Synlait boosts lactoferrin capacity
Synlait Milk has secured a multiyear supply agreement that will underwrite an investment of about $18 million to double lactoferrin manufacturing capacity at its Dunsandel plant, near Christchurch.
The company said the lactoferrin supply agreement was with a confidential customer.
Lactoferrin is a naturally occurring milk protein with antibacterial and anti-inflammatory properties and is commonly used in infant formula products.
The Dunsandel plant expansion is expected to be completed by October. Synlait observed in its interim results for the financial year that a demand and supply imbalance was driving global strengthening of lactoferrin prices.
Demand was being driven by increasing use of lactoferrin in infant formula, particularly in China.
Synlait managing director and executive officer John Penno said lactoferrin was a high-value speciality ingredient used in a range of nutritional food products around the world. The agreement was a major step forward for the company’s growing lactoferrin business and ‘‘delivered’’ on its strategic commitments, he said.
‘‘We’re deliberately building our lactoferrin business with stable, long-term growth in mind.
This agreement is a major step forward in this direction and continues to build our credibility as a producer of speciality dairy nutrition ingredients to worldleading nutritional companies.’’
Penno said the investment decision to double the company’s lactoferrin manufacturing capacity was underpinned by a strengthening global market, growing internal demand for the company’s infant formula and a strong portfolio of customers. Lactoferrin commanded a higher price per metric tonne than many other dairy-based ingredients because of its special functional properties and the complexity of its production.
Group category manager Dr Elizabeth Reid said Synlait was one of the few producers offering reliable access to large amounts of infant grade lactoferrin. ‘‘It’s a coveted position we’ve worked towards since we started producing lactoferrin in 2014.’’
Customers use lactoferrin in a range of products from health supplements to infant formula. Last year Synlait became the second company to receive a Generally Recognised As Safe notice from the US Food and Drug Administration to export its lactoferrin to the United States for use in infant formula and toddler formula.