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Dairy firms plan joint processing venture in Winnipeg

Dairy co-op Gay Lea to extend membership to Manitoba farmers


Manitoba dairy producers are expected to get a new outlet for their raw milk from a new joint venture to process butter and dairy ingredients in Winnipeg.

Mississauga-based dairy co-operative Gay Lea Foods and ingredient processor Vitalus Nutrition of Abbotsford, B.C. on Monday announced a joint venture to be based at an unnamed “existing food manufacturing facility” in Winnipeg.

The joint venture, the companies said, calls for “significant upgrades to modernize” the plant, which in turn will call for “increased drying capacity in Western Canada, and new butter production to respond to market demands.”

The companies didn’t say Monday when they expect to have their operation up and running. A company representative wouldn’t say who now occupies the plant, which is in the Fort Garry area in the city’s southwest. Financial terms of the joint venture also weren’t disclosed.

The new venture marks a westward expansion for Gay Lea, an Ontario producer co-op with production plants and distribution sites in both Ontario and Quebec.

Dairy Farmers of Manitoba, the organization in charge of dairy supply management in the province, will arrange the raw milk for the new plant, the companies said.

Manitoba dairy farmers, they added, will also now get “the opportunity to join Gay Lea Foods as member owners.” The co-op in January this year also expanded its membership to include Ontario dairy goat producers.

DFM chair David Wiens said in a release Monday that the new venture “will help ensure the continued sustainability of the Canadian dairy industry today and for future generations.”

Gay Lea CEO Michael Barrett said the co-op “is excited by the opportunities that the joint venture brings to both the co-operative and Canadian dairy, through increased processing capacity for ingredients and butter while extending our open membership to farmers in Manitoba.”

Vitalus president Philip Vanderpol said the venture will “increase much-needed drying capacity while further developing the dairy ingredients industry, adding growth and new market opportunities for Canadian dairy.”

The B.C. company comes to the table with a proprietary enzymatic process to convert milk byproducts to galacto-oligosacharides — “high-value” carbohydrates used as additives in infant formula and other foods.

Vitalus, whose product lines also include milk protein concentrate (MPC), whey proteins, pasteurized cream and whipping cream, last month picked up a $10 million federal AgriInnovation loan, via the Growing Forward 2 ag policy funding framework, to commercialize a new prebiotic made from milk permeate.

Milk permeate — the lactose byproduct left after milk goes through the filtration process to make MPCs — is otherwise used to help standardize skim milk powder. Prebiotics are non-digestible carbohydrates that act as food for probiotics, the “good” microorganisms that support healthy digestion and help protect the body from harmful bacteria.

Vitalus’ prebiotic can be used in infant formula and other dairy products and beverages, as well as in fruit drinks and fruit preparations, to “enhance their nutritional characteristics,” the federal government said Sept. 9.

The government on Oct. 8 also announced a $3.5 million loan for Vitalus from the Western Innovation (WINN) Initiative, a separate fund to help small- and medium-sized companies move ideas to market. — Network

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