FONTERRA has successfully completed a $26 million upgrade at its Darnum Park plant near Warragul to boost production of premium specialty milk powders to 60,000 tonnes a year.
Prior to the upgrade Darnum had one high quality drier with the second drier restricted to commodity products.
Managing director of Fonterra ingredients in Australia, Bruce Donnison said the engineering works that started earlier this year had been completed on time and on budget.
And he said the new plant had already “received a big tick” from Danone, the major customer for the high-value output that would be used to make infant formula and growing powders.
Production over the next coupe of years would be increased to hit the targets of 55,000 -60,00 tonnes a year over a 340 day, round the clock operating cycle, requiring more than 300 million litres of Gippsland milk.
Mr Donnison said competition for milk supplies in that region had been intense but had stabilised over the last couple of years.
For their suppliers Mr Donnison said the Darnum upgrade represented good news because of the increased value in the manufactured output.
But Mr Donnison said market demands meant they would need a flatter supply curve from their farmers given the increasing demands from customers for fresher product year-round.
Competition for milk supplies in Gippsland is already intense but will lift another notch next year when Burra Foods and Itochu commission a new joint venture plant that will process 200 million litres of milk a yearwill.
The Fonterra upgrade will add 25 new full time jobs at the Darnum site.
