Smiles on the farm as dairy farmers get pay rise

About $750 million hit dairy farmers' back pockets last week when they got a long-awaited pay rise.

The average farmer's monthly cheque was about $70,000 as they earned 50 per cent more for their milk than at the same time last year.

Dairy giant Fonterra divvied out the extra cash in recognition of its expected record payout to farmers for the 2007-08 season.

Some farmers have already started spending the windfall. They've taken the increased forecast as not only an opportunity to buy machinery, upgrade the farm and clear debt, but to treat themselves a bit.