Tuesday, New Zealand's Fonterra Co-operative Group revised its forecast payout for the 2008/09 season to NZ$5.2 per kilogram of milksolids, representing an increase of 10 cents from the previous forecast in January.

Fonterra normally revises only when the forecast payout moves by at least 30 cents from the prior forecast, but the Board wish to share the news of the higher payout forecast with farmers as soon as possible, Chairman, Henry van der Heyden said.

Fonterra said powder prices increased and global sales team made good progress in selling products at improved prices. As a result, we now have the cautious optimism necessary to signal a modest but welcome increase in payout, Heyden added.

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