New Zealand-based dairy giant Fonterra and Swiss food major Nestle have opened a new dairy distribution facility in Araras, Brazil, with an investment of NZ$45m.
The facility was set up through the companies' South American joint venture Dairy Partners Americas (DPA), which was formed in 2003 to procure about two billion liters of milk annually. It has been built on the site at DPA's Araras factory that produces chilled dairy products, including yoghurts, desserts and cream cheese.
It is expected that over 200,000 metric tonnes of dairy products would pass through the facility every year.
The new distribution center, when combined with the production and cooling site, will allow Fonterra to lower distribution costs, reduce carbon emissions and move products quickly across Brazil.
Fonterra CEO Theo Spierings said that Brazil is an important market for Fonterra.
"Rapid urban growth and a focus on healthy nutrition are driving demand for dairy products and we continue to invest significantly in the region through our partnership with Nestle and by developing selected milk pools," Spierings added.
Apart from extending its business portfolio, the DPA partnership will also allow Fonterra to work with dairy farms in the region to improve milk quality.
