It is looking increasingly likely that Fonterra will have to cut its forecast payout to farmers, which is bad news for everyone, whether you live on a farm or in a city.
There has been another disappointing Global Dairy Trade auction this morning, prices falling 10.7 percent overall.
The average whole milk powder price slumped 13 percent, which is a crucial export product for Fonterra and its farmers.
The current forecast pay-out of $5.25 is below break-even point for many dairy farmers.
Farmers are already curbing their spending and that is going to have an impact in towns and cities across New Zealand.
Watch the full Talk Money report.