Construction of Yashili New Zealand infant formula plant complete: GEA

14-Oct-2015 - Last updated on 15-Oct-2015 at 13:07 GMT

Yashili's completed infant formula plant in Pokeno, New Zealand.

GEA has completed construction of Chinese infant formula manufacturer Yashili's first plant in New Zealand.

Operations at Yashili's NZ$200m (US$137m) infant formula plant in Pokeno, which boasts a capacity of around 52,000 tonnes per year, have already begun.

Guangdong-based Yashili was given the go-ahead to build the plant by the New Zealand Overseas Investment Office (OIONZ) in April 2013.

Construction, which began in September 2013, was completed "on time and on budget," GEA said in a statement.

"We have succeeded in including interesting innovations for Yashili," said Chris Burt, engineering manager for GEA in New Zealand.

"These have combined to optimize the plant in terms of its productivity, flexibility, and sustainability. It really is a world class facility," Burt added.

The plant, which will produce infant formula for the increasingly demanding Chinese market, contains a variety of GEA technology.

Milk that arrives at Pokeno is pre-treated before the addition of ingredients, including vegetable oils, dairy powders, carbohydrates, vitamins and minerals.

Batches of the formulation are cooled, then concentrated through the "gentle removal of water under vacuum" using GEA tubular falling film evaporators. The resulting milk concentrate is then spray-dried in a GEA MSD dryer to produce a powder, which is then packed into 25kg bags using GEA Avapac technology.

“We have a plant here that represents the best in class in many aspects and that produces an excellent product,” said Terry Norwood, operations manager, Yashili New Zealand. “GEA has been a great partner in this project.”

Chinese acquisitions

Yashili has in recent months taken several steps to establish its position among China's top infant formula producers.

Last month, it agreed to acquire Oushi Mengniu from its majority shareholder, Mengniu, for RMB 1.05bn ($165m) cash.

Oushi Mengniu, a wholly owned subsidiary of Chinese dairy giant Mengniu, manufactures and markets infant formula products and milk powder products for adults.

Through the deal Yashili expects its market share to increase and competition with its parent company, Mengniu, to reduce.

Mengniu, China’s second largest dairy processor, currently holds a 51.4% interest in Yashili.

Earlier this year, Danone, which controls a further 25% stake in the company, announced it had reached a “preliminary agreement” with the Yashili on the sale of its infant formula business, Dumex China.

As detailed in a Memorandum of Understanding (MOU) signed by Danone, Yashili and Mengniu in July, the French dairy will use proceeds from the proposed sale of Dumex China to increase its 9.9% interest in Mengniu.