Apr 19, 2014
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Fonterra Announces $32 Million Foodservice Expansion

February 19, 2014
Fonterra Whareroa factory with Mt Taranaki
  
 
 

The New Zealand dairy giant will increase sliced cheese capacity to meet global demand.

Source: Fonterra

Fonterra today announced a $32 million expansion of its slice-on-slice cheese capacity at its Collingwood Street site in Eltham, Taranaki.

Slice-on-slice cheese is used extensively in quick service restaurants for products such as hamburgers and sandwiches.

Work will start in early 2014 and is expected to be completed in mid-2015. When complete, the expanded plant will deliver both increased capacity and improved processes to meet growth in global demand from Fonterra’s foodservice customers.

Fonterra Director of Foodservice, René Dedoncker, said the investment demonstrated the cooperative’s drive to grow its business in the high-value foodservice industry.

"Our foodservice business has grown 9% in volume over the past three years and the profitability of foodservice has increased 11% in the same period," said Dedoncker. "This investment in slice-on-slice cheese is in response to fast-growing demand throughout Australasia, Asia and the Middle East."

International growth in cheese is being driven by trends in eating out of home, particularly in emerging Asian economies where there is a continued shift toward more Westernized diets.

"Our results last year showed a 45% normalized EBIT growth in foodservice for our Asia, Africa and Middle East business," he said. "We also achieved double digit growth in China where foodservice grew 28%."

Dedoncker said driving its foodservice business is one of Fonterra’s seven strategic pathways and the cooperative had set itself ambitious growth targets over the next five years.

The foodservice category includes full and quick service restaurants, bakeries, cafes, hotels, airline catering facilities and other commercial kitchens.
 

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