Devondale Murray Goulburn’s A$19 million (US$17.5 million) investment at its facility in Koroit, Australia will increase its capacity to produce nutritional products destined for consumers in Asia.
The investment forms part of a larger A$127 million (US$117.2 million) capital investment, announced by the company’s MD Gary Helou in May 2014.
The Koroit site – which is the largest dairy manufacturing facility in Australia – currently produces approximately A$600 million (US$553.7 million) annually of premium, mainly export destined, dairy products including powders for infant nutrition and bulk ingredients; retail butter, bulk butter, and retail milk powder.
Helou said Devondale Murray Goulburn had identified the growth of nutritional products, such as infant formula, as a significant opportunity to add value above commodity milk powders to customers in China and Southeast Asia.
“Among the products that are driving demand are nutritional milk powders, particularly baby and follow-on formula for toddlers,” he said.
“Global demand for infant formula is expected to increase by more than 4% in 2017. Follow-on formula is expected to grow by more than 6% and growing-up milk powder will exceed 7% growth.”
The investment at Koroit will increase the capacity to produce these products by installing the necessary capability on existing production lines.
It also secures sustainable, skilled jobs in the region and current staff will be trained to produce the new, higher value-add products.
The company says work has already commenced on the project, which is expected to be fully operational by May 2015.