Dairy behemoth Fonterra has been slammed by angry farmers across New Zealand as it revealed in its annual report yesterday [Monday] that it paid two executive employees more than NZ$2m (US$921,000) each last year, and nine more over NZ$1m each.

In total, more than 974 of its staff were paid over NZ$100,000 each in the group's first year in business with a monopoly on more than 95% of the NZ dairy industry. And at the same time, the group told its 13,000 farmer-shareholders to tighten their belts as it slashed milk solids payout forecasts from last season's record NZ$5.33/kg to NZ$3.70/kg.

CEO Craig Norgate, 36, is now NZ's highest paid executive taking home over NZ$2m, but he refused to name the other top earners.

Among these are believed to be Jim Hepburn, whose package included a redundancy payout resulting from last year's merger between the Dairy Board, NZ Dairy Group and Kiwi. Some of the money was also paid to overseas executives, and was earmarked for performance related pay packages and incentives.

Kevin Wooding, chairman of Dairy Farmers of New Zealand in Te Awamutu, mentioned stoically: "We've come to learn that they're big spenders. These things don't really surprise us now - though a few months ago they might have."

Nevertheless, Wooding explained that Fonterra's ordinary farmer shareholders are very concerned: "When somebody earns as much money in one year as an older generation farmer would have earned in a lifetime, it's a bit of a concern."

Morrinsville dairy farmer Ewing Thompson told the Nelson Mail: "Farmers are absolutely gutted. We're being treated more as suppliers than shareholders. That's a pack of dough. Who's making the money?"

Fonterra recently announced a first-year loss of NZ$50m on revenue of NZ$13.9bn.