Fonterra is investing $150 million into construction of a new Ultra High Temperature processing (UHT) cream plant at its Edendale site in Southland to meet growing demand through its Foodservice business in Asia.
The formulation for this cream, renowned by its performance and stability, was developed by Fonterra’s Research and Development Centre, an example of how Fonterra uses innovation to add value to farmers’ milk.
By extending new applications to local cakes, puddings and beverages, where coconut milk is traditionally a staple, it helps to extend shelf-life of consumer products.
Fonterra CEO, Miles Hurrell, shared the news while in Malaysia on a senior New Zealand business delegation with the Prime Minister.
Fonterra has a thriving Foodservice business in Asia where demand is growing by integrating dairy into traditional foods such as laksa and milk tea. In Malaysia, Fonterra is looking to build on solid foundations where half of New Zealand exports to the country are already dairy.
Hurrell said the investment is part of the Co-operative’s strategy to grow further value by expanding its Foodservice business in Asia and increasing production capacity for high-value products.
“Demand for UHT cream continues to strengthen. Globally, we’re expecting demand to increase by more than 4 per cent year on year between 2023 – 2032*,” said Hurrell.
“This is the second announcement we’ve made in as many weeks about expansions at our sites to cater for growing demand.
“We believe prioritising our Ingredients and Foodservice channels will create more value for Fonterra and this expansion is a good example of the direction the Co-op is heading,” he said.
The new plant will initially create upward of 50 million litres of UHT processing capacity with the capacity to grow beyond 100 million litres by 2030.
Fonterra COO, Anna Palairet, said the Edendale site is well set up for future growth, with decarbonisation work well underway along with a good supply of high-quality cream in the region.
“The additional processing capacity will allow us to manufacture more UHT cream products and grow value for farmers,” said Palairet.
“Adding to the six new roles created through the recently announced expansion at our Studholme site, we will create an additional 70 new jobs with this new plant at Edendale. This is great news for the local community.”
Additional employment opportunities will also be created through the construction phase, which is scheduled to start early next year. The first product is expected to come off the line in August 2026.
