What Would Synlait Be Worth to Fonterra or a2 Milk?
Speculation of a possible joint move by Fonterra and a2 Milk to buy Synlait raises a much bigger strategic question, says agribusiness expert Dr Nic Lees.
Fonterra director operations – NZ Milk Products Brent Taylor says it was a smooth start for the new milk powder plant, which produced 40 metric tonnes in its first full day of operations.
"It has taken less than two years to bring the project together and it is a significant achievement for the co op and good news for Canterbury and the wider Christchurch rebuild," he says.
"More than 1500 people have been involved in construction of the first drier and all their hard work has paid off.
"With a current annual growth rate of around 5-6%, Canterbury is New Zealand's fastest growing region for dairy. And with our combined investment of $500 million across stage one and two at Darfield, we see a strong future in Central Canterbury," says Taylor.
The new manufacturing site will play an important part in the co-op's strategy to optimise its New Zealand milk business.
"We collect milk from our farmers, who are among the best in the world at turning green grass into fresh milk, and turn it into high quality product with world-class efficiency."
Fonterra Darfield is the co-op's first new site in 14 years and has been fitted with world-leading innovation and technology.
"The drier has been built by GEA Process Engineering to produce 15MT per hour but, once installed, we add our own intellectual property rights – call it our x-factor," says Taylor.
"This helps keep our farmer-shareholders internationally competitive and is aimed at driving more value their way."
At peak capacity, Darfield Drier 1 will convert about 2.2 million litres of milk per day into 370MT of whole milk powder. Stage Two of the site's development includes extension of the site's dry store as well as the commissioning of a second 30MT per hour milk drier which will triple the site's capacity.
Background facts
• Fonterra Darfield is located near Racecourse Hill in Darfield, 800m from State Highway 73.
Around 7700m3 of concrete and 1200MT of steel has been used in the construction of Darfield Drier 1.
• About 85km of stainless steel tubing has been installed – enough to cross Cook Strait three times.
• It took one million man hours to complete, the equivalent of 10 people working full time for 50 years.
• The site will produce high-quality instant and regular whole milk powder (WMP), destined for countries in Asia and the Middle East.
• The 25kg bags are first packed onto pallets then into containers and delivered to port.
The new site will reduce the distance Fonterra milk tankers need to travel by 20,000km per day.
