$72 million upgrade to meet mozzarella demand

Fonterra is spending $72 million at its Clandeboye mozzarella plant to cater for a growing food service business.

The investment is the final stage of a technology upgrade that will double the capacity of the Canterbury plant to produce individual quick-frozen (IQF) grated mozzarella.

When implemented, it will increase Fonterra's IQF mozzarella capacity from its two New Zealand plants to more than 50,000 metric tonnes per year.

Additional capacity is required to meet growing international demand, primarily in global fast-food restaurant chains, but also regional fast-food and fine-dining restaurants.

The manufacturing process used at Clandeboye was developed by the Fonterra Research and Development Centre.

The patented technology meant frozen natural shredded mozzarella could be made

from milk in a day, rather than two months taken by conventional mozzarella processes.

Growth in the global food service category was being driven by emerging Asian markets and was estimated to grow at about 13% annually to 2016, Fonterra food service director Rene Dedoncker said.

Demand for high-value dairy products was being fuelled by changing dietary habits, particularly in Asia where there was a significant move towards more Westernised diets, he said.

The Clandeboye plant upgrade will begin in mid-2014 and is due to be completed by September 2015.

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