Steen Loendal, executive vice-president of the Chr Hansen flavour division, told FoodNavigator.com that the expansion will bring it closer to its European customers.
"Before, we were importing ingredients from the US ," he said .
"Now we can make everything in Europe and can add more value to the raw materials.
"It supports our strategy to develop and maintain close relationships with our customers and our ability to supply the market in the best and most flexible way."
The Dairy Flavor Production Center will be located on the existing site in Graasten, in southwest Denmark, and will be fitted out with state-of-the-art equipment in order to ensure a high level of quality, flexibility and speed to market.
The larger centre will allow the ingredients developer to have full control over the entire process involved in the production of flavours, whereas previously it had had to import enzyme modified cheese from the US for its customers as well as for use as a raw material in its flavours.
The market for dairy-flavoured products is growing steadily.
Chr Hansen's expansion will also enable the growth of its R&D department, opening up new opportunities for broadening its product range.
"The dairy flavours area is very successful and innovative," said Loendal.
"Therefore the major challenge will be to develop new and innovative products and solutions in close cooperation with our customers.
The uniqueness of Chr Hansen is our combined enzyme and fermentation technologies which allow us to create very specific dairy flavour profiles based on dairy ingredients ."
Previously the centre has been involved in the production of cheese enzymes.
But with the new production platform, it is stepping out into fermented butter flavours, compounded dairy flavours and enzyme modified dairy flavours.
Chr Hansen will be presenting its new portfolio of dairy flavours at FIE 2007 in London, as its aims to equal its standing it Europe to that of the North America.
Christian Rolf Jacobsen, vice-president of commercial development in the flavour division, said: "Successful and innovative flavour development is a result of close collaboration between our competent flavourists, scientists and customers' technical staff.
Our creation group in Hoersholm , Denmark is ready and able to address the customer's most challenging flavour needs quickly and economically with consideration to labelling and regulatory requirements."
As well as the centre in Denmark
, Chr Hansen has eight flavour production sites around the world, and regional dairy flavour development centres in South America, North America, and Europe.
It hopes to expand further in the future, eventually reaching Asia and the Middle East.