The two will convert fresh goat milk directly from farm gate into infant formula nutritional base, without intermediate spray dry to whole milk powder. This process is said to deliver a fresher product, with better taste and solubility.
The deal will see Bubs manufacture the products at the Tatura facility in Victoria and canned at Bubs’ existing CNCA licenced manufacturing partner, Australian Deloraine Dairy.
“Now we have reached scale, we are delighted to partner with Tatura, one of Australia’s largest and most reputable infant formula manufacturers,” said Kristy Carr, Bubs Australia founder and chief executive.
“Being able to produce our goat infant milk formula in a single step directly from farm gate is an ‘Australian first’ for goat dairy, that is only made possible because we have exclusive ownership of fresh goat milk from the largest milking goat herds in Australia.”
Conventionally raw milk from multiple sources is converted to powder, then rehydrated (often months later) and wet mixed with additional ingredients and nutrients, and then spray dried again Carr explained. This one-step nutritional blending and conversion of goat milk will bypass the intermediate step and therefore deliver a “fresher product, an improved nutritional and taste profile, and better solubility when made up for consumption”.
Successful trials have been completed and initial commercial production is set to start in March.
Bega CEO, Paul van Heerwaarden, said the team is excited to be partnering with Bubs Australia on this new venture.
“We have been working closely with Bubs to develop an infant formula of the highest integrity and quality aimed at satisfying the increasing demand for both goat milk formula and a product that can be genuinely positioned as Australian,” van Heerwaarden said. “We look forward to helping Bubs achieve its growth ambitions.”
The new formula will also have higher levels of prebiotics (GOS) to aid digestion, in addition to Omega-3 DHA and Omega-6 ARA.
“Parents in Australia and abroad are looking for authentic provenance and traceability when it comes to infant nutritionals. With the goat milk supply chain under our control, and using only Australian fresh goat milk, we will be able to label the product with ‘Made in Australia from average 70 per cent Australian ingredients,’ which will be unrivalled in this market. We aim to further increase our Australian sourcing of total ingredients to over 90% within 12 months,” said Carr.
Bubs’ first-half revenue soars
On Thursday Bubs reported sales for the six months to December 31 rose more than sixfold to $19.5 million.
However, first-half loss more than doubled to $8.8 million following investment in scaling up to meet demand from China.
The company said “high costs associated with developing products suitable for direct importation into China” and with meeting regulatory requirements resulted in a fall in earnings.