Tuesday, 03 February 2026 09:55

Fonterra expands butter production at Clandeboye with $75m investment

Written by Staff Reporters

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Construction has begun on Fonterra’s $75 million butter plant expansion at its Clandeboye site in South Canterbury.

Fonterra is boosting its butter production capacity to meet growing demand.

Construction has begun on Fonterra's $75 million butter plant expansion at its Clandeboye site in South Canterbury.

The build is part of Fonterra's commitment to invest up to $1 billion over the next three to four years in projects that generate further value and drive operational cost efficiencies. The expansion is key to the Co-op's strategy to lift returns from high-value dairy through value-added milkfat products and improved product mix.

The project moved into a significant new phase in January, with the design stage nearing completion and on-site construction activity set to increase over the coming weeks.

Demolition has begun and will be followed by excavation, foundation and drainage works - paving the way for construction of the new butter process hall. At the same time, work will soon begin to install new pipes linking milk treatment to the butter line. Offside building of key equipment is tracking well. The exterior of the new building extension will start to become visible by April as the structural footprint takes shape.

Fonterra says the new butter line will increase capacity and expand the site's ability to produce a wider range of butter formats, including Halal and Kosher options, supporting demand from international ingredients customers and professional kitchens.

The investment also strengthens Fonterra's South Island manufacturing network by building greater flexibility and resilience into the Co-op's processing footprint.

Fonterra Clandeboye site manager, Ross Burdett, says the expansion is an exciting development for the site and local community.

"It's great to see construction underway.

"The new butter line will allow us to produce a wider range of butter formats for customers around the world, while creating 16 new jobs here in South Canterbury and strengthening the Co-op's South Island manufacturing network. It's a really positive step for our site and the Co-op."

Commissioning of the new line is planned for early 2027, with first product expected off the line in April next year.

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