Australia's largest dairy foods company, Murray Goulburn, has successfully signed two major supply deals with U.S.-based, global infant nutrition giant, Mead Johnson, and Indonesia’s leading nutritional company, Kalbe Nutritionals, according to ABC.

 

Although the exact length of the long-term offtake contracts was not disclosed, Murray Goulburn stated that they would position the company to enable it to construct a new $300 million nutritional powders plant in western Victoria to supply exports to Asian markets.

 

Once the terms of the contracts are finalized, Murray Goulburn plans to invest between $194 million and $226 million (A$260 million and A$300 million) on its new nutritional powders site, which will have the capacity to produce 90,000 tons of milk powder per year, and will also incorporate a packaging plant and a 45,000 tons dryer. If demand is strong enough to merit it, Murray Goulburn could build a second 45,000 ton dryer, reports the Weekly Times. When added to the company’s existing plant in Cobram that has the capacity to produce 18,000 tons of nutritional powders per year, Murray Goulburn will be have a leading infant nutritional hub from which to supply its global customers.

 

"Ingredients as commodities are very volatile and unpredictable so we have been methodically moving away from those commodity markets to more stable higher value added dairy products," Murray Goulburn managing director, Gary Helou told ABC. "We've already converted our portfolio to the point that today we have 70 per cent of our products going to those products This will give us sector leading capabilities in supplying the highest quality nutritional powders into those growth markets like Asia."

 

Although the company has a large existing pool of fresh milk to depend upon, Mr. Helou told ABC that it is open to adding more farmers to its pipeline to help it meet the needs of the new facility, which will intake nearly 1 billion liters of milk per year for the production of both skim and whole milk powders.