A new range of baby nutritional powders will be manufactured by Fonterra Australia and Bellamy’s as part of a five-year agreement.
Fonterra Oceania managing director Judith Swales said the partnership would affirm the company's strength in nutritionals.
“Leveraging our Fonterra Research and Development Centre in Palmerston North, we will bring innovation to our Darnum plant and the nutritionals market,” she said.
Bellamy’s is well recognised in the organic ingredient supply chain and achieved revenue growth of 156 per cent in 2014-15.
Formula comprises 88 per cent of Bellamy’s sales and the company is the only certified Australian producer of infant formula.
Last month there were widely reported shortages of Bellamy’s Organic Steps 1, 2 and 3, and angry parents blamed the company for its decision to begin exporting to Asia.
Bellamy's will open offices in Singapore, Shanghai and Hong Kong following huge demand in the region, and is reportedly relocating staff from its Tasmanian head office.
Demand for Australian-made formulas in Asia has skyrocketed since 2008 when local milk and infant formulas were contaminated with melamine.
The proposed multi-million dollar strategic agreement with Fonterra will help support the growth of Bellamy’s Organic in Australia and abroad, according to Swales.
“We're also nearing the finalisation of the Darnum joint venture with Beingmate Baby and Child Food Company following the recent formal approval by Beingmate’s Board and shareholders,” she said.
Swales said the co-operative had a clear plan to return its Australian business to strong and sustainable profitability.
Fonterra and Bellamy’s will finalise the proposed arrangements this month, with the agreement commencing in 2016.
