Speculation grows about plans to expand milk powder plant

GROWING?: The Open Country plant in Heads Rd, Wanganui. Photo/Stuart Munro

Speculation is growing that Open Country Dairy is on the verge of expanding its Wanganui milk powder plant.

OCD opened the single drying tower plant in 2009 with the first tanker-load of milk arriving on July 31 and the first bag of powdered milk coming off the production line on August 1.

The dairy company will not speak on the record about the future at the Heads Rd plant, but Dairy Fresh - the transport company providing the tankers delivering milk to the site - has been advertising for more drivers and dispatchers for its depots in Wanganui and Taupo.

Dairy Fresh will not confirm why it is increasing staff but an expanded plant in Heads Rd would be an obvious reason.

And the Chronicle understands more warehouse space has also been secured by another contractor to handle the extra production from the city plant.

While the Wanganui plant produces solely milk powder, the Miraka company near Taupo produces powder and long-life milk.

Earlier this year the Waikato Times asked OCD chairman Laurie Margrain if the company - the country's second biggest behind Fonterra - had any expansion plans.

"We're very clear what our options are, and we'll make a decision at what we think is at a prudent time," Mr Margrain told the paper.

He said the company could expand at its existing sites or build new. Apart from the Wanganui plant, OCD has milk powder plants at Waharoa near Matamata and Awarua near Invercargill.

The company is building a multimillion-dollar expansion at its Southland factory to make room for a new dryer, understood to double production at the plant. It has three plants with a combined capacity of handling about 900 million litres of milk annually and exports to 50 countries.

OCD is a private company, majority-owned by New Zealand food group Talley's. It was formed in 2001 to take advantage of opportunities within the dairy industry following the passing of the Dairy Industry Restructuring Act (DIRA).

Its strategy has been to site its factories in the major dairying areas of New Zealand and it is now supplied by more than 500 dairy farmers.