‘Look north and go north’ is the mantra of Australia’s largest dairy food company and China, in particular, is ‘the game’.
That was the message Murray Goulburn’s managing director gave farmers at Dairy South Australia’s annual Innovation Day, held in Mount Gambier.
In an interview-style presentation, with questions thrown by dairy analyst Steven Spencer, Mr Helou made it clear the company’s focus was on Asian markets.
«(There is) rampant growth in China, Indonesia and the rest of south east Asia,» he says.
«We need to posture our company and our industry in that direction and we’ll win.»
Mr Helou rejects predictions China will become self-sufficient by 2020.
«I disagree that China will stop importing,» he says.
«China will remain importing a great deal of dairy foods, particularly Australian dairy foods, if we make the product they want in the form that they need it.
«I think Asia will be import-dependent, I think China will be import-dependent for the next 10 or 20 years.»
Mr Helou acknowledged emerging competition in the sector, urging farmers to consider where their milk was going.
He told the crowd of about 200 dairy farmers to look beyond the short-term promise of milk prices.
«Focus on the milk price today but importantly focus on where your processor is taking it into the future,» he says.
«There’s short-termism and there’s long-term sustainability.
«Go with a processor that gives you a great price today but obviously offers you the opportunity to partake in the growth that Asia represents.»
Growth was the key word of this year’s Innovation Day, with speakers honing in on farmers’ confidence.
It was a far cry from last year’s event.
In 2013 Dairy SA ditched words like innovation and investment, instead putting together ‘a conference for dairy business resilience’.
Most farmers agreed they were in a far better position than last year but there were few capable enough to turn confidence into investment.
«The hole we dug last year was pretty deep so it’s taking a long time to catch up,» Kongorong Dairy’s Barry Bruce says.
«We’ve got an awful lot of debt on our business and so we have to bank a certain amount of money every day of the year and milk price is the only thing that makes that happen.»
Victorian farmer Will McDonald is a rare young face in the industry and says he is looking for opportunities to invest.
«I’m very highly geared as a young fella but stupid enough to work hard I suppose,» he says.
«We’ve invested in the genetics and invested in feed and this year we’ve sort of managed to pull ourselves a fair way out of it.
«We’re not there yet but we’re getting there.»
Source: ABC