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Dairy giant Fonterra has unveiled plans to invest NZD 150 million (approx. $92.9 million) to build a new UHT cream plant at its Edendale site in Southland, New Zealand.

The investment is part of the co-op's strategy to grow further value by expanding its Foodservice business in Asia and increasing production capacity for high-value products.

Fonterra’s foodservice business in Asia is booming due to consumers integrating dairy into traditional foods such as laksa and milk tea. In Malaysia, Fonterra is looking to build on its solid foundations – half of New Zealand exports to the country are dairy.

The new plant will initially create more than 50 million litres of UHT processing capacity with the ability to grow beyond 100 million litres by 2030 and will create 70 new jobs.

Fonterra’s CEO Miles Hurrell said: “Demand for UHT cream continues to strengthen. Globally, we’re expecting demand to increase by more than 4% year on year between 2023 and 2032...We believe prioritising our Ingredients and Foodservice channels will create more value for Fonterra and this expansion is a good example of the direction the co-op is heading.”

Last week, the dairy giant announced plans to expand its Studholme facility in South Island, New Zealand, aiming to enhance its production capabilities for high-value protein ingredients, with an NZD 75 million (approx. $47.13 million) investment.

Fonterra’s COO Anna Palairet added: “The Edendale site is well set up for future growth with decarbonisation work well underway along with a good supply of high-quality cream in the region. The additional processing capacity will allow us to manufacture more UHT cream products and grow value for farmers.”

Palairet continued: “Adding to the six new roles created through the recently announced expansion at our Studholme site, we will create an additional 70 new jobs with this new plant at Edendale. This is great news for the local community.”

Additional employment opportunities will also be created through the construction phase, which is scheduled to start early next year. Fonterra expects the first product to come off the line in August 2026.

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