Murray Goulburn (MG) has edged out Bega Cheese to win a $130 million five-year contract to supply private label cheese to Coles.
Bega currently holds the Coles contract, but from January next year, MG will supply Coles-brand cheddar-style cheese including tasty, colby, mild and cheese in blocks, shreds and slices.
The move builds on a ten-year fresh milk partnership forged between MG and Coles in 2014.
MG also says it is currently investing up to $145m to significantly increase 'ready-to-serve' cheese capacity and capabilities at its new consumer cheese plant in Cobram.
MG managing director, Gary Helou said the company was “delighted to extend our existing relationship with Coles and its customers”.
Bega Cheese said that it plans to fill the revenue hole with a move into higher value-added products such as infant formula and nutritionals. Bega and Blackmores jointly launched a new infant formula range last month.