Fonterra Plant Advances Value-Add Manufacturing Technology

Fonterra Co-operative’s new processing plant, opened today (October 19) at Hautapu, will provide a major new dimension to the company’s value-add manufacturing capability.

Project manager Rob Boswell says the leading-edge milk protein fractionation technology will be used initially for extracting lactoferrin, a high value component of milk which has an important role in boosting the body’s immunity.

But, he says, extraction of lactoferrin is just the first step in developing Fonterra’s capability to extract bioactives. Bioactives are high value, minute components of milk which are beneficial to human health and are a major driver of Fonterra’s value-add ingredients business in key markets.

“The really exciting thing is that we will be able to use this technology to extract other target protein fractions or bioactives. The Hautapu facility provides a pipeline for future value-add, innovative specialty milk products and commercialisation of these,” he said.

Lactoferrin is in demand in Japan, Korea, China and Taiwan for its nutritional and immune-enhancing properties as an ingredient in a range of consumer products.

Products include infant formula, yoghurts, dietary supplements, specialty nutritional formulations, dermatology and dental products and even use as an additive in fresh milks to extend shelf life.

Fonterra’s Head of Health & Nutrition Patrick Geals says opening of the plant is a significant advance in Fonterra’s manufacturing capability, which will enhance key partnerships with global customers and provide new market opportunities.

“Lactoferrin will be to the dairy industry what aspirin has been to the pharmaceutical industry. Research shows that it is the body’s first line of defence against infections, it boosts the immune system and may have useful properties in the treatment of some tumours,” he said.

“New research by The University of Auckland’s Osteoporosis Research Group, supported by Fonterra, is also showing exciting, previously unknown functions relating to bone growth and inhibiting the cells that break bone down and absorb it.”

While the precise biological role for lactoferrin has yet to be fully established, Mr Geals says the single whey protein, found in the milk of most mammals, is the subject of intense scientific focus.

“There have been six global conferences solely dedicated to lactoferrin since 1992 to try to determine its biological roles or functions. This shows the extent of global interest and its importance,” he said.

Construction of the $15 million Hautapu plant began in March and lactoferrin production started in September. The process and design were developed in house at the Hautapu Development Centre by a team led by Karla Ward, senior product development technologist, and Mr Boswell.

Unlike commodity dairy products, annual production of lactoferrin and other bioactives is measured in kilograms, not metric tonnes.

“Lactoferrin is a very active protein fraction of milk, which is low volume but high value. It comprises only two hundredths of a percent of milk volume and is used as an ingredient in consumer products in minute quantities,” Mr Boswell said.

The total global market for lactoferrin is about 90 metric tonnes a year, with a selling price of US$300 a kilogram or more. About 80 per cent of market consumption is in Japan, followed by Korea with 14 per cent. Fonterra will initially launch the product in these two markets.

Fonterra’s Health & Nutrition division, a leader in the development of bioactive ingredients from milk, is one of the company’s five value add, specialty ingredient businesses.

The others include Pharmaceutical Lactose, which manufactures a fine powder used to carry the active ingredient in medicines, and Specialty Milks (including Organics) which is meeting consumer demand for organic, fresh produce with exports to customers in 44 countries.

Fresh Dairy Solutions, based in Mexico and Europe, is developing protein-based solutions for chilled dairy applications such as yoghurts and fresh, soft cheeses.

Fonterra’s fifth specialty ingredients business, DairiConcepts, a joint venture with Dairy Farmers of America, is leveraging Fonterra’s cheese flavour technologies to focus on the huge United States convenience foods market. Milk protein concentrate, manufactured at DairiConcepts’ Portales plant in New Mexico, is used as a base for a wide range of products, enabling cost-effective manufacture of more product from the same volume of milk.

Together these businesses are achieving target growth rates of 12 per cent a year, generating revenue of $500 million in the last financial year.


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