News

$34 m Koroit plan

By Dairy News

LOCAL FARMERS stand to benefit with construction starting on a new $34 million lactoferrin plant at Bega Cheese’s Koroit site.

The new plant will create six to 10 ongoing permanent full-time jobs and potentially lead to higher milk cheques for suppliers.

Site manager Chris Evans said the lactoferrin plant would derive a high value protein out of Bega’s current milk pool with more potential for growth.

“It’s a fantastic development for the people of Koroit and surrounding districts and ultimately an investment such as this will hit the bottom line of farmers,” Mr Evans said.

“Once Bega pays for the initial outlays, farmers will see benefits through their milk price.”

The plant will extract and separate lactoferrin for use in manufacturing infant formula, producing more than 30 tonnes a year primarily for export markets.

Bega’s Tatura lactoferrin plant, which has been operating for nearly 20 years, is also being upgraded to raise its output to meet strong international demand for the product.

Bega Cheese bought the former Murray Goulburn Koroit processing plant for $250 million last year after Saputo was forced by Australia’s competition watchdog to sell it as part of its $1.31 billion buyout of MG. It will celebrate its first birthday in Koroit on August 17.

Mr Evans, who has worked on the site for 25 years, said the new plant was a show of confidence for the future of dairy in the region.

“It’s putting the site into a niche market with a high value-add and high-return product. It’s fantastic that Bega not only acquired the site but is willing to spend capital on its development,” he said.

There is enough supply in the current milk pool for the plant to be fully utilised across the year but Bega intends to chase more suppliers.

“The knowledge around lactoferrin is still in its early days and there are strong opportunities for growth,” Mr Evans said.

Bega executive general manager − ingredients, Mark McDonald, said the plant was on track to be completed March to June next year.

Mr McDonald said lactoferrin was a protein found naturally in milk.

“It naturally occurs in mother’s breast milk and provides immunity so there is a massive application for use in infant formula,” Mr McDonald said.

It also has wider usage possibilities to improve skin quality, grow hair, bone health and other immunities.

The vast majority of the Koroit product will go into infant formula export, with contracts already in place for international markets.

Mr McDonald said Koroit was an obvious site for Bega to expand its lactoferrin production.

“We’ve got adequate milk supply and Koroit has significant growth opportunities in the future,” he said.

In addition to construction jobs, there is strong demand for ongoing positions at Koroit.

HR business partner Matt Berg said there had been 782 applicants for six operator positions, plus a further 85 for lab technician roles.

“We thought there would be extra because of the Fonterra closure but that only accounts for 40 to 50 applications,” Mr Berg said.

“It’s a bigger job for us but it means we get a higher quality of applicants to consider.”

Most of the applicants are from south-west Victoria but there are also people looking to relocate from Melbourne.

When the new plant is operational, the site is expected to have 132 employees.

There will be six extra operators for the new plant and there could be more positions in support services such as maintenance and quality control.

“It’s looking really positive for us at the moment,” Mr Berg said.

“The site has had more recruitment in the past six months than it had in the previous five years. It’s better to be on the recruiting end than the other way around.”