December 11, 2013

In order to process an additional 2.4 million litres of milk each day, Fonterra Board has approved US$235 million investment into a new high-efficiency milk powder plant at its Pahiatua site in the Manawatu district of New Zealand.

Fonterra's Director of New Zealand Operations, Robert Spurway said the Co-operative's continued investment in milk powder driers was to meet the growing demand for dairy nutrition globally and demonstrated Fonterra's strategy of optimising its New Zealand milk business.

The announcement of the investment at Pahiatua comes less than a week after the Co-operative celebrated opening the world's largest milk powder drier at its newly completed site at Darfield in Canterbury.

"This new drier in Pahiatua will help drive greater efficiencies across our manufacturing footprint. Last season we set a new record for the most milk collected in one day and overall milk production has been increasing by roughly three per cent each year. This drier will help us process the extra milk in a way that delivers the most value to our farmers.

The demand for dairy nutrition around the world, especially for whole milk powder, is increasing. Our expansion at Pahiatua will ensure that Fonterra has the capacity to meet this demand and to process the continued growth of milk supply in New Zealand," said Spurway.

He said Pahiatua's new drier will use the latest energy-efficient processing technology and be the first in the country to reuse its own condensate. The wastewater it creates will also be treated and used for irrigation.

Tararua Mayor Roly Ellis said Fonterra's announcement was exciting news for the community and would create new opportunities for local residents.

Preliminary earthworks have begun at the site and construction of the drier and associated infrastructure will start in mid-December. The first milk powder from the new drier is expected to roll out of the site by September 2015.