Friesland Foods Domo has invested €6M in its whey protein plant in Workum, The Netherlands, allowing it to increase production of infant formula ingredients and produce its new low-fat ingredient for dairy applications.
Global demand for whey proteins is growing, largely thanks to its increasing use in nutritional and sports-oriented products. Moreover, high dairy prices mean dairy-derived ingredients are in high demand - yielding strong sales for companies active in this sector.
Friesland Foods Domo has previously produced whey proteins for infant formula from other facilities, but bringing Workum in line with the specific requirements for infant formula means the
A spokesperson for the Dutch company declined to give details of the capacity increase, but he said the infant formula market is largely driven by growing wealth in emerging economies like South East Asia and South America.
"The population there is still growing, unlike in developed countries. People want to give their children the best possible start," he said.
Another major element of the modernisation of the Workum factory is the construction of a new production line to make DOMO Hiprotal 60MP, a range of whey protein concentrates for low fat yoghurt developed in collaboration with Nandi Proteins. .
One per cent of DOMO Hiprotal 60MP is said to replace three per cent of milk fat. From a technological point of view it is interesting since less protein is required to achieve the same consistency. This translates to lower ingredient costs for food manufacturers.
In addition, the new ingredient is in line with low-fat ingredient trends, and the need for clean labels. Since they, themselves, are derived from dairy, whey protein concentrates do not need to be listed as additives.
Other features of the Workum facility upgrade include a new packaging line and packaging hall.
Friesland Foods Domo has designated whey- and milk-based ingredients as "one of the pillars of the company".
The spokesperson told FoodNavigator.com that the company is growing in this area, and sees itself as a more and more important player in the market.
As for the high dairy prices, in his view this is a short term issue in the context of a longer-term story of increasing demand.
The price of wholesale milk doubled between 2006 and 2007, which has had a knock-on effect on dairy derivatives - not only ingredients but also cheese, cream and butter.
According to a recent report from 3A Business Consulting, the market for whey products reached $6bn in sales globally last year. It predicted that the market for ingredients such as whey protein concentrate could experience three per cent to five per cent annual growth to 2010, but stressed that dairy groups need to focus on serving demand for value-added ingredients.
Workum is one of four whey protein plants owned by Friesland Foods Domo in The Netherlands. The others are located at Bedum, Borculo and Dromridg.
The company also announced this year that it is building a €30m factory in Australia through its joint venture with Warrnambool, called Great Ocean Ingredients.
This facility, too, is focused on the nutritional market - in particular to help meet demand for prebiotics such as Friesland's Vivinal GOS. This facility is expected to be operational in 2009.
The Netherlands-based multinational reported revenue of €2.4bn for the six month period, up 2.5 per cent on the same period last year. Net profit was up 36 per cent to €70m.