Agribusiness buzz in brief

Agribusiness buzz in brief

Agribusiness
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A quick check around the traps at what some of the players in agribusiness have been doing and talking about

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Fonterra's China exit

New Zealand-based dairy processing and marketing behemoth, Fonterra has confirmed sale plans are proceeding for its two wholly-owned dairy farm hubs in China for about $500 million.

The buyer, to the Inner Mongolia Natural Dairy company,is a subsidiary of the livestock company China Youran Dairy Group and has been granted anti-trust approvals to take over the model farm developments established about five years ago as part of Fonterra's market development efforts in China.

The sale is expected to be wrapped up by June.

In October Fonterra also announced it was selling its 85 per cent stake in its Hangu farm to Beijing Sanyuan Venture Capital Company for almost $40m as part of a debt reduction push and a realigned focus on NZ milk production sector priorities.

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Murray River 'turnaround'

Struggling Victorian-based breakfast food and snack business Murray River Organics has sold its Fifth Street Merbein table grape property in the Sunraysia region to US-owned Manta Farms for $5.5 million to help cut back its debt load.

The latest sale follows an earlier debt reduction move, offloading its nearby Nangiloc citrus and winegrape property to Costa Group, and bringing the total value of recent non-core asset sales to $10m.

"The sale of our table grape property represents a further milestone in our turnaround strategy," said managing director, Valentina Tripp.

The company was focusing on its core organic dried vine farming ooperations and growing our Murray River Organics branded food portfolio.

Meanwhile, former Ruralco and Indigenous Land and Sea Corporation boss, John Maher, joins the company's board after the November resignation of Stuart McNabb.

Mr Maher's growing list of boardroom commitments feature directorships with corporate farm manager GoFarm Australia, mushroom grower White Prince and AWN Food and Fibre, as well as advisory work with big private equity group BGH Capital.

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Woolies' new 'dark store'

Woolworths has expanded its online distribution operations by about a third, opening a massive 15,000 square metre "customer fulfillment centre" in Sydney in December.

The site, its third "dark store" in Sydney and the fifth in Australia, enables the supermarket to increase its online capacity by about 20,000 deliveries to customers in inner western Sydney, the lower North Shore and Botany Bay areas.

Woolies online food sales exceeded $960 million in its first quarter of this financial year, equating to about 8 per cent of total supermarket sales.

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ADM retreats from lysine

The corn syrup by-product at the centre of a big 1990s US corporate scandal, and popular film, is to be phased out of production by multinational agricultural commodities trader and processor Archer Daniels Midland.

ADM is winding back production of the fermented amino acid product dry lysine, which is used in animal feed to promote muscle growth rather than fat, and to help production performance in dairy cows and layer hens.

It is also increasingly popular as a human health supplement ingredient.

Although ADM will continue producing liquid and encapsulated lysine products, the Illinois agribusiness giant's margins have been under increasing pressure from rising lysine production in China in the past decade, prompting the company to steer away from such market volatile commodities.

In 1996 ADM was fined $US100 million after pleading guilty to price fixing charges involving lysine in a real life drama which later became the subject of a box office movie hit, The informant, starring Matt Damon.

The scandal cost the company three of its top executives, including vice chairman Michael D. Andreas, who were eventually sentenced to prison in 1999, while additional fines were imposed by Canadian, European and Mexican competition regulators.

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Copycat wine protection 

Wine Australia is establishing a Wine Export Label Directory to help brand owners protect their export wine labels against copycat branding.

Legislation passed through federal parliament at the end of 2020 will enable an online database of all Australian export wine labels to be established by April.

Consumers and retailers overseas will be able to upload an image of any wine label they find and compared it to a list of genuine exported Australian wine labels.

"This directory, overseen by Wine Australia, will further build the confidence that discerning international consumers have in Australian wine," said Agriculture Minister David Littleproud.

"Australia has a reputation as a producer of premium wines and it's important we support an industry that directly employs over 69,000 people to protect its brand."

Canberra is backing the directory by committing $417,000, plus additional contingency funds, from the federal government's $50 million Export and Regional Wine Support Package.

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New Beston director

Dairy processing industry executive Neil Longstaff commences directorship duties on the Beston Global Food Company's board, replacing Jim Kouts who stepped down on December 31.

Mr Longstaff, who spent 20 years in executive and consulting roles with dairy players such as Murray Goulburn and Kyvalley Dairy Group, has had broad commercial experience with domestic and export markets.

He has also worked in marketing roles with SPC, Lanes Biscuits Heinz and Nabisco.

Beston chairman, Roger Sexton said the recent appointment of Mr Longstaff and Joanna Andrew would expand the board's bench strength in the dairy and nutraceutical areas and provide options for succession planning.

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Freshcare is prepared

Former Scouts NSW boss Jane Siebum (pictured) started work as chief executive officer of horticulture industry-owned and operated assurance standards body Freshcare this week.

Ms Siebum's experience in business transformation across various industries and not-for-profit organisations includes being a past president of the Bowen Pastoral Agricultural Association, and with the Women in Prisons Advocacy Network.

Freshcare chairman Allan Dall said as the custodian of Australia's most widely used standards in the horticulture and viticulture sectors the body had an obligation to have the right corporate structure and financial capacity to continue to deliver in the long term.

"After an extensive search we are very confident that Jane, with her authentic leadership, out-of-the-box thinking and broad skills, is absolutely the right person to lead the organisation and deliver for our participating businesses, members and the industry," he said.

She replaces interim CEO Yvonne Diabin.

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