Adding value and efficiency through secondary processing

Adding value and efficiency through secondary processing

Fonterra’s secondary processing sites at Tullamarine and Campbellfield add value to our business in more ways than one. They give us a competitive edge to get products to market, innovate and respond to consumer needs with flexibility and control. Importantly, they strengthen our integrated supply chain – giving us full control of it – and play a key role in the entire network of our manufacturing sites in Victoria and Tasmania. 

It's now been 18 months since we commissioned our second site at Tullamarine, expanding our secondary processing capability and supporting value growth for our business. Here’s some background on how these sites operate and the competitive advantages it brings to our business.  

We have four secondary processing sites in Melbourne
On the outskirts of Melbourne, we have two sites at Tullamarine (known as Tulla 1 and Tulla 2) and another close by in Campbellfield. Tulla and Campbellfield produce our shredded and grated products, mostly Perfect Italiano blends and grated parmesan, alongside Foodservice SKUs. Campbellfield is where we pack blocks and slices.  

Our fourth secondary processing site is Bayswater in Melbourne’s outer east, where our snacking products are made.

Cut, shred, grate, slice and pack
If you ever get the chance to visit a dairy manufacturing site, the secondary ones are full of activity. It’s where we take bulk products and turn them into formats you’ll be familiar with at the supermarket. Think cheese slices, grated blends and pack sizes that range from 250 grams to 1-kilogram blocks. These types of sites are also heavily automated and advanced in technology, meaning we can get large volumes of products to market as efficiently as possible.  

Our secondary sites at Tullamarine enable end-to-end control for getting products to market – from the milk collected on farm in Victoria and Tasmania, which is made into cheese, butter and co-products at our primary processing sites, then sent to Tulla to become the final finished product packed for the supermarket shelves.  

Members of Fonterra Oceania’s Leadership Team watching the shredded cheese on the manufacturing line at Tullamarine.

Processing capacity
Across Tullamarine and Campbellfield, their processing capacity is around 48,000 metric tonnes (MT) each year. Tullamarine’s annual volume is 31,000 MT (with Tulla 1 processing 70 per cent, and Tulla 2 processing 30 per cent of volume). Campbellfield picks up the remaining 17,000 MT for blocks and slices.  

We’ve seen these volumes grow over the last 12 months as we’ve supported new product development for our Foodservice customers, in addition to new contracts with new and existing customers.

Efficiency and flexibility
Having both primary and secondary sites generates greater efficiency for us. It means we can respond to the market and changing consumer behaviour with greater flexibility – like creating different block sizes and formats (as we recently did with a  Bega block ) when consumer trends and customer needs change.

With 18 months now under our belt since we commissioned Tulla 2, it’s been great to see secondary processing strengthen control over our supply chain and complement our network of sites at Cobden, Stanhope, Darnum, Wynyard and Spreyton.

If you have questions about our sites and supply chain, brands or products, please contact your Area Manager.