Brownes sale secures market in hungry China
WA dairy farmers hope the sale of Brownes to Chinese interests will put a floor under prices and help the industry grow.
Archer Capital announced yesterday it had sold WA’s oldest dairy to a consortium led by Chinese dairy giant Shanghai Ground Food Tech.
The new owners want to restart cheese production to meet demand in the Middle Kingdom.
WA Farmers dairy section president Michael Partridge said ownership by a Chinese dairy company would provide direct access into a fast-growing market.
Stronger demand for milk would naturally lead to more favourable and competitive contract conditions for suppliers.
“The new owner is talking about growth and talking about producing cheese, which is necessary in helping WA balance its supply throughout the seasons, which has been among our major challenges,” Mr Partridge said.
“This is not just good for Brownes’ suppliers but good for the whole industry and could set the foundation for sustainable growth.”
Brownes owns a cheese factory at Brunswick but it has been operating well below capacity for several years because it became unprofitable to manufacture big amounts and there were environmental issues with disposing of the whey.
Brownes’ managing director Tony Girgis told staff yesterday that he would remain as boss of the 130-year-old dairy, which employs about 280 people and is WA’s biggest producer of milk and cream and second-biggest producer of yoghurt.
He said there would be no job losses and that the new owners had “a track record of growing and strengthening similar businesses and have affirmed their commitment to doing likewise with Brownes”.
Archer Capital partner Jeffrey Lim said the Chinese were attracted by Brownes’ strong market position in WA, its brand recognition and reputation for producing the highest quality, locally sourced dairy products.
“Integral to the final outcome was finding a buyer with proven industry experience and a record of operating and growing similar businesses,” Mr Lim said.
Brownes said the deal meant the brand would “remain an integral part of the WA dairy industry for generations to come, while creating access to emerging overseas markets and the potential for new product development”.
“The consortium was highly attracted to the Brownes Dairy business and operations, its heritage and long history, and the possibilities Brownes offers to grow the Western Australian dairy industry given its strong geographic location on the doorstep to Asia,” Brownes said.
WA’s oldest dairy Brownes is looking to grow exports after its sale to Chinese dairy giant Shanghai Ground Food Tech.
Brownes chief Tony Girgis.