Portugal-based retailer Jeronimo Martins has said its new EUR40m (US$45m) milk processing plant in the country is part of a strategic move to have “direct access to sources of supply” for a range of food products.

A spokesperson for Jeronimo Martins, which owns Pingo Doce supermarkets and Recheio cash-and-carry outlets, told just-food the new factory, which is expected to open in the first half of 2017, will meet the group’s entire needs to supply its domestic stores.

Jeronimo Martins’ overall strategy is to ensure the group’s internal needs are met “at a competitive cost, with efficiency and under quality conditions, supported by the right research and development strategy”, the spokesperson said.

Since June 2015, Jeronimo Martins has been relying on the Serraleite milk processing factory in Portalegre for its dairy needs. The retailer acquired the Serraleite factory last year when its purchase of the Serraliete cooperative was approved by Portugal’s competition authority.

That led to a 15% increase in UHT milk production and an increase of around 2,000% in cream production, the spokesperson said. “Jeronimo Martins aims to maintain production in this factory until the new factory opens, which will enable us to increase the production of milk and its derivatives under excellent conditions.”

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By GlobalData