Dairy prices fall in NZ Fonterra's auction

WELLINGTON Feb 16 (Reuters) - International milk prices fell in a second straight dairy auction, New Zealand's Fonterra Cooperative Group, the world's biggest dairy exporter, said on Thursday.

Fonterra's Global Dairy Trade-Trade Weighted Index, which covers a range of 30 products and contract periods on offer, dropped 3 percent, with an average selling price of $3,545 per tonne. That followed a 0.9 percent fall in the previous auction.

All products fell except rennet casein.

The index has fallen about 25 percent since hitting a near four-year peak in March last year as global commodity prices retreat.

Full details of the auction are at: www.globaldairytrade.info

Fonterra holds two auctions a month, with the next one on March 7.

In December, the co-operative raised its payout forecast range for the 2012 season by 20 cents to NZ$6.90-NZ$7.00 per kg of milk solids, because of a modest recovery in dairy prices.

The payout for the 2010/11 season was a record NZ$8.25 a kilo on record production and sales.

Fonterra is owned by about 10,500 farmers and controls around a third of the world's dairy exports, generating more than 7 percent of New Zealand's gross domestic product.

(Reporting by Mantik Kusjanto)