BGA General Discussion, page-133

Fonterra's been looking to get out of its retail products and eight Oz dairy factories for two years: wants to concentrate on food service and hospitality.

Bega and Canada's Saputo may well try to buy assets. Currently (under a 25 year agreement) BGA licences its barnd name to Fonterra. Lactalis is the third player. The 'big four' including Fonterra control 80pc of the market in Oz, but imported butter and cheese (principally from NZ) is cheaper due to the higher price per kilogram for Oz's milk solids.

Imports of dairy products rose 25 per cent in 2022-23 while exports fell 16 per cent.

Hard for dairy farmers to expand as (until recently) rural land prices have risen, so there's competition from beef and sheep farmers plus Canadian pension funds, the latter establishing timber plantations.

2 June 2024 is the deadline for when processors must announce how much they will pay farmers per kilogram of milk soilds.

Shoppers need to buy Australian, not NZ. (This appeal to patriotism is rarely successful).

Western Star butter has a future (iconic like BGA's Vegemite) but what of Fonterra's Victorian factories at Cobden in western Vic, Darnum in West Gippsland and Stanhope in northern Victoria?

The article implied Saputo would face FIRB approval problems (but Saputo has seen Australian losses balloon).

While unstated in the article, it's not hard to predict a CR by BGA, hopefully with an SPP for we retail peasants so we're not diluted.