Food Waikato attracts top-tier investment to fund new spray dryer to grow the sheep milk industry

Due to predicted growth in the sheep milk industry Food Waikato has invested in a new company, Melody Dairies Ltd Partnership. This investment will boost the nutritional spray drying capacity at Waikato Innovation Park in Hamilton. 

Melody Dairies’ four investment partners will jointly finance and build a second spray dryer at the Park, which will be managed by Food Waikato. 

The four partners are Nu-Mega Ingredients (NZ) Limited, a company owned by Clover Corporation Ltd, with a 35 per cent stake in Melody Dairies; Landcorp Farming Limited, with a 35 per cent in the partnership; Dairy Nutraceuticals Limited, with a 20 per cent share; and Food Waikato, also known as New Zealand Food Innovation Waikato, with a 10 per cent share.

Clover Corporation is an Australian company listed on the Australian Stock Exchange. It is known for its range of patented micro-encapsulated products containing omega three oils, created through the spray drying process, used in the manufacture of high-quality infant formula. 

“We are delighted to attract an investor of this calibre who has leading-edge, patent technology in the specialist ingredients area,” said Food Waikato CEO Stuart Gordon. “We look forward to continuing the strong relationship we already have with Clover Corporation.” 

Clover Corporation have been a customer of Food Waikato since 2014, regularly utilising the first spray dryer built at the Park. 

Clover Corporation’s CEO and managing director, Peter Davey, said its investment in Food Waikato will help the company meet the fast-growing demand for its products from both the infant formula and functional food markets. The partnership allows Clover use of the facility for spray drying its products.

The investment from other partners, Landcorp and Dairy Nutraceuticals Limited (DNL), is also significant for Food Waikato. 

“It’s a mega coup for us as Landcorp implement their Pāmu Farms of New Zealand brand strategy, in particular their joint venture with Spring Sheep Milk Company,” said Mr Gordon. 

Pāmu is the brand name for the government State-Owned Enterprise (SOE) Landcorp Farming Limited which owns a nationwide portfolio of farms including sheep farms. They are partners in Spring Sheep Milk Company, a boutique nutrition company which creates and exports high-value branded nutrition food products made from sheep milk.

Gordon said that the sheep milk industry was expected to double in size by the year 2021, and a new spray dryer will be in demand.

“Dairy Nutraceuticals Limited have just built a state-of-the-art blending and packing plant in Auckland, and they also lead the way in technology and innovation, so it’s an ideal partnership.”

Established in 2016, DNL is a New Zealand-based dairy processing and nutritional food manufacturer with a focus on innovation and pioneering new products to local and global markets.

The Food Waikato plant opened in May 2012. The existing open access development dryer is running at capacity, with 300 days of production for the year to June 2018, producing $51 million in export product for the year. 

The existing dryer will continue to be available to develop new businesses and products, with increased capacity available through transfer of some clients to the new dryer, due to Food Waikato’s 10 per cent ownership of capacity in it. 

The new $50 million industrial spray dryer will be built alongside the existing dryer and will have 2.4 times its capacity. It is projected to deliver $129 million in exports a year. 

“This is an exciting moment for the growth of the sheep milk industry, and we are proud to be part of that growth,” said Mr Gordon. 

He said that sheep milk had “three key points of difference” which was helping to drive its commercial and export appeal. “There is emerging evidence of a lower environmental footprint than bovine dairy; there is evidence that sheep’s milk is more easily digested than cow’s milk; and it has a great taste,” said Gordon.

He was proud of the work that Food Waikato had already achieved for the industry. 

“The Food Waikato plant has become a centre of excellence for the industry, and we have supported many companies with their product development to take high-quality New Zealand food innovations to a global market,” said Mr Gordon.

The new dryer will be designed and built by Waikato Innovation Park tenant company Tetra Pak, and construction will begin in late 2018. Mr Gordon said the spray dryer will be up and running by December 2019. 

Once completed it is expected employment at the plant will grow from 17 to 35 staff.