Murray Goulburn to build $224m milk powder factory in Victoria, Australia

Dairy cooperative Murray Goulburn (MG) has announced plans to construct a milk powder facility at Koroit in south-west Victoria, Australia, with an investment of approximately A$300m ($223.8m).

As part of this, it has signed two agreements with international firms Kalbe and Mead Johnson, in order to supply milk powder to be used in infant formula for export markets.

The first phase of the Koroit plant is expected to become operational in early 2019, reported Reuters.

It will have an initial production capacity of 45,000t of powdered formula a year.

Murray Goulburn managing director Gary Helou was quoted by ABC.net as saying: "The build will occur in two stages; the first stage will give us a capacity of 45,000t, which will be complemented by another stage will take us to the 90,000t."

Once completed, the plant is expected to supply its finished products to be sold in the Asia-Pacific region, including China.

Helou added: "Ingredients as commodities are very volatile and unpredictable, so we have been methodically moving away from those commodity markets to more stable higher value-added dairy products.

"We’ve already converted our portfolio to the point that today, we have 70% of our products going to those products.

"This will give us sector-leading capabilities in supplying the highest quality nutritional powders into those growth markets like Asia."

According to the company, investments in high-technology products will help develop sustainable high farm-gate prices.