** Shares of Australia Dairy Nutritionals AHF.AX rise as much as 8.5% to A$0.051, their highest levels since May 7

** The dairy producer enters into manufacturing agreement with Sprout Organic to manufacture intermediate and fortified milk formula base powder

** About 1.9 mln shares traded in stock's busiest session since February 26

** Stock down 36.8% YTD, including current session's moves

(Reporting by Manasi Dasa in Bengaluru)

((Manasi.DasaSundeep@thomsonreuters.com;))