A story about dairy processing plants, fat balls and blocked sewers

If you head over to the National Farmers’ Federation website, it gives you a run down: there are 8,594 dairy farms in Australia, a national dairy herd of 1.6 million cows, and more than 9 billion litres of whole milk being produced per year with the farm gate value of about $4 billion.

While farmers, dairy food processing factories and exporters see dollar signs, others like Aerofloat’s Ray Anderson, are aware that the process wastewater generated at these factories needs to be treated before being released into the environment.

Anything not used in the primary product that is sold on the shelf, is waste – including all the washdown water and storage tank cleaning water. And this is where food processing managers need to do research on the best solution to minimising and getting rid of waste.

You would think within the modern food processing environment that this would be a relatively easy fix. But Anderson, who is Aerofloat’s managing director, said it’s not that simple as the wastewater quantities and quality from different dairy processing plants can vary significantly. As such, there are different approaches and methods of treating the wastewater that is produced by different industries.

“I wouldn’t call any of these waste streams challenging. I’d call them all treatable as long as you know what you are doing,” he said. “If there is a lot of fat and suspended proteins, as is the case if you’re treating wastewater from a milk bottling plant, you can remove the fats, proteins and lactose but you need to understand how to do that. You need to be able to understand the chemistry. The fats and suspended protein (casein protein) can be removed by physical means, whereas the dissolved protein (whey protein) and lactose are soluble and need to be removed by biological processes. First, you need to be able to add the right chemicals to be able to bring the fats and casein protein together so they can be separated from the clean water. This separation can be done with a technique called dissolved air flotation (DAF).”

If a local sewerage authority has the capacity, they may be prepared to accept the discharge from the process, providing the suspended fats and proteins are removed to low concentrations. If there is no local sewerage authority, then the remaining soluble contaminants need to be removed by a biological process before the water is discharged to land or the river system. There are different types of biological processes available but the use of Moving Bed Bio-film Reactors (MBBR) processes are common. This is a process where the wastewater is aerated in the presence of micro-organisms, which are attached to millions of small pieces of plastic bio-media.

It is also important that the company producing the waste knows the local regulations when it comes to treatment. Every council, state and municipality has different standards and ignorance is no excuse if a company is found in breach of these regulations.

“A company needs to understand the regulatory requirements for the local sewage authority if you have a sewer available,” said Anderson. “If you don’t have a sewer available, you then need to have an understanding of what the regulatory requirements are of the Environmental Protection Authority (EPA) in terms of treating and releasing back into the environment, or onto the land for irrigation purposes.”

The majority of food processing facilities are connected to the sewer; however, trade waste charges can become excessive depending on the volume and quality of the wastewater being discharged. So, this becomes another factor in considering the wastewater treatment processes employed. If a processing factory is in an area where they cannot put these by-products down the sewer, the company needs to be able to treat the wastewater to a high standard that allows them to discharge it into the rivers, or to irrigate the land.

“The industry needs to be able to engage a reputable design and construct contractor who can provide an economic analysis and advise on the most efficient and cost-effective process for treating the wastewater – whether that is DAF-only or DAF and biological, as well as the issues of disposal of the residues from the processes. That involves having a sound understanding of biological process engineering, being able to choose the most cost effective process to treat that wastewater given the availability of land or space and finish up with a water quality suitable to be able to be discharged to sewer, the environment or land,” said Anderson.

Although there are different ways of treating dairy waste, as a general rule, most dairies will require a DAF treatment for removal of any residual fats and proteins, even in cheese and yoghurt manufacturing where most of this suspended material is removed for making the product. If a company does not comply with the stringent discharge standards, they may be charged a penalty.

Aerofloat’s wastewater treatment systems can help with both the solids removal and the soluble contaminant removal of milk processing wastewater. Firstly, the wastewater is chemically treated to coagulate and flocculate (pull together), the solid particles and the chemical treated stream is then transferred to Aerofloat’s proprietory AeroDAF to float and separate the particles – this removes the fats and the suspended protein. The second phase uses a biological process to treat the dissolved lactose or sugar.  Again, Aerofloat typically uses the MBBR biological treatment technique– the AeroMBBR. In some instances, if sufficient land is available a hybrid version of the Activated Sludge / Sequence Batch Reactor (SBR) technology can be more economically employed.

The final consideration is understanding what to do with the by-product once separated.
“You can send the waste left over to a composting plant, or plough it into the land as a carbon supplement,” said Anderson. “Some people use it for making compost material. Wherever possible, food processors should try and use that separated waste and concentrated waste for some form of beneficial reuse.”

“Sometimes the water can be used for irrigating the land and making it more lush for the cows to feed on the grass again,” he said. “Sometimes with the whey component they separate that out into tanks and send it off to pig farmers as pig food.”

So why is it important to treat dairy wastewater by these means? The most common problem is the amount of fat constituent in the wastewater. In the past, small boutique cheese makers have started up and as part of their manufacturing process they would put in grease traps. “These traps act like a gravity separation piece of equipment for the flotation of fats, but they don’t work properly as the flows increase and due to the temperature of the wastewater,” said Anderson. Those small cheese factories grow and put more water down the sewer, and nearly all of them have problems with high levels of fats being discharged to the sewer. The fat going into the system can have major implications on causing the formation of fat balls, which block the sewers and can cause sewer overflows.

“We were advised of an instance recently where a cheese maker had been discharging, on a regular basis, a high level of fat and it caused a blockage in the sewer that flooded one of the neighbour’s factories,” he said. “The discharge of fats into a sewer is a major problem internationally for sewage authorities. It’s not just from dairy waste, it is from other places, such as abattoirs, food processors and large commercial kitchens. Anything that has wastewater containing fats, oil or grease in them can contribute to this problem.

“Over time, the fats accumulate in the sewers, and you might not know it causes an issue until there is a complete blockage. There are some pretty horrific stories of fat balls blocking sewers. Places like London where you have these spherical fat balls a couple of metres in diameter that have blocked the sewerage pipes.”

According to Anderson, it is however, not all bad news, especially if those responsible for the waste take charge in a responsible manner. He even sees some good outcomes. “By installing a wastewater treatment system, companies can significantly reduce their trade waste costs.”

What is important is that dairy food and beverage processors are responsible for the discharge they put into the sewage system or on surrounding land. This is why it is critical that correct equipment is used when disposing of dairy waste.

Shift in rankings of companies listed in Rabobank Global Dairy Top 20

For the second consecutive year, there are no new entrants to the Rabobank’s Dairy Top 20 list, but there’s been a slight shuffle in rankings.

The world’s largest food and beverage company, Switzerland’s Nestlé, reigns supreme on the list, but the gap between number one and number two has narrowed.

French Lactalis swapped places with Danone, moving into second place.

Danone slipped to the third spot, after divesting Stonyfield following the acquisition of WhiteWave, reducing its stake in Yakult, and selling its holdings in the Al Safi Danone joint venture in Saudi Arabia.

READ: Nestlé pledges to use only certified sustainable palm oil within five years

Dairy price recovery in 2017 has positively affected the combined turnover of the top 20 global dairy companies, which was up 7.2 per cent on the year in USD, RaboResearch has shown.

Dairy senior analyst Peter Paul Coppes said the USD five billion threshold was difficult to achieve due to a scarcity of large acquisitions or mergers.

“However, while the names have remained the same, the order shifted in 2017.”

Merger-and-acquisition (M&A) activity in the dairy sector grew in 2017, fuelled – as in other sectors – by the availability of cheap capital.

Cooperatives are still dominating, but they are also challenged. Deals between Danone and WhiteWave, and Saputo and Murray Goulburn, had limited impact on rankings within the Global Dairy Top 20.

While M&A occurs in the dairy sector, dairy acquisitions tend to be limited in size and financial impact.

There is potential for growth within increased collaborations between Chinese and non-Chinese companies. If this happens, China has the potential to create a pipeline of global management talent.

Chinese companies need to address the integration of non-Chinese management as they consider global growth opportunities.

Rabobank sees an increased amount of disruption-based M&A deals, either defensive or opportunistic.

By nature, these deals are often small and involve start-ups, but they are growing in volume.

Beston Food Company in talks with SA milk suppliers ahead of cheese expansion

More than 20 South Australian dairy farm owners have agreed to supply milk to the Beston Global Food Company (BFC) as part of an agreement that will see the company purchase an additional 60 million litres annually.

The deal marks an effort to underpin future cheese production at BFC’s Murray Bridge and Jervois facilities, calling on help from farms reaching Mount Gambier to the Barossa Valley.

To ensure its rapidly growing cheese operations, BFC has said it requires around 90 million litres of milk in the 2018 financial year – a substantial increase from the 20 million litres it sources from its own farms each year.

“We are in talks with other dairies in major South Australian milk production areas and expect to reach the target in the coming weeks,” said Sean Ebert, BFC’s CEO.

“All of the dairies involved have been supplying other national food groups and were looking for alternatives.”

BFC is in the process of installing a state-of-the-art mozzarella plant at its Jervois factory and expects to produce a minimum of 5,000 tonnes per annum when it is commissioned later this year.

In May, BFC subsidiary Beston Pure Foods’ Edwards Crossing was named Best Cheddar Cheese in Australia at the 2017 Dairy Industry Association of Australia awards.

Kefir fermented dairy drinks flourishing

New launches of Kefir, a type of fermented milk drink that originated in the north Caucasus Mountains, are outpacing the launches of other drinking yogurts and fermented beverages, according to research.

While kefir launch numbers are still limited globally, Innova Market Insights data indicate that they grew more than three-fold between 2011 and 2016. This is despite launches in the overall drinking yogurt/fermented beverages sub-category rising by a much more modest +60 per cent.

“As interest in fermented dairy products spread in the West alongside the arrival of the so-called functional foods market in the 1990’s,” reports Lu Ann Williams, Director of Innovation at Innova Market Insights, “Kefir started to move out of its home in the Caucasus via limited availability in specialist health food stores in western markets to a more value-added, mainstream positioning, particularly in the USA.”

The USA pioneered the kefir market in the west and brought value-added options in resealable plastic bottles to the mainstream market. This allowed for more direct competition with other dairy and non-dairy beverages. It accounted for over one-third of global kefir launches in 2016 and beverages featuring kefir accounted for 40 per cent of USA drinking yogurt/fermented beverages introductions overall, compared with just over eight per cent globally. Europe accounted for the bulk of the remainder, led by more traditional markets in Eastern Europe, although launches in Western Europe have grown strongly, but from a very small base.

Kefir is strongly promoted on its healthy properties, particularly with rising interest in fermented foods and beverages overall. All USA and nearly 94 per cent of global kefir launches used some kind of health positioning in 2016. There was initial emphasis on probiotics, particularly focusing on digestive health benefits. Even though regulatory issues have made this type of claim more difficult in some parts of the world, digestive health claims were still used for nearly two-thirds of global launches in 2016.

Nearly half of kefir launches use low fat claims and the sector has also not been slow to exploit rising concerns over sugar intake in the diet. The number of global launches positioned on low sugar/no-added-sugar and sugar free positionings doubled in 2016 to feature in 20 per cent of the total. Organic and lactose free variants are also increasingly common among kefir launches.



Tank cleaning system does the job for dairy processor

A Pennsylvania milk company utilises vertical spray dryers to produce large quantities of milk powder. With sizes of up to 22 feet in diameter and up to 60 feet high, the facility’s spray dryers can produce a total upwards of 4,000kg of milk powder per hour.

During the manufacturing process fluid milk is evaporated to 50 per cent solids and then injected under high pressure into the 200-plus°C environment inside the spray dryer where it flash dries.

The dry milk then drops to the bottom of the unit and is discharged into bulk containers. Vibrators help remove any powder which may adhere to the sides of the cone. However, over time, the milk builds up on the inside of the dryer and must be removed during routine cleaning. In order to maintain high production efficiencies and product quality, close attention is paid to maintaining the cleanliness of the spray dryer interiors.

Until recently, the company utilised traditional spray balls and high pressure water injection to clean the dryers. The routine cleaning cycle usually consisted of two 45 minute wash cycles utilising a 2 per cent sodium hydroxide caustic solution and a 1 per cent nitric acid wash, interspersed with 20 to 30 minute rinses.

A thorough cleaning of the entire unit often required up to 16 separate insertions of the spray ball by cleaning personnel into various openings throughout the dryer. This was a very time consuming and labor- intensive operation to ensure that all the areas were cleaned. Water usage throughout the process was approximately 946 litres per minute.

With a standard cleaning process to measure against, the company’s Manager of Engineering and Maintenance had the opportunity to install and utilize two rotary impingement cleaning machines manufactured by Gamajet Cleaning Systems, Inc. The Gamajet 4 and Gamajet E-Z8 cleaning machines are fluid driven tank cleaners that utilize the cleaning solution for power and provide 360° cleaning with low flow rates and high speed.

The Gamajet 4, because of its greater cleaning power, was inserted inside the large upper chamber and dome of the spray dryer, while the Gamajet 8 is positioned in the smaller sized bustle and cone located at the bottom of the unit. During the new cleaning cycle each Gamajet unit is inserted only once resulting in immediate savings in time and manpower.

With the new units, wash times have been reduced to a 15-30 minute cycle and often only one wash is necessary. Because of the Gamajet’s high powered cleaning force, water usage is now estimated to be about 100 gallons per minute. “We estimate that by using the two Gamajet units, we save about two and a half hours in time and around 28390.59 litres of rinse water per cleanup, the Manager says. “And, we also save on the amount of chemicals we use.”

Jarlsberg launches cheese mini’s

Jarlsberg cheese is now available in a new mini format.

Currently available at Woolworths, Coles and leading independent supermarkets in packs of five minis, each 20g Jarlsberg Mini is a perfectly round, individually wrapped miniature cheese wheel.

Bite-sized and consistent with the brand’s sweet nutty taste Australian’s have come to love, the products are ideal for breakfast on the go, school lunches, work lunches and snacking occasions.

Naturally low in lactose, the cheese portions suit the needs of today’s busy families with hectic schedules who snack more frequently but want healthier, all natural and fresh ready to eat options.

Yummia Yoghurts unveils new recipe

Yummia has unveiled its newly improved product recipe for its Yoghurts, just in time for its move into the dairy section of Woolworths stores nationally, this month.

Continuing its leading legacy in the FMCG industry, Yummia’s innovative Yoghurt is the first of its kind, with its unique combination of fruit and vegetables in a yoghurt. Providing consumers an easy, healthy, on-the-go snack, the Yummia Yoghurts are challenging the norm with their clever blend of ingredients.

“The Yummia Yoghurt recipe has been slightly enhanced to ensure each tub is packed full with as much delicious goodness as possible. Our move into the Dairy section from Grab n Go in Woolworths will bolster the brand and secure its place as a leading product in the Yoghurt category,” said Founder and Owner of Yummia, Mia McCarthy.

Using thick strained premium Australian yoghurt, Yummia Yoghurts are a natural source of calcium and protein, with each 150g tub containing 10g of protein. The Yoghurts are available in two flavours, Strawberry & Beetroot and Apple & Carrot. The products can be enjoyed on their own, in smoothies or accompanied with fruits, nuts and cereals.





Is the dairy industry in Australia set to sour?

Over the past 10 years, the Australian dairy industry has performed something of a miracle considering the various circumstances it faced. Sam Murden asks if this is likely to continue.

Any farmer worth his/her salt across the country would point to the Millennium Drought – the drought affecting most of Australia from 1995 to 2009 as the darkest days for the agricultural sector.

It’s worth remembering that in the past, Australia had previously relied solely on water from dams for agriculture and consumption. The drought changed the way Australia treated its water resources, placing tough restrictions on industries.

Add on the impacts of the Global Financial Crisis in 2008, which significantly slowed Australia’s economy and trade and the situation for Australia’s dairy industry looked dire.

Eight years later, the dairy industry in Australia has survived against all odds and has been experiencing a relatively slow trend towards growth.

But new challenges have come to fruition. According to the specialist advisory business focusing on the Australian Food & Beverage industry, Comet Line Consulting’s Ben van der Westhuizen, Dairy has been the most active sector in the domestic and international industries.

“The demand for Australian dairy products in Asia resulted in a rush to secure supply and gain access to expanded ranges,” van der Westhuizen said.

“We expect the pace of the deal making sector in the dairy making sector to continue well into the latter half of 2016. Investors are seeking to secure source of supply and create opportunities to expand product ranges in order to meet the rising demand from Asia and specifically China.”

Global dairy production

In October 2015, New Zealand dairy co-operative, Fonterra, sold a 9 per cent shareholding in Bega Cheese (which it had acquired in 2013). The shareholding in Bega Cheese was considered

non-strategic and Fonterra intends to invest the proceeds on disposal in higher value-add dairy products.

Global demand for dairy remains sluggish. The main factors affecting demand are declining international oil prices, economic uncertainty in a number of emerging economies and a slow recovery of dairy imports into China. On the supply side, in Europe, milk volumes have continued to increase significantly and these surplus volumes are being exported.

Declining international oil prices have weakened the spending power of countries reliant on oil revenues. As many of these countries are major dairy importers, the situation has contributed to the weakening of global demand for dairy.

Although New Zealand farmers have responded to lower global prices by reducing supply, that has yet to happen in other milk production regions, including Europe where milk volumes continue to increase.

It’s not just industry analysts that are keeping a close eye on the increasing role of China’s renewed interest in Australian dairy products and, in particular, it’s powdered milk.

The story is in the stats

Each year, the Australian Department of Agriculture and Water Resources publishes an annual compendium of historical statistics covering the agriculture, fisheries, food and forestry sectors.

The report also contains statistics on agricultural water use and macroeconomic indicators such as economic growth, employment, balance of trade, exchange rates and interest rates – alternatively known as the Australian Commodity Statistics.

In the 2013-14 period, milk exports grew slightly from the period year: 9, 372ml in 2013-14 up from 9,317ml in 2012. 2014-2015 saw a substantially larger increase in milk production with almost 9,732 ml being produced.

Interestingly, butter and cheese production over the last three years has largely stagnated – cheese production in particular has not risen above 350kt since 2009, whilst butter fluctuated from 4,142kt in 2011 to 4,542kt in 2014.

For Dairy Australia Industry Analyst John Droppert, lower milk flows had given Australian processors room to move in adjusting their product mix to optimise returns in response to lower commodity prices.

“Continuing supply growth is the key factor keeping the market depressed, but prices are ultimately a function of the supply/demand balance, and dairy demand hasn’t kept pace,” Droppert said.

“In recent months, growths in global demand have been relatively small and on a slowing trend as inventories have built up.”

Since the dairy industry is a predominant source of greenhouse gas emissions, pressure to reduce them was expected from the Government.

The National Farmers Federation therefore developed a strong policy position on agriculture reduction schemes, and Dairy Australia has had significant input into it.

“The dairy industry needs new skills and capabilities to respond to climate change. Some capabilities can be brought in via strategic alliances (i.e. climate science and seasonal forecasting) when building specific dairy industry capability is not appropriate,” Droppert said.

Regional challenges remain, especially where drinking milk is the focus: significant differences exist between the industry’s geographic regions from both a natural resource and economic perspective.

The WA, QLD and northern NSW regions are closely tied to the fresh drinking milk market with a requirement for more expensive year round supply systems on farms.

In other regions there is volume manufacturing capacity (cheese and powders) and farm gate pricing is much more closely linked to the international commodity prices. There has been a trend towards consolidation of manufacturing in SE Australia which is unlikely to be reversed.

The recently announced arrangements between industry co-operatives and a major retailer may lead to changes for the drinking milk supply market, with new processing capacity intended in Melbourne and Sydney. The touted “price premium” may provide more dairy farms with improved profitability and longer term financial certainty but this is yet to be proven.

In any case, addressing the diversity of needs across Australia’s dairy regions is one of the key challenges in delivering appropriate research development and extension services.

NSW Dairy defies expectations

The NSW dairy industry is worth about $497 million in gross value of production in a total state value for agriculture of $12 128 million. The NSW industry is based largely (around 70 per cent) on the production of milk for domestic consumption, mainly fresh bottled milk.

NSW has the widest differences among dairy regions of any Australian state, as highlighted in the variety of feedbase systems. These differences even out the quality and quantity of milk supply during extreme weather events, making them a distinct advantage during bad weather.

The NSW dairy industry has undergone a decade-long period of consolidation and rationalisation throughout the supply chain. Milk pricing has fluctuated from year to year as a result of competition between the major processors in negotiating supermarket supply contracts, the ‘milk price war’ between the two major supermarket chains, and a lack of processing capacity to deal with milk supply over and above the needs of the liquid milk market.

Despite indications of strong demand for dairy products globally, NSW dairy farmers must continue to manage their businesses to account for a range of external risks in order to remain viable. Dairy production systems in NSW will need to be adaptable and resilient in the face of the likely market volatility affecting milk price, labour supply, climate and input costs. Farm incomes are under pressure from milk pricing competition, increasing input costs slowing of productivity growth in recent times.

Challenges to growth in NSW include managing a dairy business in an increasingly uncertain and volatile environment, the influence of processors and the milk marketplace, managing pasture-based farms in a changing climate, declining herd fertility, and access to resources and markets in an increasingly urbanised south-eastern Australia. All of these factors increase risk.

The challenges that the dairy industry faces on the road to maintaining sustainability are too difficult for any one organisation or company to face alone. Ultimately, cooperation between farmers, manufacturers and producers can alleviate (but not prevent) the impact that falling prices would have on the market.

Dairy alternative consumption to reach $19.5 billion in 2020

Dairy alternative consumption is set to rapidly rise globally as Asian-Pacific consumers increasingly turn to products like rice milk, soy milk and almond milk.

According to a MarketsandMarkets report, global consumption of dairy alternatives projected to grow 15.2 per cent over the next five years.

Dairy alternatives are lactose-free, which resemble a milk-like texture and are used to replace dairy-based products. They are produced through various cereals such as oats, rice, wheat, barley, and nuts.

Globally, the health benefits of dairy alternatives have led to its large-scale adoption in numerous applications.

Changing lifestyles, growing health awareness, increasing cases of lactose allergy, and growing application sectors are some of the factors driving the growth of the dairy alternatives market.

The Asia-Pacific region dominated the dairy alternatives market last year, and is set to nearly triple in size over the next five years.

“The growing health awareness, rising preference for vegan diet, and rising cases of lactose intolerance and milk allergy in this region are also driving the market,” the report said.

In order to improve the nutritional value of products whilst increasing sales, dairy alternative manufacturers are presenting new flavours and fortified products, including those with calcium and vitamin D, to the market.

Some companies may use the term ‘dairy-free’ to describe lactose-free or low-lactose products for those consumers with lactose intolerance. Or they may use it on products that are free of traditional dairy ingredients such as milk and cream but not free of milk derivatives such as caseinates or whey.

However, if the products contain milk protein, they are unsafe for individuals with milk allergy. Unfortunately, those with milk allergies cannot rely on "dairy free" claims and will need to scrutinize the ingredient statement for evidence of milk.

While non-dairy is a term that is frequently used on coffee creamers, it is also used similarly on various other products containing caseinates.

Many in the industry are excited to see a natural evolution of businesses that aim to address weight, lifestyle and diabetes concerns.