High-tech plant for world-class boutique dairy company

Synlait’s new $100 million state-of-the-art milk powder processing plant in Dunsandel commenced production on August 1. The plant, situated on SH1, halfway between Christchurch and Timaru, uses a GEA Niro multi-stage spray dryer to process milk into full and skim milk powder. It can produce 8.3 tonnes of milk powder per hour. Another smaller, purpose-built dryer unit, capable of producing 300 kilograms of product per hour, will be installed by April next year for specialist product runs. This season Synlait Milk will be sourcing the factory’s feedstock from 50,000 cows, 15,000 from its own farms and 35,000 from its suppliers. If required, it will buy in milk from Fonterra. Virtually all its suppliers are within a 50-kilometre radius of the Dunsandel factory, resulting in significant transport cost savings. The plant will process 200 million litres of milk in its first year, producing $150 million worth of high-specification milk powder, mainly for export to Asia. The plant belongs to Synlait Milk, which together with Synlait Farms forms the Synlait company, started in 2000 by founding shareholders Ben Dingle, Dr John Penno and Juliet Maclean. “With the boom in the dairy industry there’s been a lot of milk growth in the area and we’re collecting our share of that. International demand for dairy products is growing, and dairy has the potential to find new revenues from clever new science and fresh ideas,” says managing director John Penno. “We plan to differentiate Synlait by maintaining total control over a specialist milk production base, and over processing, marketing, and distribution – to guarantee customers the product profile they want as well as absolute food safety, security, and traceability. “We’re also flexible. Our new specialist manufacturing plant can produce a vast array of milk powder specifications to meet the individual needs of customers, but can also do small runs of specialist products for specific purposes. By 2010 we plan to have built Synlait into a major supplier of high-value, high technology milk components to food producers worldwide,” he says. A world-class objective needs a world-class plan and support structure. Penno tells how the original Synlait team transformed its vision to reality. It’s all about control The Dingle/Maclean/Penno trio draws from a pool of solid farming experience, lateral thinking skills, and heavyweight academic qualifications to back up their vision. Dingle and Maclean were interested in growth from the day they started dairying. Dingle focused on his farm management skills while Maclean pursued her biotechnical interests with livestock and feed, including a Nuffield Scholarship in 2000. Penno, a scientist, built up a track record in the successful practical application of science on farms while working for Dexcel, the dairy industry’s research centre. In April 2000 the three met, compared ideas, and split from Fonterra to start up Synlait. They wanted, Penno says, “greater returns on our capital and efforts and increasing the value of the milk we produce”. Their vision? To create a ‘cow-to-customer’ company and capitalise on their concept of the future shape of dairying. Controlling feedstock going into end products was step one of the plan, and the reason for establishing Synlait Farms in 2001. Today the company owns 16 farms totalling 5000 hectares carrying 15,000 cows plus replacements, supported by progressive and tightly defined and controlled farming practices. “Our competitive advantage with Synlait Farms is we can breed and manage our herds to produce the milk profile and characteristics sought by individual customers to add value to their products,” Penno says. Synlait Farms keep an eye open for land to cement its supply chain, but also plans to expand its carefully selected contracted supplier network. Payout to Synlait’s contractors is based on lactose as well as the fat and protein content of milk. While growing Synlait Farms, the team worked to get the customer end of the business in place. Discussions with food companies around the world started three years ago. About 80 percent of the product is destined for Asia, while the Middle East and South America are other key markets. Synlait aims for not only the full and skim milk powder market sgments, but also for the lucrative functional food and nutraceuticals markets. The latter forms the basis for infant formula, hospital foods, energy drinks and health tonics. It includes lactoferrin, an antioxidant used in cancer treatments; colostrum, an immunity booster; and conjugated linoleic acid, thought to be beneficial in lowering cancer risk and triggering weight loss. Delivering the goods Synlait plant manager John Roberts says the Dunsandel processing plant is key to banking the investment in Synlait so far and unlocking future value. It can process up to 1.6 million litres of milk a day and is expected to produce about 30,000 tonnes of milk powder and 5000 tonnes of anhydrous milk fat (products from cream) a year. Synlait awarded GEA Process Engineering NZ the contract to build the plant in May 2007. The company is part of the GEA International Technology Group. GEA supplies more than half the world’s milk powder dryers and has 33 GEA Niro plants operating in New Zealand. GEA business development manager Barry Cole says the company had only 14 months to complete design, construction, and commissioning of the plant. “The key to meeting the project deadlines was detailed planning of the job to ensure the correct sequencing and prioritising of tasks. “The tight timeline required that some of the key phases of the project had to overlap. For example, the fabrication of plant started before detailed design was completed, and plant installation started before the building work was completed,” he says. In addition, Synlait decided partway through the design and planning phase to increase the milk processing capacity of the plant by one third. Silvester Clark Consulting Engineers from Palmerston North designed the building and Ebert Construction from Wellington built it. The building is clad in concrete panel to contain noise within the building envelope and limit noise impacts on neighbouring properties. Companies within the GEA Group designed the complete processing plant, including the milk unloading and handling, evaporator, dryer, powder handling, and powder packing facilities. “The plant technology is European, but most of the equipment was built locally, which was important to us,” Roberts says. NDA Engineering of Hamilton, Mercer Stainless of Christchurch and Farra Stainless of Dunedin did the required precision fabrication of the large stainless steel plant components. NDA Engineering built the 64-tonne stainless steel evaporator. At 21 metres high, Roberts says, it is the biggest single piece of equipment in the factory and one of the biggest dairy evaporator vessels ever made in the world; containing 32 kilometres of stainless steel tubing inside it. A 20-megawatt coal-fired steam boiler powers the processing plant. RCR Energy Systems from Hawke’s Bay designed and built the boiler island, incorporating all its elements from coal truck reception and storage right through to the 50 metre-high chimney stack. The boiler plant is a Towerpak model designed by RCR in New Zealand under license from The Babcock & Wilcox Company (USA). It can deliver 30tph steam at 250 degrees Celsius and 40 bar pressure. RCR constructed the boiler parts at its boiler works at Dannevirke and in Thailand. The main furnace with steam drums and generating tube bank were shipped from Thailand as one large assembly to the port of Timaru port and from there road-hauled to Dunsandel. RCR energy marketing manager Philip Gedye says this size of boiler plant is among the largest that RCR has delivered to site as an assembled module. It enabled a very quick erection for the boiler plant, thereby reducing delay risks in the autumn and winter months. He says when operating at full output the boiler plant can burn through over 100 tonnes of coal per day. The coal will come from the Giles Creek mine on the West Coast. “To maximise thermal efficiency, the plant includes an exhaust economiser that captures a lot of residual heat that would otherwise be lost up the chimney. State-of-the-art exhaust cleaning bag filters ensure that emitted soot particulate levels are among the lowest anywhere in New Zealand,” he says. Albany-based Global Transport NZ road-hauled the major components from their points of origin or from ports to Dunsandel. GEA designed the plant to be highly automated with sophisticated instrumentation and PLC control systems. The system’s electrical design is the work of Wellington-based Intellex Limited. Onehunga-based Newpower Electrical performed the electrical wiring, and Auckland-based Macro Automation wrote the automation software. Project managers Babbage Consultants oversaw the project from conceptualisation, through the tendering process, to the final commissioning of the plant. The project was funded via a loan from Japanese trading giant Mitsui, cash from the sale of Fonterra shares, and loans, including from ANZ Bank. Comments Cole: “Thanks to good working relationships among a big team of contractors all pulling in the same direction, the plant opened right on time. We’re proud of what we achieved. “In most other countries in the world a project of this size wouldn’t be completed in under two years.” The road forward Roberts explains the processing protocol. Tankers unload the milk into storage silos. The composition of the milk is then standardised to remove seasonal variation in milk composition. Excess cream from the plant is processed into anhydrous milk fat. Standardised whole or skim milk is then pasteurised and concentrated to more than 50 percent total solids using a multiple effect falling film evaporator. Both mechanical vapour recompression and thermal vapour recompression are used to boost the efficiency of the evaporator and reduce energy requirements. The water extracted from the milk in the evaporator is recovered and reused by the plant. The hot milk concentrate is further heated, then atomised into a fine mist at the top of the dryer using nozzles under high pressure. Waste heat from the evaporator plant is used to preheat the air used for drying the milk concentrate. The atomised milk is dried quickly and gently in three stages within the dryer using hot air. A GEA Niro SANICIP washable bag filter is used to limit the loss of milk powder in the exhaust air from the dryer. The resulting milk powder has a moisture content of three to four percent. The milk powder is then conveyed into storage bins using gentle dense phase conveying to ensure the powder is not damaged. There, it is flushed with inert gases to remove oxygen and packed into 25kg bags. The bags are then stacked onto pallets using a robot palletiser, ready for transport to the market. All process plant is cleaned daily from a centralised system. Cleaning chemicals and rinse water are recovered and reused. “The plant’s built-in effluent treatment system treats wash water to the standard where it can be spread on pasture,” says Roberts. “We’re aiming to spread wash water, dairy proteins, sugars, and fats discharges on Synlait Farm land so we can get some value from the nutrients and boost production. It offsets fertiliser nutrients to some extent.” In addition, some of the water that will be used to irrigate the adjoining land, will be used first for cooling duties in the plant. With Synlait Milk operational the team can proceed to build the Synlait brand with the skills pool the 50-strong Synlait Milk and 110-strong Synlait Farms teams bring to the table. But the company plans to be ‘nimble adopters of technology’ rather than entering the high-risk game of research and development: “We’re a natural partner for commercialising new technology,” says Penno. Jenny Baker is an Auckland-based freelance writer. For more information visit

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