Dairy Industry takeover seen as positive

Workers at Nestle in Echuca, Victoria are hopeful that the purchase of the business by diary giant Fonterra will strengthen the future of the operation.

Fonterra, a New Zealand owned company which is the largest milk company in the world takes over the Nestle yoghurt business in September.

Under the agreement, Fonterra will also acquire the long-term rights to manufacture, market and sell Nestle’s yoghurt and dairy dessert brands in Australia under license, alongside its own existing brands. The Ski brand, which is currently under license to Dairy Farmers, reverts to Nestle in 2012, and will then be licensed to Fonterra.

Fonterra intends to keep all but one of the existing 128 staff.

Victoria’s Australian Manufacturing Workers’ Union (AMWU) Regional Secretary for Food and Confectionary, Tom Hale, said the workers were worried that there would be more job cuts after Nestle cut about 50 jobs from the factory last year.

“I think the buyout will be able to grow the Echuca business, particularly with Ski coming back in the next couple of years,” he said.

Hale said that Fonterra is in an advantageous position given it’s a milk company.

“Because of the drought, dairy farmers aren’t making enough to buy water, so they’re reducing their herds and milk is becoming more expensive.

“Fonterra will be selling milk to themselves now that they have ownership of the yoghurt operations.”

Hale said the AMWU was organising to meet with Fonterra to discuss a smooth transition of business for the workers and to ensure that their entitlements are protected.

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Tom Hale


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