More bad news for the dairy sector.

Fonterra's latest Global Dairy Trade Event has seen a six percent drop in prices overnight.

There was some optimism the slump was levelling out after a 0.6 percent drop in the last auction.

But the latest result is a continuation of a trend in 2014, that's seen prices hit their lowest level since October 2012.

Whole milk powder was down 4.3 percent in the latest auction, with all of the seven product categories on offer dropping in price.