Westland whips up sales

Westland Milk Products has secured a new large-scale Chinese order for UHT cream from a new customer.

The news comes as the dairy cooperative works hard to retain its farmers, some of who have threatened to shift to Fonterra or Synlait.

Chief executive Toni Brendish said the deal for Westgold UHT cream was with 85°C Bakery Cafe and prospects were for the market to grow.

’’This is a good example of our new focus on the food service sector in China,’’ Brendish said.

‘‘By developing mutually beneficial relationships with key accounts and major distributors, we are able to use their resources, tied in with our expertise in high quality production using New Zealand milk, to gain traction for Westland in markets that have enormous potential.’’

The 85°C Bakery Cafe is a Taiwanese-owned chain of coffee shops with almost 1000 branches located in Taiwan, China, Australia, Hong Kong and the United States.

The Westgold cream will be used in the mainland China stores at this stage.

The deal comes as pressure mounts on Westland from disgruntled suppliers who are disappointed in the co-operative’s forecast milk payout of between $5.40-$5.80 per kilogram of milksolids.

Consultant Will Wilson, who is acting for Canterbury dairy farmers, said Westland farmers would receive $1.30 kg/MS less than Fonterra farmers, once the payout and dividend was taken into account.

‘‘Assuming average farm production of 245,000kg, that makes $320,000 difference between Fonterra and Westland.’’

He said he knew of 20 per cent of suppliers, all in Canterbury, who were going to give notice in May that they wanted to leave Westland by May 2018. Their total volume amounted to 15 million kilograms of milksolids.

Wilson said Westland had to either trade its way out or borrow to boost supplier returns.

He questioned if farmers would want to stay with the co-operative, even if offered a better price, because it would continue to be crippled by debt.

However, Ashburton farmer Kurt Harmer, who said last year he was thinking of switching companies, is now more optimistic over Westland’s direction.

‘‘They have been upfront and things will turn out OK,’’ he said.

Meanwhile, Westland has been hosting a delegation of eight Chinese chefs from some of the country’s most prominent restaurants and hotels.

Organised by the New Zealand Talented Chef Exchange Association, the delegation of senior chefs was treated to home-baked scones made with Westgold butter and cream and topped with local jam at Westland’s Rolleston plant last week.

Westland’s marketing manager Charlotte Sullivan said the visit was an opportunity to talk directly with people who were at the front line of food trends in China and learn more about their dairy requirements.