Synlait updated its forecast milk payout on Tuesday in response to strong dairy prices in recent months.
The company raised its base milk price for the 2020/2021 season to $7.20 kgMS, up from $6.40 kgMS.
David Williams, Synlait's national milk supply manager, said the higher price reflected strong commodity prices on the international market.
"Despite the wider global uncertainty, dairy commodity prices have remained robust and a higher forecast base milk price will be welcomed by our Synlait farmer suppliers," he said.
The specialty dairy producer, which is a major supplier of infant formula to A2 Milk, announced late last year that it expected its profits to fall by almost half in the 2021 financial year as a result of lower A2 Milk sales.