Fonterra sells Dennington site to ProviCo.

Fonterra Australia has signed a sale agreement for its Dennington milk processing plant to Australian-owned animal nutrition manufacturer ProviCo.

In May 2019, Fonterra announced it was closing the site to consolidate its western Victoria manufacturing operations (Food & Drink Business, 24 May 2019).

ProviCo is Australia’s largest supplier of calf milk replacers, manufacturing a range of feed and vitamin fortified products for animals including cattle, dairy, sheep, horses and pigs.

ProviCo MD Andrew Paterson
ProviCo MD Andrew Paterson

ProviCo MD Andrew Paterson told Food & Drink Business the facility would enhance its existing manufacturing and distribution footprint and support the company’s product ProfeLac branded milk replacers.

“We had been looking to expand our range and capabilities for a number of years – either to build or to buy and existing facility as we had identified a gap in the market for some time. This will be the only factory of its kind in Australia as we seek to replicate what is already happening in the US and Europe.

The company owns and operates a milk powder blending, packing and logistics facility in Laverton. It will use the Dennington site to manufacture a range of animal nutrition foods that deliver health and performance benefits for infant and production animals.

Paterson said: “We are a protein, vitamin company, so effectively making infant formula for animals. Anything related to nutrition, protein and vitamin fortification are areas we are expanding into. This is becoming more and more relevant around the world when we see cross-species transmission viruses like Swine Flu, COVID-19 and SARS.

“We have an established export market, but we see this expanding due to those factors. Other countries see our food as premium quality and we see the same attitudes towards our protein IP in regards to animal husbandry.”

Paterson said that the sale will create new jobs for the Dennington community and provide environmental benefits for the agriculture industry. When Fonterra closed the site 98 people lost their jobs.

“We’ll be employing local people and will work with local training institutions to provide on-the-job skills training to create further employment opportunities for the community.

“It is a difficult time for Australian farming and manufacturing but even in challenging times, we want to demonstrate ProviCo’s commitment to manufacturing in Australia and continuing Dennington’s proud heritage and century long contribution in regional Victoria,” Paterson said.

Paterson said ProviCo has strong environmental credentials. He said: “We are active in the circular economy, focusing on salvaging raw materials and turning them into animal nutrition products. This helps the food industry minimise their waste costs and ProviCo’s products improve farm performance and health of animals and soils.

“Our focus is on sustainable dairy and the circular economy. This, combined with environmental benefits and innovative products will be a large part of our activities at Dennington as well as new jobs for the local community.”

Fonterra Australia MD René Dedoncker said the sale was good news for Dennington and its surrounding community. “We’re pleased to be selling the factory to ProviCo with all of its operational capabilities and assets intact. The sale creates a new chapter for the factory, which has been an important part of the Dennington community for more than 100 years,” he said.

Paterson also actively farms more than 2000 acres in Gippsland, Victoria. “I am passionate about value adding Australian primary production and sustainability in food and agriculture,” he said.

The sale will be complete by 22 April 2020.