AN additional 60 million litres of milk bought annually from SA dairy farms will go towards boosting Beston Global Food Company’s cheese production.
More than 20 SA dairyfarmers from the South East through to the Mid North have agreed to supply milk to BGFC for its Murray Bridge and Jervois facilities.
The extra supply will supplement the 20mL per year BGFC already sources from its own farms, as the company plans to expand into other hard cheese varieties for the 2018 financial year.
BGFC chief executive officer Sean Ebert said the company expected to reach the required 2018 financial year target of 90mL in the coming weeks.
“All of the dairies involved have been supplying other national dairy food groups and were looking for alternatives,” he said.
“About 20mL is coming from our existing farms and on top of that there will be another 60mL coming from our new farms.”
BGFC plans to boost its cheddar products for its Edwards Crossing range at the Murray Bridge facility, which would include gouda, colby, cheddar.
At the Jervois facility, Mr Ebert said production would predominantly be mozzarella, but would also involve making other hard cheeses such as parmesan, gruyeye and tilset.
BGFC is in the process of installing a mozzarella plant at the Jervois factory and aims to produce a minimum of 5000 tonnes a year, with production expected to begin later this year.
At the start of this financial year, BGFC’s factories were processing milk at a rate of approximately 36mL/yr.
The extra milk supply will return the factories to a production rate similar to the rate they were operating at prior to closure in April 2015.
Despite farmers’ lack of confidence in the industry, SA Dairyfarmers Association president John Hunt said BGFC’s recruitment of SA farmers was a positive.
“Anything that encourages more milk suppliers has got to be good,” Mr Hunt said.
“It develops a bit of competition in the industry, that is what we are after, to create a demand.”
Mr Hunt believed many dairyfarmers had looked at swapping processors, mostly due to prices.
With tight cash flows in the past two years, it was an opportunity for farmers to get “out of the cactus”.
“Farmers have to do what is best for them on-farm,” he said.
“In SA, we are pretty fortunate that we have managed to create a demand – Midfield and Beston have come in.
“If people want our product, they have to pay for it.”
With processors announcing their opening milk prices for 2017-18, Midfield Group and Warrnambool Cheese & Butter offered the highest returns for dairyfarmers with prices of $5.50 per kilogram of milk solids.
Mr Hunt believes it was a “coincidence” the prices came out at the same level.
He said it would be better if processors justified their prices based on products and their factory productions.
“They all play the game where they do not want to open up until the last two weeks of the season and that makes it hard for farmers to budget,” he said.
He believed Midfield’s signing bonus should have been added to the payout.
“I think farmers would be a bit more confident not chasing gimmicks if you like – not like – ‘wait, there’s more’,” he said.
“We do not just want dairy farms to survive, we want to thrive and want the industry to grow.”