Fonterra's CEO says cheaper butter prices could be on the horizon. 

The dairy co-op's announced a 13 percent rise in annual operating profit and a record-high final milk payout of $10.16 per kg.

Chief Executive Miles Hurrell says it's a great result for farmers. 

He says the price of wholesale butter globally has fallen 15 percent in the past two months.

"At some point, that'll flow through to the supermarkets - I suspect that they'll set their own prices, but that should flow through and give it an element of relief."

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