commission specifically considered the extent to which the assumptions adopted, inputs and process used to calculate the base price provide an incentive to Fonterra to operate efficiently, while providing for contestability in the market for the purchase of milk, deputy chairwoman Sue Begg said.
The draft report was being provided to Fonterra for comment, while feedback from other interested parties was also welcomed, and the final report would be published by September 16.
