Fonterra - eyeing growth in sports and nutrition products.

Fonterra - eyeing growth in sports and nutrition products.

New Zealand dairy giant Fonterra has joined forces with two US dairy concerns to become an equal shareholder in Oregon-based whey protein concentrate and lactose manufacturer Columbia River Technologies.

Fonterra has entered a joint venture with US dairy co-operative Tillamook County Creamery Association (TCCA) and dairy producer Threemile Canyon Farms on the deal.

Financial details have not been revealed.

Columbia River Technologies, which was originally founded in 2013 as a joint venture between TCCA and Threemile Canyon Farms, has been producing whey protein products for the past five years at a facility in Boardman, Oregon, adjacent to TCCA's cheese making plant.

Since 2013, Fonterra has been the exclusive sales agency for these products.

TCCA has held milk supply agreements with Threemile for the last 16 years. The two organisations established the joint venture to maximise efficiencies at TCCA's cheese-making plant and increase value from the natural whey and lactose by-products of the cheese-making process.

In addition to being an early customer of the whey protein products, Fonterra has shared its dairy expertise with the joint venture since its start-up, through onsite technical support and training.

Joe Coote, regional director for Fonterra's ingredients business in the Americas, said joining the joint venture as an equal shareholder is a natural progression of its long-term relationship with TCCA and Threemile Canyon Farms. 

It enables Fonterra to meet growing demand for ingredients such as whey protein from places outside New Zealand.

"The agreement reflects Fonterra's move to develop a sustainable US-sourcing network, providing a reliable and efficient chain of supply, and complementing New Zealand-sourced ingredients for our sports and infant nutrition customers," he said.

TCCA president and CEO Patrick Criteser said the joint venture aligns with the company's strategy to make responsible use of the by-products of its primary cheese-making business and continue to create value for its farmer-owners.

"We're pleased to further strengthen our existing relationship with Fonterra, an organisation that understands the cooperative mindset and brings significant expertise in the area of whey products," he said.