The dairy co-op's made a half year after-tax profit of 364-million dollars, down 27 million on the same time last year.
The forecast record farmgate milk price is still $9.30 to $9.90 per kilogram of milk solids.
Chief Executive Miles Hurrell says Fonterra knew this year was going to be more challenging due expensive milk, which is up almost 30 percent year-on-year.
He's pleased with the co-op's profit after tax because it shows it's performing well, even in a high milk price environment.
