Breakthrough in baby milk market

Neil McGarva has achieved a world-first winner for Hawke's Bay, by developing bottled UHT baby's milk with a teat that can sit on a shelf for six to 12 months.

With the help of local investors and Malaysian conglomerate Etika, a state-of-the-art UHT Aseptic PET bottling plant in Whakatu will start production in October.

Costing tens of millions of dollars, the plant delivers what New Zealand economists dream of: added value for farm produce.

At the official opening by Prime Minister John Key yesterday, Mr McGarva said he had been surprised to find there was no maker of such products in New Zealand, so decided to do it himself.

"My attitude was, 'how hard can it be?' Six years later my answer is: bloody hard."

Mr Key said he noticed Whakatu firms were increasingly becoming high-tech knowledge companies "making the most of modern New Zealand".

Bottled baby's milk has grabbed the attention of Asian buyers, but other sterilised products not needing refrigeration included flavoured milk, lactose-free milk, standard milk, energy drinks, infant water and fruit juices.

An in-house crusher would process apples and kiwifruit from nearby orchards.

Milk supply was not a problem, despite the review of Fonterra's obligation to supply raw milk to competitors.

"In Hawke's Bay there is no dairy facility so it suits Fonterra to have us; it saves them quite a bit of cartage," Mr McGarva said.

The plant would provide about 30 jobs when in full production, which should not be too far off - most of the first production run has been pre-sold.

Malaysian partner Etika is listed on the Singapore stock exchange and is one of the world's largest manufacturers and distributors of sweetened condensed milk. As a food and beverage company it is a leader in South East Asia with an extensive distribution network.

Both Mr Key and Mr McGarva thanked Etika for their faith and foresight. "Their support has been unwavering," Mr McGarva said.

Des Ratima spoke for the people of Whakatu. He pointed out the word Etika had the same meaning in Malay as Maori - correctness.