Fonterra is to build two new cream cheese plants at its Darfield site in Canterbury over two phases. The first phase, which is a NZ$100m (€64m) investment, will be completed by August 2018. It will be a similar scale to the new cream cheese plant recently built at Te Rapa and will manufacture 24,000T of cream cheese each year for export.

The second phase will see an investment of NZ$50m (€32m) and is set to complete in 2019/2020, depending on market demand. It will also produce 24,000T annually.

Value-added products

This is an example of how Fonterra is shifting more of its focus to value-added products to tap into emerging markets. Fonterra’s chief operating officer for global operations Robert Spurway said: “This is not just about expanding our capability in manufacturing, it’s another marker in our strategy to continue delivering better returns to our farmers”.

Cream cheese is undergoing a steady surge in popularity in Asia. In China, dairy hasn’t traditionally been a staple. However, this is changing. In the major urban centres in China, people are shifting away from oils and actively seeking more dairy in their diet – whether in their cooking, as a table spread, or in a glass.

The food service industry is growing at 6% annually. Fonterra’s food service business has tripled over recent years. It has set a target of 20% year-on-year growth in food service sales.

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