Prices in the latest Global Dairy Trade auction have softened slightly, with a 3.8 per cent drop across the board.

Leading the decline, Whole Milk Powder - which has the biggest influence on Fonterra's farmgate milk price - fell 6.2 per cent to an average US$4,083/MT.

Butter also fell 2.8 per cent to an average US$5,659/MT.

All other reference products were up, however, with Skim Milk Powder - Fonterra's second biggest reference product - up 0.7 per cent to an average US $3,350/MT.

Lactose posted the biggest lift - up 8.6 per cent to an average US$1,392/MT, followed up Anhydrous Milk Fat, which rose 3.7 per cent to an average US$6,155/MT.

The move follows a 15 per cent overall jump at the last auction two weeks ago, spearheaded by a 21 per cent rise in Whole Milk Powder (WMP).

Westpac senior agriculture economist Nathan Penny said most experts were expecting a price drop in last night's auction, which "wasn't surprising, given the size of the rise last time."

Penny is positive about the result, given milk prices remain high "as milk is still pretty scarce on the ground."

He expects prices will likely maintain these levels, until the new season at least.

In an update on March 5, Fonterra lifted its 2020/21 forecast farmgate milk price range to $7.30-$7.90 per kg, up from $6.90-$7.50 per kg.

The midpoint of the range, off which farmers are paid, increased to $7.60 per kg.