Fonterra has increased its milk price to the second highest point on record and has informed farmers to hope for the same again, in the approaching year.

Fonterra, which processes almost 92% of the nation's milk, yesterday increased its milk price prediction for the season by 40c to $6.10 per kg of milk solids, as contrasted to $4.72 last season.

The co-operative also reaffirmed a proceeds prediction of 40-50c per share, with a target surplus of 20-30c per share.

Westpac bank anticipated industry-wide proceeds this season, as well as retentions would be increased by $1.8 billion on last season, while in-hand profits for farmers would be almost $8.8 billion that will be up by $1.6 billion.

Fonterra Chairman, Sir Henry van der Heyden stated that a more prescribed prediction for the coming season would be completed at the end of next month but farmers must make a financial plan for a milk price around this year's level.

Fonterra stated that North Island production was lowered by 4.5% against budget for this year so far, whilst the South Island was increased by 3.1%.