Adelaide-based food company Beston has announced it will buy troubled milk processor United Dairy Power (UPD) and reopen plants in Murray Bridge and Jervois.
Up to 130 jobs were lost when UDP went into receivership and closed its facilities in April.
But Beston plans to re-open and upgrade the two plants with the aim of supplying “clean and green” dairy-based food products to Asia.
Beston spokesman Dr Roger Sexton said 12 jobs would be created initially with more to come when production ramps up to an expected 200 million litres.
“The sort of markets we’re taking our products into are gourmet supermarkets and they are on the increase in China,” Dr Sexton said.
“Many more consumers, as they get more income in their pocket, are voting with their feet and looking for products that they know are produced in Australia and can be verified as food safe.”
Mr Sexton said dairy farmers around Murray Bridge would be targeted for milk supply.
The announcement comes at a crucial time as South Australia grapples with the highest unemployment rate in the nation and 440 job losses at Alinta Energy.
Premier Jay Weatherill said it was companies like Beston foods that would help grow the state’s economy.
“The truth is we need to grow those fast-growing sectors of the economy more quickly than the declining sectors of the economy,” he said.
“The name of the game is to grow these new industries and this is just a fantastic example — it just about ticks every box in our economic plan for the future of South Australia.”
Darryl Webb from the local Regional Development Australia said the creation of dairy jobs would be a huge boost for Murray Bridge and benefit the whole region.
“With the closure of the factory recently, and now we have the chance of kicking up in September with that number of people, and potentially growing out to 130, it’s just such great news for the company, the old employees and our dairy farmers,” Mr Webb said.
Beston foods also has interests in biodynamic milk producer BD Farm Paris Creek and seafood processor Ferguson.
The announcement coincides with today’s signing of the free trade agreement with China.
By Angelique Donnellan