A 26 per cent jump in the price of whole milk powder has been noticed at Fonterra's latest auction. The dairy farmers are seeing it as just the commencement of a new upward trend.

Fonterra specified that the average price today rose to $US2301 ($NZ3495) a tonne.

If adhered to Nigel Kuzemko, Fonterra's Commercial and Strategy Director then there has been starting of some tentative signs of improving demand.

He said. "We are seeing signs of strengthening in demand and prices, which is encouraging, but the market remains dynamic with trends difficult to forecast."

Mr. Kuzemko revealed that inclusion of Australian product in the auction was in line with Fonterra's plans to expand the range of products sold at auction.

There has been enhancement in price by a $472 per tonne on the July result.