New Zealand dairy giant Fonterra has hit out at the EU's plans to reintroduce export refunds in a bid to support European dairy manufacturers.

The European Commission last week said that it would introduce a number of measures to shore-up the struggling European dairy industry in the face of falling prices and demand globally.

The level of support given will be determined on Thursday (22 January).

However, the move has met international consternation and Fonterra has warned that it could further depress dairy commodity prices and slow recovery.

"We are deeply disappointed by the news from the EU that it will reinstitute export refunds," Fonterra's managing director global trade, Kelvin Wickham, said.

"We do acknowledge the considerable pressure on producers with lower prices and the credit crunch. However, any move to subsidise producers there with export refunds by the EU will put pressure on the world market at a time that is already difficult for dairy exporters everywhere and will potentially delay recovery of the market to more sustainable price levels," Wickham said.

EU agriculture spokesman Michael Mann told just-food that it would be "stupid" of the European Commission not to use available means to support dairy produces "when our trading partners are taking similar measures".

"This is a temporary measure and it is going to be implemented for as long as necessary… but it does not mean export refunds are a long term policy… We still aim to abolish export subsidies by 2015," Mann said.