THE new owner of a South Australian processing plant has increased daily milk intake by up to half a million litres.
United Dairy Power managing director Tony Esposito said an additional 400,000-500,000 litres of milk a day was flowing into the Jervois processing plant, thanks to milk swaps with Victorian processors.
The dairy industry's worst kept secret was confirmed last week when food and beverage company Lion, formerly National Foods, announced it had sold its Murray Bridge and Jervois plants to Victorian-based UDP.
The sites were identified for sale after the multinational company's review of its cheese manufacturing sites.
"The plan is to expand production at both sites," Mr Esposito said this week.
"Both sites are doing approximately 130 million litres a year. We expect to get it up to the 300 million litre mark over the next 12 months.
"At the moment there is no end number in sight (for suppliers).
"Outside of what's required for the drinking milk market there is 400 million litres floating around."
UDP acquired the mozzarella cheese brand Caboolture in the deal and Mr Esposito said he wanted to expand into other products.
The processor will contract pack some Lion products at the sites, including Le Rice and Pura sour cream.
Mr Esposito said 90 staff were employed at the South Australian sites and more shifts were being added to the roster. UDP opened this season at $5.30/kg of milk solids.
Dairy Farmers Milk Co-operative has supplied milk to Lion for the two plants and its Salisbury drinking milk site and is contracted until the end of next June.
DFMC chairman Ian Zandstra could not shed much light on milk supply contract arrangements beyond then, other than to say DFMC would ensure farmers' milk was "utilised by the Jervois and Murray Bridge factories".
Lion's cheese-making review also indicated plants at Simpson and Campbellfield would be closed in the next three years, while the company would invest $132 million more into its specialty cheese manufacturing site at Burnie in Tasmania.