There's been a big increase in prices at the latest Global Dairy Trade auction, with the average price rising 14.8 percent.
Whole milk powder, which is a major product for Fonterra, rose 19.1 percent on average.
It’s a relief for farmers who had watched prices fall for 10 successive auctions.
But analysts say that prices need to rise further if Fonterra is going to avoid having to make another cut to its forecast payout to farmers this season.
Watch the full report with Tony Field.