Acting chief executive David Mallinson yesterday wrote to Murray Goulburn’s 2500 farmer-suppliers, confirming speculation that its venture into the booming Chinese infant formula market may be shelved, delayed or changed.
Mr Mallinson said the company was “revisiting all its capital projects” in the wake of its current financial problems, after its farmgate milk price, profits and share price crashed this year following low global dairy prices and serious sales misjudgements.
“With this in mind, we are considering other potential locations for the nutritionals plant to ensure that we have the most appropriate and cost effective location,” Mr Mallinson told its farmers, who also own Australia’s biggest dairy processor and co-operative.
“No final decision has been made. We are also very mindful of the significant role Murray Goulburn plays in the communities in which it operates.”
It is believed likely that any future nutritional powder plant — if it goes ahead — will be built at MG’s alternative fresh milk processing site at Laverton, on Melbourne’s western outskirts, closer to Melbourne Port from where its exports leave.
Source: TheAustralian
Link: http://www.theaustralian.com.au/business/companies/murray-goulburn-to-revisit-plans-for-300m-infant-formula-plant/news-story/2eee4522f86488de9d1efb8113b2a76e