The Report Of A Factory Visit To

THE REPORT OF A FACTORY VISIT TO FONTERRA BRANDS, SRI LANKA Sachith S. Fernando, Department of Botany, University of Kelaniya, Sri Lanka.

Introduction

In 2001, New Zealand milk Lanka (Pvt) Ltd changed the name as Fonterra Brands. Fonterra is New Zealand’s largest multinational company with revenue exceeding NZD $17 Billion. As a cooperative Fonterra is owned by over 11,000 farmers, it is also the 6th largest dairy company in the world. Fonterra was established in October 2001 through a merger of the two largest New Zealand dairy cooperatives and the New Zealand Dairy Board. The purpose of the merger was to create a single company to manage the supply chain for a significant proportion of the New Zealand dairy industry. The company has an annual turnover of around US$8 billion. Its core business consists of exporting dairy products under the NZMP brand (95% of its New Zealand production is exported). It also operates a fastmoving consumer goods business for dairy products, Fonterra Brands. There are around 30000 farmers in New Zealand who supply milk to Fonterra. Fonterra has a number of subsidiaries and joint-venture companies operating in markets around the world. In 2005 the company purchased a large factory in Dennington, Victoria, Australia from Nestlé, after they moved out of the collection of milk from farmers and the manufacture of powdered milk in Australia. Also in 2005 the company made moves towards purchasing Australian companies Dairy Farmers and National Foods. It also converted its 50 per cent stake in Victorian dairy producer Bonlac to full ownership. At this time $1 billion of Fonterra's revenue was from Australian sales, which was 14 % of the dairy products it sells around the world. In November 2007 after a lengthy capital review the company's board recommended to farmers that its assets, liabilities and operations be split from the co-operative and listed on the New Zealand Stock Exchange. Under the plan, which had been rumoured for months, the co-operative would retain two-thirds of the company, 15% would be given to farmers (which they could sell or retain), and 20% traded freely. Doug Woolerton, a New Zealand First MP, branded the plan "a disaster for farmers and for our economy as a whole", but other commentators said it would breathe life into the sector and the New Zealand economy as a whole. The announcement started a two-year review. If the board's plans are adopted, Fonterra is expected to be New Zealand's largest listed company. Fonterra have recently suggested that they will move their US headquarters from Harrisburg, Pennsylvania to Chicago, Illinois adjacent to the Chicago O'Hare International Airport for close proximity to a wide range of international flights, proximity to public transportation, their dairy suppliers and clients (Kraft Foods Inc. and General Mills Inc.) in the Midwest. In Sri Lanka, the factory is located at Biyagama and all the processes are carried out in that particular factory.

Fonterra is keen in keeping the quality of milk at the best level. The milk products of Fonterra are accredited with; ISO 9001: 2001 HACAAP SQF ISO 22000: 2005

What Fonterra does in Sri Lanka? Fonterra Brands Lanka (Pvt) Ltd. is the major dairy product manufacturer and marketer in Sri Lanka. In the past it only manufactured milk powder, but today it produces a range of dairy products to the local market, such as yoghurt, liquid milk. Therefore, it has two plants separately as liquid and powder plants

Products of Fonterra for local market Anchor full cream milk powder Raththi full cream milk powder Anchor 1+ and Anchor 3+ Anlene Anmum Anchor non fat Anchor butter and cheese Newdale yoghurt Raththi yoghurt Anchor yoghurt Anlene yoghurt Newdale fresh milk UHT milk

The factory As mentioned earlier, the factory is composed of two plants 1. powder plant 2. liquid plant

Powder plant In the powder plant what the Fonterra does is packing the milk powder brought from New Zealand in to consumer packs. The milk powder arrives in 25 kg bulk packets in sealed containers. Each container has 1008 bags (25 kg) and there are 56 bags per plate. The bulk packets have different colors because of the different milk powders.

A 25 kg milk powder bulk packet Mainly two types of packaging are done in the powder plant. 1. Unblended method 2. Dry blended method 1. Unblended method Here the imported milk powder is directly packed without the addition of any additives.

(i) Anchor full cream milk powder

(ii) Raththi full cream milk powder

(iii) Anchor non fat 2. Dry blended method At the powder plant, many nutrients and minerals are added to the imported milk powder to produce a range of different products. (i) Anchor 1+ and Anchor 3+ - for growing children, flavors are added to increase the appetite

(ii) Anlene - contains high amount of calcium, good against osteoporosis

(iii) Anmum – for pregnant women, contains folic acid

Milk powder processing at Fonterra There are three major regions of the powder plant • • •

hygienic area semi critical hygienic area critical hygienic area

Milk powder packing process 1. Unloading and storage of milk powder Milk powder bulk packs (25 kg) imported from New Zealand is unloaded from the Lorries at the factory and stored in the yard. According to the need they are taken in order to pack and release to the market. Each and every pack has; A factory number - registration number A unit number - pallet number A cypher - date of packing 2. Depalatization Here the milk powder taken from each palate is checked for microbiological, chemical, sensory and physical properties. 3. Debagging This is done in debagging room which is a semi critical hygienic area. Here the outer craft paper bag is removed manually without touching the inner content 4. Tipping Tipping means the opening of polythene bag and pouring the milk powder in to the hopper machine. This is done in the tipping room which is also a critical hygienic area. 5. Filling Filling is done in the filling room using Oggur filling system which is a critical hygienic area. The milk powder is filled into the aluminum foil using the filling machine. While filling, nitrogen gas is also added into the bags to retard oxidation process. The packets are sealed horizontally and vertically. The average mass of a packet is 400g and the packets having different masses are automatically rejected when they are conveyed to the boxing room. 6. Boxing The sealed packets are then packed into cardboard boxes to be dispatched to the market. This is done in a semi-automated manner. The small boxes are packed in larger boxes (36 packets in each) 7. Storage The large boxes are stored in the stores and loaded to the Lorries according to the market requirement.

Details mentioned in the boxes are as shown below:

Liquid plant The milk collected at the collecting centers are checked for chemical, physical and microbiological properties to assure the quality and if ok milk is loaded to the bowsers and brought to the factory. About 2000 farmers around Sri Lanka supply milk daily to Fonterra.

At the factory, the milk samples are rechecked for bacterial levels and water content. The good quality milk is pumped into large silos and stored below 8 oC.

All the equipment and machines are washed and cleaned regularly. The cleaning process is called Cleaning in Place (CIP) Washed with NaOH

Washed with water

Washed with HNO3

Rewashed with water

Finally washed with hot water

Raw milk processing in the factory Raw milk

Separating fat – separator machine

Mixing ingredients (dissolved gelatin, chocolate, vanilla)

Homogenization

Filtration Pasteurization (85 oC, 3 min)

Deaeration Cold storage (4 oC)

Processing for various products

Filling (into packets, bottles ect.) Cold storage (4 oC)

Delivery

Cultured products Yoghurt production There are two types of yoghurts produced by Fonterra. § Set yoghurt § Stirred yoghurt Set yoghurt production process Heat treated milk + skim milk

Mixing ingredients

Homogenization Pasteurization (85 oC, 3min) Cool (43 oC)

Inoculation of starter culture

Filling into cups

Packing in boxes Incubation (43 oC, 12hrs) Cold storage (4-7 oC) Stirred yoghurt production Similar to set yoghurt production, but specific bacteria are added to starter culture and incubated at 42 oC

UHT products UHT stands for “ultra heat treated”. Here a high temperature is used for a short period of time. It provides a long shelf life. UHT treatment retains the flavor and nutritional quality of milk. The process Mixing and formulation (flavors added)

Pasteurization

Aging Sterilization (1400C, 5s)

Filling into packets

Packets sealed and stored

Anchor butter and cheese The fonterra imports Anchor butter and cheese from New Zealand and supply to the local market.

Ice cream Fonterra does not produce ice cream in large scale. They produce ice cream according to the demand. E.g. fonterra supplies ice cream for MacDonald’s

Quality control of milk The Fonterra is very interested in keeping the quality of their products at the best level. In milk quality controlling, approved tests are used to ensure that the products are in accepted standards. Here the physical, chemical and microbiological properties are mainly concerned. The Fonterra does the quality controlling at all steps of the chain At the farm This is done by using proper veterinary practices and by proper handling methods by farmers. At collecting centers Here milk is tested for water content, fat content and other chemical and microbiological properties. Within the factory Before accepting the milk for further processing, each bulk of milk from different collecting centers is tested specially at the liquid plant. The powder plant also conducts the quality control tests for milk powder. So the two plants have separate labs to carry out these tests. Also both the plants maintain three types of hygienic areas to ensure maximum protection from contaminants; 1. hygienic area 2. semi critical hygienic area 3. critical hygienic area

Tests in powder plant Sensory test Taste, color, odor and texture of milk powder are tested by a professionally qualified sensory panel. Randomly taken 200 samples are tested from 125 -150 metric tons of milk powder handled per day. Physical tests 1. Vacuum tester/leak tester Here the sealed milk powder packet is dipped in water and the pressure of the vacuum chamber increased. If there is any leak, air bubbles will come out. Five samples are taken randomly from each line of the conveyor for testing. 2. Moisture tests Done to maintain the moisture level at 2.5% (SLS standard is 4%)

3. Oxygen level test Oxygen level is kept at standard level. So prevent degradation. Chemical tests Ion, calcium, fat content and SNF tests are done 1. Ion test This test is mainly done for high ion containing products; Anmum, Anchor1+ and Anchor3+. Milk powder is burnt into ash in high temperature in a muffle burner. Then a solution is prepared and spectrometrically analyzed. 2. Ca test This test is done specially for the high calcium product Anlene. Here a titration is done. Microbiological tests Coliform test, yeast and mould count and total plate count are done.

Tests in liquid plant Sensory evaluation Sensory evaluation is done by a well trained sensory panel. Physical tests 1. Gerber butterfat test The fat content of milk and cream is the most important single factor in determining the price to be paid for milk supplied by farmers in many countries. Also, in order to calculate the correct amount of feed ration for high yielding dairy cows, it is important to know the butterfat percentage as well as well as the yield of the milk produced. Further more the butterfat percentage in the milk of individual animals must be known in many breeding programs. Butterfat tests are also done on milk and milk products in order to make accurate adjustments of the butterfat percentage in standardized milk and milk products.

Equipment used in Gerber Butterfat test Apparatus for DF test: • • • • • •

Gerber butyrameters, 0-6% or 0-8% BF Rubber stoppers for butyrometers 10.94 or 11 ml pipettes for milk 10 mls pippetes or dispensers for Gerber Acid 1 mls pippetes or dispensers for Amyl alcohol stands for butyrometers

Gerber water bath Reagents: • •

Gerber sulphuric acid,(1.82 g/cc) Amyl alcohol

Fresh milk at approximately 20 ºC should be mixed well. Samples kept cool for some days should be warmed to 40 ºC, mixed gently and cooled to 20 ºC before the testing. Procedure Add 10 ml sulphuric acid to the butyrometer followed by 10.94 or 11 ml of well mixed milk. Avoid wetting of the neck of the butyrometer. Next add 1 ml of Amyl alcohol, insert stopper and shake the butyrometer carefully until the curd dissolves and no white particles can be seen. Place the butyrometer in the water bath at 65 ºC and keep it there until a set is ready for centrifuging. The butyrometer must be placed in the centrifuge with the stem (scale) pointing towards the centre of the centrifuge. Spin for 5 min. at ll00 rpm. Remove the butyrometers from the centrifuge. Put the butyrometers in a water bath maintained at 65 ºC for 3 min. before taking the reading. The fat column should be read from the lowest point of the meniscus of the interface of the acid-fat to the 0-mark of the scale and read the butterfat percentage.

The butyrometers should be emptied into a special container for the very corrosive liquid of acid-milk, and the butyrometers should be washed in warm water and dried before the next use. The fat layer is separated and analyzed. The value should be 3.5% 2. Moisture test Moisture level is measured using moisture analyzer after the solid milk kept in oven at 115 oC 3. Specific gravity test Addition of water to milk can be a big problem where we have unfaithful farm workers, milk transporters and greedy milk hawkers. A few farmers may also fall victim of this illegal practice. Any buyer of milk should therefore assure himself/herself that the milk he/she purchases is wholesome and has not been adulterated. Milk has a specific gravity. When its adultered with water or other materials are added or both misdeeds are committed, the density of milk changes from its normal value to abnormal. The lactometer test is designed to detect the change in density of such adulterated milk. Carried out together with the Gerber butterfat test, it enables the milk processor to calculate the milk total solids (% TS) and solids not fat (SNF). In normal milk SNF should not be below 8.5% Procedure Mix the milk sample gently and pour it gently into a measuring cylinder (300-500 ml). Let the Lactometer sink slowly into the milk. Read and record the last Lactometer degree (ºL) just above the surface of the milk. If the temperature of the milk is different from the calibration temperature (Calibration temperature may be=20 oC) of the lactometer, calculate the temperature correction. For each ºC above the calibration temperature add 0.2 ºL; for each ºC below calibration temperature subtract 0.2 ºL from the recorded lactometer reading.

Equipment used for determination of milk density

Chemical tests 1. Acidity test Bacteria that normally develop in raw milk produce more or less of lactic acid. In the acidity test the acid is neutralized with 0.1 N Sodium Hydroxide and the amount of alkaline is measured. From this, the percentage of lactic acid can be calculated. Fresh milk contains in this test also "natural acidity" which is due to the natural ability to resist pH changes .The natural acidity of milk is 0.16 - 0.18%. Figures higher than this signify developed acidity due to the action of bacteria on milk sugar. Apparatus • • • • • • •

A porcelain dish or small conical flask 10 ml pipette, graduated 1 ml pipette A Burette, 0.1 ml graduations A glass rod for stirring the milk in the dish A Phenolphthalein indicator solution, 0.5%in 50% Alcohol N Sodium hydroxide solution.

Apparatus used for acidity test

Procedure 9 ml of the milk measured into the porcelain dish/conical flask, 1 ml Phenopthalein is added and then slowly from the burret, 0.1 N Sodium hydroxide under continuous mixing, until a faint pink colour appears. The number of milliliters of Sodium hydroxide solution divided by 10 expresses the percentage of lactic acid. Acidity is kept around 0.13-0.15

2. Alcohol stability test Stability of milk is tested at different alcohol levels and if the milk is clotted in 70% alcohol or below it is rejected. The test is quick and simple. It is besed on instability of the proteins when the levels of acid and/or rennet are increased and acted upon by the alcohol. Also increased levels of albumen (colostrum milk) and salt concentrates (mastitis) results in a positive test. Procedure The test is done by mixing equal amounts of milk and 68% of ethanol solution in a small bottle or test tube. (68 % Ethanol solution is prepared from 68 ml 96 % (absolute) alcohol and 28 mls distilled water). If the tested milk is of good quality, there will be no coagulation, clotting or precipitation, but it is necessary to look for small lumps. The first clotting due to acid development can first be seen at 0.21-0.23% Lactic acid. For routine testing 2 mls milk is mixed with 2 mls 68% alcohol.

Equipment used in alcohol test

3. Resazurin test The Reassuring test is based on the color impairment to milk by the addition of a dye such as Resazurin. The removal of the oxygen from milk and the formation of reducing substances during bacterial metabolism cause the color loss. If the number of bacteria is high, the color loss is quick. The procedure for making the resazurin test is as follows: Prepare resazurin solution by dissolving one resazurin tablet (dye content/ tablet, approximately 11 mg) in 200 ml of hot distilled water. Place one ml of dye solution in a sterile test tube, and then add 10 ml of sample. Stopper the tube, place in the incubator and, when the temperature reaches 36 oC, invert to mix the milk and dye. Incubate at 36 oC. Tubes are examined and classified at the end of an hour in the "one-hour test" or at the end of three successive hourly intervals in the "triplereading test."

The following relationships of color and quality are generally accepted: Color of Sample: Quality of Milk 1. Blue (no color change): Excellent 2, Blue to deep mauve: Good 3. Deep mauve to deep pink: Fair 4. Deep pink to whitish pink: Poor 5. White: Bad

Apparatus used in 10 min. Resazurin Test

4. Soluble solids Soluble solid content is determined using a refractometer Microbiological tests 1. Total plate count By this technique, the total number of bacteria present in milk sample can be determined 2. Yeast and mold count 3. Coliform test This test is done to check the presence of coliforms such as E. coli which are indicators of fecal contamination. Presumptive test and confirmed test are done here and the completed test is done in New Zealand. 4. Plaque test This test detects the presence of bacteriophages.

Environmental control The factory premise of Fonterra is covered by nets to prevent the entering of insects such as flies. Also they employ many tests to assess the cleanliness of the environment. The air exposure test is done by keeping the lid of an Agar plate for 18 minutes at the factory environment after the incubation colony forming units per square meter are counted. The test is carried out weekly. Weekly swabs are taken from machinery and floor and they are also plated to be tested for the presence microorganisms. After sweeping the floor the collected dust samples are sent weekly to New Zealand for the testing of Salmonella. Three defense lines with bail stations are maintained specially against rodents and flying insects. There is a positive pressure maintained in the processing rooms. That means air flows from inside to outside hence preventing the entrance of unwanted organisms. The flies are caught using purple color bulbs. The air is filtered using an air handling system which contains primary and secondary filters (microfilters). Only the filtered air is allowed to enter the plants. The floor of the factory is washed with approved chemicals in critical hygienic area. Chlorine water is used in non critical hygienic areas. Chorine foot baths are there to wash feet before entering the processing rooms. Before entering critical hygienic areas the feet are sprayed with isopropyl alcohol (70%) The limited entry of outsiders to the factory prevents the contamination from outside sources.

References http://www.fonterra.com http://www.foodsci.uoguelph.ca