AT LEAST three dairy companies — and possibly four — have expressed an interest in buying Fonterra’s Dennington site.
Two companies have told The Weekly Times they were interested in the milk powder and cream production facility on the outskirts of Warrnambool, but have not had discussions yet with Fonterra.
The New Zealand dairy giant last month announced it would mothball the plant by December, with the loss of almost 100 jobs.
“We will wait until Fonterra puts it on the market,” one company representative said.
But Fonterra’s communications department steadfastly continues to maintain there has been no interest in the Dennington plant by dairy companies.
“Our position hasn’t changed from statements provided to you for the past two weeks,” a spokeswoman said late last week.
On May 29, when The Weekly Times reported two dairy companies told the newspaper they were interested in the Dennington site, the Fonterra spokeswoman said: “This just isn’t correct. We want to make it clear that we’ve explored all options for the site, including sale, but with no genuine interest, and in a low milk pool environment, the most responsible option is to close.”
Federal Wannon MP Dan Tehan said he was told by Fonterra Australia managing director Rene Dedoncker that if dairy companies were interested in buying the Dennington site, he would consider talking to them.
“Any company that comes into the market and is into high end value-adding and adds competition for milk, that has to be good for the dairy farmer,” Mr Tehan said.
Dairy farm leaders remain non-committal on whether Fonterra should sell the plant, saying the oversupply of manufacturing capacity could be a counterbalancing argument.
Australian Dairy Farmers president Terry Richardson would not be drawn on whether Fonterra should sell the Dennington plant or not. “While we applaud the competitive dynamic in the market at the moment, we have to look at the overall structure of the industry to see whether this (a sale of the Dennington factory) is in the best interests of the farmers,” Mr Richardson said.
United Dairyfarmers of Victoria president Paul Mumford said he could see both sides of the argument on sale or retention of the site, but Fonterra should declare its plans for the Dennington factory.