Pokeno's $212 million infant milk formula factory has hit an eight-month delay as it works its way through red tape.

The Chinese -owned Yashili International Holdings plant was due to kick off production in February, and gradually build up to full operation over this year. 

While commissioning is underway and going well, according to Yashili New Zealand managing director William Zhao, the official opening has been put off until October.

That was largely thanks to approval needed from complex food safety regulations - currently being revised - in China. It meant months of delay between sending in applications and getting anything back, he said.

Yashili also needed to complete its New Zealand registration for canning and blending, which Zhao said he hoped to have by the end of May. However, the plant risk management program had been approved. 

In the mean time, commissioning would continue which meant staff were being taken on at the plant. Once it is fully operational, 130 will be employed there. 

The plant had been fully fired up on several separate occasions, each for a longer period of time than the last. 

During a four-hour production run, it produced roughly 30 tonnes of formula, said Zhao. 

That is thanks to a 41 metre spray-dryer able to produce up to 8.4 tonnes of powder an hour. When the plant is fully functional it will pump out 52,000 tonnes of infant milk formula each year, all headed for China. 

So far, seven trial batches of infant milk formula had been produced from reconstituted skim milk Yashili had bought from Westland Milk Products in the South Island.

The plant would revert to raw milk once all consents had been approved, said Zhao, although that also depended on Yashili finalising a milk supply deal. Zhao said he was now hoping to have a deal signed off before the start of next season. 

Laurie Margrain, Chair of Open Country Dairy, said the company was not currently supplying milk to Yashili, "but that doesn't mean at some point we won't".

He confirmed Open Country Dairy was in talks with Yashili, as were a "number of other" industry players, but said no final decision had been made that he was aware of.

Mike Burgess from Fonterra's communications team confirmed the co-operative was also in talks with Yashili.


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