Fonterra

Dairy commodity prices tumbled at Fonterra's overnight online auction, with the globalDairyTrade trade weighted index falling 8.2 percent, and the average winning price down to $US4443 ($NZ6064) from $US4826 a fortnight ago.

The attention of the world's dairy markets will be focused on today's globalDairyTrade event after news cyclones, floods and bush fires have cut Australian milk production by at least 100 million litres this season.

The increase in Fonterra's forecast milk payout last week appears justified, after prices in its latest internet auction lifted an average 2.4% yesterday.

Dairy giants Fonterra and Nestle are expanding their Dairy Partners America's joint venture into Chile.

Rules requiring Fonterra to supply raw milk to competitors, was costing the country up to $450 million a year, a study commissioned by the co-operative has calculated.

Fonterra is making a second foray into a developing market, announcing plans to establish a pilot dairy farm in India.

Fonterra, the largest processor of milk in the world, has set a record for the most milk processed in a single day.