Dairy NewS AUSTRALIA december, 2012
news // 9
China eyes Lactanz Dairies Chinese beverage
giant, the Wahaha Group, is considering buying Lactanz Dairies, the biggest single producer of milk in Western Australia. Lactanz Dairies is on the market through Elders Real Estate for $30 million. Lactanz, near Scott River in the Southwest, made up of four farms, four dairies and about 4000 milking cows over 2344ha, is a major supplier to local dairy company Brownes. It produces nearly 90 million litres of milk each year. Elders rural property specialist Noel Jones hopes to sell the prime farm properties as an ongoing single business individually the farms are known as Iley, Fouracres,
Hartridge and Fox Farm before June next year. Zong Qinghou, chairman of Wahaha and China’s richest man, has said earlier this year that he is preparing to invest in raising cattle in Australia to provide raw materials for his Wahaha Group. After working with the WA government, Zong announced a plan to spend up to $220m on dairy farms and a new milk powder plant in WA to supply China. Wahaha is currently the largest milk powder importer in China due to the demand for milk beverages. Zong told China Daily that the high quality and low price of Australian milk made investment in dairy farms attractive. “(China) consumes
50,000 tonnes of milk powder a year, half of that imported,” he said. “Our investment in Australia’s dairy farms and related industry will guarantee stable supplies of quality milk powder.” The sale of Lactanz Dairies follows the unexpected collapse of the earlier sale of another of WA’s largest dairy farms, 900ha Ravenhill Dairy, to a Chinese buyer. Chinese investors had signed a deal in January to purchase Ravenhill Dairy, near Albany, but defaulted on the sale.
Lactanz, made up of four farms, produces nearly 90 million litres of milk each year.
The transaction was due to be settled in
plete the sale despite several deadline extensions,
and despite paying and losing a 10% deposit.
Expanding horizons together
Dairy outlook strengthens: NAB Global dairy prices have bounced back from a
mid-year dip, with the latest National Australia Bank (NAB) Agribusiness Rural Commodities Wrap forecasting prices to strengthen further in 2013. Dairy is NAB’s ‘commodity in focus’ for November. The report highlights the impact weather is having globally on both production and price. NAB’s weighted average dairy price in October up was up 13.3% since a trough in July, while prices were up 3.7% on a month earlier. NAB’s General Manager of Agribusiness, Khan Horne, says challenging conditions have cut global supplies. “The drought in the US and adverse weather conditions in Europe have combined with high global feed grain prices to see a reduction in the amount of milk predicted to be produced over the next 12 months. “This should support global dairy prices further through the first half of 2013.” In Australian, milk production is expected to reach around 9.4 billion litres in 2012-13, down around 1% on last year’s figure. “Regions with a strong export focus are continuing to outperform the rest, with year-to-date production in Victoria and Tasmania up on last year. “Good rain has boosted the availability of water across the Murray Darling Basin, providing solid support to production in those regions over recent years, and we’re expecting this to continue. “However, hot, dry conditions through spring elsewhere in the country have had an impact, reducing production in other parts of New South Wales as well as in Queensland, South Australia and Western Australia. Fortunately, expected step ups in price should help offset this.” Input prices were up in October. The NAB Weighted Fertiliser Index increased 4.9%, and a significant degree of upward pressure is also likely to be exerted on prices over the coming months. The NAB Weighted Feed Grains price recorded its sixth consecutive monthly rise, hitting its highest level since October 2008.
August, but the Chinese investors failed to com-
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