WARRNAMBOOL Cheese & Butter (WCB) says that the company is in need of more milk and will be investing $10.3 million in plant upgrades and capability, with more planned in expansion phases.
The dairy company issued a statement saying it is "investing and growing and requires more milk".
"This investment requires additional milk to meet new customer demand requirements. A communication campaign has been launched to invite dairy farmers to join WCB this season."
WCB said its campaign will include the extra step of an open letter published in newspapers to explain the rationale for the company's additional milk requirements.
“The letter is one of a number of ways we are reaching out to those farmers wishing to consolidate and grow their businesses over the longer term," said WCBs CEO David Lord.
“We wanted to clearly explain the need for additional milk to support our growth strategy. The strategy is working and we are expanding our capacity. This presents an opportunity for existing and new milk suppliers, alike, looking for security and strong long-term returns.”
“The new investments are commercial decisions reflecting our performance in the export and domestic marketplace. The successful capital-raising last year enabled WCB to retire debt and make a substantial operational investment over the past 12 months to meet new customer demand.
“We are investing $5 million in new capability in our Allansford powder plant and expanding the capacity of our Sungold milk plant by 50% with $3.5million as part of an initial phase. We are also upgrading our specialty cheese operation in Mt Gambier”, he said.
Mr Lord said the investment is creating new capacity, capability and jobs in the region for the longer term.
WCB also announced this week a final step up payment for 2010/11. This increase takes the final 12 month average price to 42.5 cents per litre or $5.75 per kilogram milk solids equivalent, the second highest milk price paid in the company‟s 122 year history.
To support the push for additional milk, WCB has revamped its payment package for the 2011/12 season and announced a strong opening price for the 2011/12 season of 36.5cpl or $4.90 per kilogram milk solids on average across the year.
Anthony Cook, General Manager Milk Supply said, “We have been consulting with our dairy farmers and set up a new payment package which gives suppliers real choice, flexibility and improved cash flow.
“The arrangements have been well received, particularly the introduction of a "safety-net" which guarantees farmers the highest payment option”, said Mr Cook.
In the open letter to dairy farmers, Mr Lord outlined WCB's commitment to strengthening its relationship with existing and new suppliers.
“I believe the best way to achieve this is through both a competitive price and payment options that meet farmer‟s expectations”, he said.
In a further step, Mr Lord has put himself on the front line in support of the field services team offering to take calls from interested farmers.
“The WCB team would welcome the opportunity to sit down with you to discuss our package in more detail as it would apply to your individual farm system, Mr Lord said.
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