WELLINGTON May 28 (Reuters) - New Zealand's Fonterra dairy co-operative on Wednesday cut the forecast price it pays farmer shareholders for milk by 17 percent in the year starting June, as increased global dairy production has knocked prices lower.
The world's largest dairy exporter, which is New Zealand's largest company, set its opening forecast for its 2014/15 payout price, at NZ$7.00 ($5.97) per kilogram of milk solids before retentions.
It also reduced its final payout price to NZ$8.40 for the 2013/14 season from a forecast NZ$8.65, although it was still a record high payout.
The cut in the forecast payout comes as global dairy prices have tumbled more than 20 percent since the start of the year, retreating further from a record high hit just over a year ago.
($1 = 1.1716 New Zealand Dollars) (Reporting by Naomi Tajitsu)