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Fonterra expands Edendale capacity

Media Release
31 January 2008

Fonterra expands Edendale capacity

Fonterra has announced its plans to build a new NZD212 million milk powder plant on its Edendale site in Southland.

Fonterra CEO Andrew Ferrier says the investment is in anticipation of projected growth in South Island milk supply, which is forecast to increase significantly by the 2012/13 season.

“Growing the Cooperative’s core business by sustainably increasing its milk supply and expanding its processing capacity is key if we are to capitalise on strong market demand for our products.”

“The new dryer will manufacture regular UHT and instant whole milk powders, and will take the site’s peak processing capacity to over 15 million litres per day. It will be modelled on successful powder installations at our Edendale and Clandeboye sites and will be one of the largest powder plants in the world.”

Mr Ferrier says the development at Edendale reflects Fonterra’s growth strategy in action.

“Capturing the growth opportunities in the ingredients segment remains a key part of our strategy.”

He says while prices may be softening from last year’s record highs, overall demand for dairy products is growing at a rate of around 3 per cent per annum, with demand particularly strong in China, Latin America and the Middle East.

“This investment is a vote of confidence for Fonterra, and the New Zealand dairy industry. It also recognises Edendale’s reputation for the highest product quality and its particular expertise in powder production.”

Along with whole, skim and butter milk powders, Fonterra’s Edendale site produces cheddar cheese for markets in Japan, the Middle East and the Philippines, refined and edible grade lactose, whey cheese, casein, anhydrous milk fat and whey protein concentrate.

Fonterra Edendale Hub Manager Keith Mason says the planned work will ensure Southland milk can continue to be processed in Southland, and demonstrates Fonterra’s continuing commitment to the region.

“Edendale plays a key part in our overall processing strategy, and will continue to do so,” says Mr Mason.

He says the construction of the new facility will mean work for local businesses, and the plant itself will create around 40 new roles on site.

The new plant is scheduled to begin processing milk by the end of next year.

ENDS

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