KUALA LUMPUR (June 15): Fraser & Neave Holdings Bhd (F&N) is venturing into the upstream fresh milk business, following the ground-breaking ceremony of the group’s integrated dairy farm in Gemas, Negeri Sembilan, with an investment of at least RM1 billion for the development of Phase 1 of the farm.

The farm is expected to put the group on track to becoming one of Malaysia's largest milk producers, when Phase 1 reaches full production of 100 million litres of fresh milk.

Spanning over 2,726 hectares, the farm will eventually house 20,000 dairy cattle, producing 200 million litres of fresh milk per year for the local and international markets, said Negeri Sembilan Menteri Besar Datuk Seri Aminuddin Harun.

Speaking at the F&N AgriValley ground-breaking ceremony here on Thursday (June 15), he said the project, which will be developed in phases, is expected to be fully completed by 2027, create 500 jobs, as well as provide agro business opportunities for the local community.

“This project will also reduce the country’s dependence on imported milk, aside from enhancing the nation’s food security.

“The megaproject is in line with the state government’s aspiration towards realising the Smart Agro concept to develop an Agropolis cluster as outlined in the Negeri Sembilan State Structure Plan 2045.

“Furthermore, the establishment of a research and development (R&D) centre or F&N Centre of Excellence for dairy and agriculture will contribute to increasing the number of skilled professionals in the fields of veterinary medicine, animal nutrition, agronomy, food technology, and food R&D," he said.

Aminuddin added that other initiatives in the Agropolis cluster that will be developed by F&N include the development of ruminant valleys, which is the use of high technology in the field of agriculture in particular, in the field of crop planting, and dairy cattle farming.

The use of technology gives a modernising aspect to agricultural operations and food supply, thus changing the public's perception of the agricultural industry, especially the cattle industry, he said.

He said the state government strongly encourages more efforts and programmes that involve the surrounding community, such as the contract farming initiative, to provide employment opportunities to local residents, as well as improve the abilities of local dairy entrepreneurs.

Meanwhile, F&N chief executive officer Lim Yew Hoe said operationalising the integrated dairy farm would result in a vertical integration of F&N's business and operations.

“It means reducing our reliance on imported milk for downstream production and distribution, and will also help lower the cost per litre of fresh milk, benefiting Malaysian consumers,” he said in a joint statement with the Malaysian Investment Development Authority (MIDA) on Thursday.

Lim said the processing and packaging line will be situated right next to the milking parlour, enabling it to offer Malaysian consumers quality fresh milk at affordable prices.

“This will also help promote the growth of the local agricultural industry by fostering a skilled workforce and generating job opportunities in the dairy and agriculture industries,” he said, adding that F&N also aims to export fresh milk, potentially making Malaysia a net exporter of fresh milk in the future.

The ground-breaking ceremony was officiated by Aminuddin, alongside Negeri Sembilan state secretary Datuk Mohd Zafir Ibrahim, MIDA deputy chief executive officer Sivasuriyamoorthy Sundara Raja, and F&N chairman Tengku Syed Badarudin Jamalullail.

Meanwhile, Lim said F&N's plans for feed crop farming within the facility align with the government's goal of increasing feed crop production to reduce the nation's dependence on imported feed.

Malaysia currently imports nearly 100% of its animal feed from Brazil and Argentina.