The benefits from Fonterra’s proposed milk production plan for Studholme will flow into North Otago and have a positive impact for the whole area, Waitaki District mayor Gary Kircher says.
Up to 250 new jobs could be created in South Canterbury if a proposal to build two new high-efficiency milk powder driers at Fonterra’s Studholme plant goes ahead.
Fonterra has started the consultation process with the view of lodging consent applications.
The proposed investment would bring a significant boost to milk processing in South Canterbury, one of New Zealand’s fastest growing dairy regions, with around 9 million litres of additional capacity to help keep pace with rising milk volumes.
Mr Kircher said the plan would not only be positive for Waimate but also for North Otago some of the jobs would have to be filled from people in the Waitaki District.
“Overall I think it’s definitely positive news, especially for the Waimate District,” he said.
“It’s good to see the potential for those jobs there.
“I’d certainly expect some of the people required will come from our area.”
In terms of job opportunities, things were going well in the Waitaki District, and this would just add to it, Mr Kircher said.
Waimate Business Association chairwoman Beverley Knowles said an initiative like this would be of great benefit to businesses in Waimate and the town itself in general.
“It would be very exciting and absolutely wonderful for the town.”
Federated Farmers South Canterbury dairy chairperson, Ryan O’Sullivan, said it was also good news for the industry and local contractors.
“Fonterra obviously see more milk growth coming from that catchment. It will give them more processing capacity,” he said.
“Fonterra are currently processing 89 million litres per day nationally and peak production seems to be getting longer and longer as farmers are getting better at what they do. They used to say the peak lasted for 9-10 days and now it lasts 3-4 weeks.”
Fonterra managing director global operations, Robert Spurway said upgrades would bring an injection into the local economy and are an exciting prospect for those living in and around Studholme and Waimate.
“As with any build of this scale, local employment would be one of the major winners. With each new drier our site and tanker staff would grow by around 125 new positions, with builders and contractors to complete the build factored in on top of that.”
Mr Spurway said the expansion would play an important role in delivering the co-operative’s growth strategy.
“With the steady increase in milk production, a strong schedule of capital investment in processing and manufacturing will be key to delivering on our V3 strategy – driving value, volume and velocity.
“Should it go ahead, the investment at Studholme will bring much needed processing capacity to the South Island as well as optionality to make the products that bring the greatest returns to our shareholders.”
Mr Spurway said the Studholme site, due to its location, is the ideal option for the proposed development.
If approved, the expansion will take a phased approach, with construction beginning on the first drier within the next five years, followed by the potential installation of a second drier within the next 10 years.
Mitigating environmental impacts is a high priority for the build with plans including a range of wastewater treatment options, with particular care given to the nearby Wainono lagoon. Fonterra is also looking to minimise the use of coal, and is investigating options for energy efficient boilers capable of burning biomass.
Waimate District mayor Craig Rowley was unavailable for comment.