A tricky balance is being struck between consumers and producers - as dairy prices rise

In last week's Global Dairy Trade auction, prices rose one-point-four percent across all categories.

Infometrics chief economist Brad Olsen says that's due to strong demand, despite global supply being down.

But he says it's good news for farmers, with production up one-point-three percent on the past 12 months.

Olsen says we have more product to start sending away, and a lower exchange rate that means New Zealand can make more money going forward.