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Goodman Fielder plans $27m upgrade of Christchurch milk factory to meet Asian demand

Goodman Fielder [NZX: GFF], the Australian food ingredients maker, will spend $27 million to expand its Christchurch ultra heat treated milk plant, giving it additional capacity to meet increased demand for its Meadow Fresh brand in Asia.

Work to extend the existing UHT building and install a new pasteurising, sterilising and palletising line as well as a new 250ml high-speed filler is expected to be completed by October 2015 and will boost production at the site by 50 percent, enabling it to process an extra 32 million litres a year, Sydney-based Goodman Fielder said in a statement.

Increased demand for milk powder from China, driven by an expanding and wealthier population that is embracing western foods, has pushed dairy cooperative payouts to farmers to a record high and underpinned the conversion of traditional pastoral farms to dairying. Higher payouts are enticing farmers to increase milk production, and dairy factories are having to step up production capacity to cope with the surge.

"The premium UHT category in Asia Pacific is anticipated to grow by around 50 percent over the next five years," Goodman Fielder chief executive Chris Delaney said. "We are investing now to meet that demand and also plan for future growth."

Construction of the new building and production line will require 40 full-time equivalent roles for the 8-month construction period and the increased production will also require 12 new roles, the company said.

Shares in Goodman Fielder last traded at 74 cents and have gained 2.8 percent so far this year.

(BusinessDesk)

Comments and questions
1

Hasnt this and the previous labour government revolutionised NZ Inc with the free trade agreement we have with China.

China would have been purchasing our dairy food regardless. Its a convenient through away line by dodgy sitting MPS the free trade agreement facilitated this. Proof is most of the dairy exports are purchased by multinational companies that have maunfacturing plants in China, exploiting their slave labour.

How can NZ inc now say no to China, with their buy up in this country? They cant, because China can switch off this countries lights in a couple of days.

I wouldnt have a problem with it if they had the same rules and political system we have, but they dont and its not going to change anytime soon. Apart from backroom dealers, chinese people are hard workers and better than some of locals and other immigrants. They do however need to invest in their wider local community, rather than there family unit. They would then be appreciated more.

It might be time to learn mandarin shortly, because it wont be long before the majority of business is controlled by people who speak it.

Free market trade deals should only be done with countries which have a similar sized economies and a democrastically elected government. Denmark, Finland & Ireland are but examples. Otherwise, its all going to be one way traffic.