$235m growth plan approved at Pahiatua

NEW WORKS: Heart of the Fonterra Pahiatua milk powder factory, which is about to get bigger.

Fonterra has announced board approval for a $235 million investment into a new high-efficiency milk powder plant at its Pahiatua site.

The project, announced a year ago, received consent from Tararua District Council and Horizons Regional Council, but was appealed to the Environment Court.

The appeal was withdrawn, meaning Fonterra has the go-ahead subject to resource consent conditions.

The new dryer will enable the dairy co-operative to process an additional 2.4 million litres each day.

Fonterra's director of NZ operations, Robert Spurway said the co-operative's continued investment in milk powder dryers was to meet the demand for dairy nutrition globally and demonstrated Fonterra's strategy of optimising its New Zealand milk business.

"This new dryer in Pahiatua will help drive greater efficiencies across our manufacturing footprint.

"Last season we set a new record for the most milk collected in one day and overall milk production has been increasing by roughly three per cent each year. This dryer will help us process the extra milk in a way that delivers the most value to our farmers," Mr Spurway said.

Mr Spurway said Pahiatua's new dryer will use the latest energy-efficient processing technology and be the first in the country to reuse its own condensate. The wastewater it creates will also be treated and used for irrigation.

Tararua Mayor Roly Ellis said Fonterra's announcement was exciting news for the community and would create new opportunities for local residents.

"This expansion will mean another 45 full-time jobs for the local community. That's on top of the hundreds of builders, labourers and others who will be working during the construction phase," Mr Ellis said.

"Fonterra's investment and the possible construction of the Ruataniwha dam is good news for our local dairy industry and will provide a welcome economic boost for the region."

Preliminary earthworks have begun at the site and construction of the dryer and associated infrastructure will start in mid-December.

The first milk powder from the new dryer is expected to roll out of the site by September 2015.