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Fonterra has completed an NZ$8 million investment in its UHT milk processing facilities in Auckland in a bid to meet growing demand in Asia and the Pacific, according to DairyReporter.com.

The upgrade and expansion of its Takanini plant has created a 30% increase in production capacity, which translates into the ability to fill an extra 600,000 packs of UHT milk every week, the report said.

Fonterra expects global consumption of UHT to increase at a compound annual rate of 5.2% through to 2012. This makes it one of the fastest growing niches in the industry and one that presents significant opportunities, the company was reported saying.

Much of this growth is coming from the Asian market, where Fonterra plans to focus its efforts. Limited domestic supply, growing populations and education about the nutritional benefits of dairy are all feeding demand for Fonterra’s products in Asia.

“With this increased production capacity, we will be able to expand our presence in our existing markets of China, Singapore and Hong Kong as well as start exporting in to new markets such as Malaysia, Indonesia and Vietnam,” said Peter McClure, managing director of Fonterra Brands New Zealand.

And Fonterra does not only plan to concentrate on basic dairy products in these Asian markets. McClure said: “We will also be looking to develop low fat and fortified UHT milks as we’re seeing the demand for these products emerging in developing markets.”

Fonterra began making UHT back in 1981 and had reached a production level of 27 million litres a year in 2005. Thanks to the booming Asian market that figure increased to 60 million litres last year. With this latest expansion, annual production is set to rise to 90 million litres. – Source: DairyReporter.com

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