DAIRY JOBS BLOW
Geelong exporter goes bust as virus hits China sales
AUSTRALIA’S largest organic milk exporter is in voluntary administration after the Geelong-based business was broadsided with a collapsing Chinese market and the COVID-19 pandemic.
Organic Dairy Farmers of Australia this week announced it had called in administrators in a bid to rescue the struggling North Geelong business.
The looming collapse comes after the company received more than
$2.5 million in government grants in recent years.
AUSTRALIA’S largest organic milk exporter is in voluntary administration after the Geelong-based business was broadsided with a collapsing Chinese market and the COVID-19 pandemic.
Organic Dairy Farmers of Australia (ODFA) this week announced it had called in administrators in a bid to rescue the struggling North Geelong business.
The looming collapse comes after the company received more than $2.5 million in state and federal government grants in recent years.
Administrators Worrells Solvency and Forensic Accountants signalled that a “combination of a contracting Chinese market, delayed sales, and now the impact of COVID-19” was behind the directors’ decision.
The company’s growth strategy had focused on exports to China. Administrator Scott Andersen signalled some hope the business might be able to be returned to a healthy position if a deal was approved by creditors.
“Our goal, together with the co-operative’s directors, management and members, is to ensure that this integral and unique business continues to deliver its exceptional produce to Australians, and to the international market,” Mr Anderson said.
“We understand the enormous value and potential for the co-op. We have a robust strategy to turn around its predicament for long-term viability and success.”
Creditors will determine the future of the company by June 26, with an initial meeting scheduled for May 27.
ODFA contractors were notified of the move to voluntary administration via email on Tuesday evening, with water cartage provider Scott Richardson warning of potential “ripple effect”.
“Business is tough; and it’s hard for staff,” Mr Richardson said.
“You allocate the jobs to your staff and then you get that thrown in on top, and the money that’s outstanding to be paid; and, yeah, it has an impact right down the line to the farmer who relies on that waste for the food for their stock as well. It is a ripple effect.”
Organic Dairy Farmers Australia has been based in North Geelong since 2014.
In 2018 the company announced a joint venture involving a $55 million dedicated organic nutritional dairy powder dryer at its site, saying its workforce would triple to about 90.
The group received a $1.95 million Food Source Victoria grant and a $600,000 Geelong Region Innovation and Investment Fund grant.
YOU ALLOCATE THE JOBS TO YOUR STAFF AND THEN YOU GET THAT THROWN IN ON TOP, AND THE MONEY THAT’S OUTSTANDING TO BE PAID; AND, YEAH, IT HAS AN IMPACT RIGHT DOWN THE LINE TO THE FARMER WHO RELIES ON THAT WASTE FOR THE FOOD FOR THEIR STOCK AS WELL.”
CONTRACTOR SCOTT RICHARDSON