Westpork buys farms, says demand strong
Westpork boss Neil Ferguson is bullish the Australian pork sector will rebound from a topsy-turvy year, flagging the upbeat view as catalyst in acquiring two former GD Pork operations.
Mr Ferguson revealed last Wednesday the company had agreed to purchase GD Pork’s Kojonup and West Pinjarra farms, after the failed piggery went into administration in November owing creditors $40 million.
The move increases Westpork’s stake in WA’s piggery trade from 35 per cent of the State’s total production to about 45 per cent, with the producer already boasting six piggeries and four contract farmers.
Mr Ferguson told Countryman the move was underpinned by a strong faith the nation’s pork prices would regain strength in the wake of global oversupply causing last year’s low pork prices which knocked the industry.
“We believe in the demand for pigs and the future of growth in the pig industry,” he said.
“Demand for pork has been strong. The industry did have a downturn, but it is because supply outgrew that demand and demand throughout the period did remain strong.
“We thought GD Pork was a longterm industry player and regrettably they went into administration so we took the opportunity.”
The purchase price of the two farms remains undisclosed, with the sale completion earmarked for later this month.
Mr Ferguson said Westpork would work with the Department of Water and Environmental Regulation to upgrade the waste treatment systems at Kojonup and West Pinjarra assets.
He ruled out placing a dollarfigure on the respective upgrades.
“Some of the upgrades will commence straight away after settlement,” Mr Ferguson said.
“Other upgrades will be subject to approval, so we will need to go through the approval process DWER has in place.”
Last year’s record-high grain prices and burgeoning competition from international competitors, alongside the over-supply caused by increased productivity, cost WA pig farmers about $60 per pig produced. Former Pork CRC chief executive Roger Campbell also championed the industry’s resurgence last month, tipping it to emerge from the downturn “stronger and more resilient”.