UPDATED 4.30PM: Organics might be the way to go for Kiwi farmers.

Fonterra has announced it's expanding its organic milk business.. and will give organic farmers an extra 45 cents per kilogram of milk solids.

The companies business manager for organics Craig Deadman says people in south-east Asia, China and the United States are choosing organic more frequently, so demand is growing.

He says Asian consumers also favour organic milk powders.

Deadman says demand is growing for organic products both here and internationally.

He says whole dairy products are sent to places like Australia, but there's demand for organic milk powders overseas as well.

"A number of our customers in these markets put our ing inrto prods and then exp them into china and so china is a sign market for the consumption of our organic products."