Fonterra Australia plans to invest A$165m ($179.4m) across seven of its plants in Victoria and Tasmania.

This investment will boost the plant’s processing capacity by an additional 500 million litres of milk and ensure an annual processing capacity between 2.5 billion litres and 2.7 billion litres.

The dairy company plans to increase its annual milk quantity by 200 million litres by around March this year to meet rising consumer demands.

The Stanhope plant will receive an investment of $125m, which will boost its annual cheese production from 45,000t to 80,000t.

“This investment will boost the plant’s processing capacity by an additional 500 million litres of milk.”

Fonterra plans to invest $9.7m in the Wynyard plant in Tasmania to increase cheddar production by up to 8.5%, and another $7m will be invested at the Darnum plant to increase production of whole and skim milk powders.

The Cobden plant will receive an investment of $13.5m, which will boost butter production efficiency.

In addition, the Dennington plant will have an investment of $8.6m, which will be used to acquire a new 25kg packing line for milk powders. The Spreyton plant will gain an investment of $1.8m to boost lactose production, while the Bayswater plant will see an installation of two robotic palletisers.

Fonterra Australia managing director René Dedoncker was quoted by Weeklytimesnow.com.au as saying that the construction is currently underway.

Dedoncker added that the investments would enable Fonterra to deliver a “competitive farmgate milk price that is enduring.

“(This) absolutely builds the foundations of our business to a point, where I don’t worry about the ability to deliver a competitive farmgate milk price.

“We need to build the confidence of farmers over time that one day turns to trust and they need to see lots of things from us.”