New Zealand Fonterra’s Pahiatua Dairy Plant To Add Significant Capacity: Production To Start From August

World’s biggest dairy exporter and New Zealand’s globally famous dairy cooperative Fonterra's is getting ready to open its multimillion dollar, brand new powder plant at Pahiatua. It will be giving the dairy major a massive capacity boost. The plant will produce 140,000 tonnes of whole milk powder a year and the first milk from the new plant is expected towards the end of August.

The commissioning of the plant will put an end to the familiar milk train from Oringi, south of Dannevirke. "Our production capacity will increase by 2.4 million litres a day to a high of 3.8 million litres at the peak of the dairy season," said Bill Boakes, site manager at Pahiatua.

Key Features

Pahiatua will be New Zealand’s and world’s first in withstanding earthquakes, thanks to the triple-pendulum base isolation system put up allowing the plant to move 400cm in each direction on 50 rubber isolators, each weighing three tonnes. “We're on time and looking good," Boakes said. Another significant feature of the new plant will be its drive to reduce environmental footprint, Boakes said and noted that there are significant efficiencies in running a bigger plant with export volumes expanding by another 85,000 tonnes and Tauranga becoming a growing port for Fonterra.

One of the world-leading innovations in the plant will be robots stacking 25 kg bags of milk powder, with unmanned, automatic-guided vehicles taking the pallets from the product line to the marshalling area, that is 250 metres away. The 21,000 sq m distribution centre will have separate environmental load out store for taking 10 railway wagons inside, with 30 wagons shipping out on a daily basis.

Assured Prices

Meanwhile, Fonterra Cooperative Group got a huge response from farmers and farms on its offer to take supply of milk for a guaranteed price for the upcoming season, compared to the last season, amid uncertainty on the recovery in global milk prices.

Fonterra started offering a guaranteed milk price since 2013 to offer farmers more surety on what they get paid for a portion of their milk supply, given the ongoing volatility in global market prices. The scheme has provided the farms greater surety over a portion of the milk input cost and allows for locking in on longer-term supply contracts at set prices.

For the coming season, a total of 45.2 million kilograms of milk solids has been offered by 443 farms, exceeding the 40 million kgMS available under the guaranteed price. It shows an excess of 180 farms compared to June 2014 and the offer is to sell 26 million kgMS. Fonterra has set its June guaranteed milk price at $5.25/kgMS for the 2015/16 season.

(For feedback/comments, contact the writer at k.kumar@ibtimes.com.au)