OIO approves Waikato's 15th dairy plant, clears Singapore's Olam to build

Singapore's Olam no newcomer to New Zealand agriculture industry.

Singapore company Olam has the green light from the Overseas Investment Office for a $100 million-plus dairy processing plant build at Tokoroa in south Waikato.

Its recently incorporated subsidiary Olam Food Ingredients New Zealand has said it plans to begin operating the site in the third quarter of 2023.

The milk processing site will be the 15th in the Waikato.

The company has said the new plant was expected to create 50-60 fulltime jobs when fully operational.

Olam is no newcomer to New Zealand and OIO approval of its application was expected.

It was until early this year a shareholder in New Zealand's second biggest dairy processor and exporter, Open Country Dairy.

It also owns 100 per cent of the shares in NZ Farming Systems Uruguay, a New Zealand-incorporated agricultural company that applies Kiwi pastoral farming systems to Uruguayan farms.

The OIO said Olam did not need its consent to buy the 11.8 hectare, industrial-zoned property for the factory build in Tokoroa's Browning St. It is not sensitive land under the OIO Act.

But as a business intending to operate for more than 90 days in any year and given the total spend of $100m-plus before the business started, it needed OIO consent.

Olam bought the site from Danish company SicciaDania NZ, which had acquired consents for a dairy plant.

The new plant would produce dairy ingredients for overseas food service markets, the company has said.

Parent company Olam International, a global food and agribusiness operation, is 53 per cent owned by Temasek Holdings Singapore, which is 100 per cent owned by the Singapore government.

Olam's financial interest in the New Zealand dairy industry goes back around 13 years.

It first bought into Open Country Cheese, which became Dairy Trust, in which Olam had a 25 per cent stake. Dairy Trust became Open Country dairy in 2008.

Early Open Country Cheese investors, Motueka's Talley's Group, now owns 100 per cent of Open Country Dairy, early this year buying out Olam's stake, by then reduced to 15.1 per cent for $80.9m.