UPDATE 1-Australian milk science lures food makers tapping Asia's changing diet

Wed Nov 6, 2013 1:00am EST
 
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* Australia's Warrnambool wanted for lucrative milk extracts

* High-end nutraceuticals sector key prize amid Asia demand

* Asia-Pacific to have 39 pct of $205 bln global market by 2017

By Jane Wardell

SYDNEY, Nov 6 (Reuters) - Food companies stalking Australia's Warrnambool Cheese and Butter Factory Company Holdings Ltd are being lured by the firm's high-tech milk extracts as much as its basic dairy produce.

The extracts are a core element in health-promoting products from premium infant formula to bone supplements. Known as nutraceuticals, the extracts are poised for big growth as Asia becomes more affluent and diets change.

With the nutraceuticals market in the Asia-Pacific set to be worth $80 billion by 2017, Warrnambool is sitting pretty. It is one of just two producers of the extracts in Australia, the only country in the region with the scale of spare milk capacity required to produce them.

Extracting just 1 kilogram of lactoferrin, a nutraceutical used in premium infant formula, takes up to 100,000 litres of regular milk.

"Critically, most of the countries responsible for the surging demand in Asia can't produce milk themselves," said Michael Harvey, dairy analyst at Rabobank. "They need countries like Australia that have a surplus of milk to export."   Continued...