End of era for Kingaroy peanut industry as factory faces closure
The likely closure of the Kingaroy peanut processing facility has left a community reeling with the son of Qld’s most famous peanut farmer, John Bjelke-Petersen, saying his father would be “appalled”.
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The South Burnett is reeling at news of the likely closure of the Kingaroy peanut processing facility, with the son of Queensland’s most famous peanut farmer, John Bjelke-Petersen, saying his father would be “appalled” at the industry’s decline.
Bega announced on Wednesday it would close its peanut processing business, Peanut Company of Australia Pty Ltd, after a 12-month strategic review.
A “phased shutdown” of its facilities will occur in Kingaroy and Tolga, near Cairns, over the next 18 months.
With 135 jobs in Kingaroy on the line, and the future of 60 peanut farmers it has been grim news.
Mr Bjelke-Petersen said his father would have been “appalled” to see what had happened.
“Dad was involved in the peanut industry at the start and he was one of the pioneers relating to the thrashing of the peanuts,” Mr Bjelke-Petersen said on Thursday.
“It wouldn’t have gotten to this point (if he was involved), it would have been sorted out.”
“He would be appalled at the fact that the iconic peanut industry in the South Burnett and Kingaroy is in the situation that it’s in.
“It’s gone downhill in such a way.”
Bega Group CEO Pete Findlay said the company had not been able to secure an appropriate buyer and would be working closely with growers and employees during the transition period.
“We announced the strategic review over 12 months ago and we have pursued several options to sell the business,” he said in a media release.
“Unfortunately, we’ve been unable to secure a buyer that could sustain a long-term future for employees and growers.”
The announcement revealed PCA had been operating at a significant loss of between $5 million and 10 million per year.
South Burnett Mayor Kathy Duff said the region’s growers relied on PCA as their primary buyer.
The region’s residents now wonder what the future means, with several other small shops and businesses closing in recent years.
Leigh-Scarlett said with the lack of housing, infrastructure and shops, Kingaroy was “well on the way to being a ghost town”.
Charlotte worried about whether the loss of another manufacturer and the domino effect on local farmers could cause an economic blow to the region’s most populous town.
Julie expressed concern and despair at the news of another business closing.
“What is happening? Our towns will soon be gone,” she wrote.
While the overwhelming sentiments shared by South Burnett residents online was anger, worry or sadness, not all the commentary was negative.
Some raised the idea of turning the heritage listed silos into a tourist attraction, while upgrading the remaining facilities and continuing to operate the business as a peanut processing plant.
“It could employ the existing workforce to help maintain it and offer first-hand insights into its history and operation,” Shaun said.
“This would pair so well with our many natural attractions and local tourism businesses. Just some food for thought on a way forward.”
Others suggested innovative ways to keep the business going, like the workers banding together and buying the factory as a collective.
“Why don’t the workers buy the Kingaroy factory and continue on with the business? If it can be made profitable, they are the people to do it,” Sean said.
Some also proposed embracing the disruption and shifting focus to other areas where the region excels.
“Time to embrace the South Burnett wine region as a premier wine region,” Tony said.
Mr Bjelke-Petersen said even with the closure of the Bega facility, there would be peanut growers and producers in the South Burnett, like family-owned producers, Crumptons.
However, he has been witness to an industry that has been in decline for a number of years and said he foresaw less peanut farming happening in the region.
“ … It’s iconic to our part of the world through the peanut silos and being based here, and they’ve been the centre point of Kingaroy for many years,” he said.
Mrs Duff said it would be a “massive blow” if the facility closed permanently but assured residents the silos would always remain part of the Kingaroy skyline.
“The silos, because they’re heritage listed, they will always remain and they’ll be looked after because they’re under that umbrella of the heritage list,” she said.
“But it’ll certainly be a massive blow for our region to have PCA and the peanut factory not operating.
“That would be just such a blow for our region and I’m hopeful that something will come out of the announcement.”
Mrs Duff and South Burnett Regional Council CEO Mark Pitt met with Bega Group representatives on Thursday morning, and she said they were hopeful a buyer would come forward.
Attorney General and Nanango LNP MP Deb Frecklington said she was optimistic that peanut processing in the South Burnett would continue into the future.
“My thoughts are with the staff and growers affected by this challenging situation,” she said.
“In relation to the very important peanut industry within the South Burnett, it is a priority for both the Minister for Primary Industries and myself.”
Mr Bjelke-Petersen expressed cautious optimism about the future of the iconic peanut factory but believes government involvement is needed to address the challenges the agricultural industry, not just peanut growers, are facing in the modern day.
“Hopefully there is a buyer out there that sees a future and sees a way in which they can move forward,” he said.
“But I think governments need to be a part of this review of where they’ve taken our industry and the pressures they’ve put on us.”
What you said
Debbie
“Such a shame. Unlike the big cities, little country towns have no options for the employment of so many people. Times are tough enough as it is and these people and their families are going to struggle through no fault of their own. Tough times ahead.”
Peter
“So what peanuts are they sourcing? And where will my peanuts for my peanut butter come from? Could be the end of Bega peanut butter. Not eating Chinese stuff. This happened to Golden Circle pineapple slices, ect. All the farms that supplied the pineapples stopped growing them and now our canned pineapple comes from Philippines and China. I don’t buy their products anymore.”
Simon
“No longer the ‘peanut capital’, I guess”
Chris
“It’s hard enough already to source raw ‘redcoat’ peanuts with their hard shells removed. Woolworths, Coles and Aldi don’t stock them and at present I can only obtain them from IGA and some independent outlets. They are a healthy snack, so it will be a huge disappointment if they become even more difficult to obtain in the wake of this news.”
Nicole
“Half of Kingaroy has worked there at some point, they’ve been running at a loss for years sad it’s come to this.”
Cassandra
“This is a very low blow, we are famous for our peanuts and pigs..... and now we are losing one of the very markers that put us on the map. We are also now having families with no jobs and even less jobs available in the South Burnett region. Is there a way we can protest the decision or at least have our voices heard as to how damaging this will be for the South Burnett as a whole?”
Entropy
“Australia’s problem for manufacturing is we have high wages, high energy costs and high regulatory costs. For food manufacture, we can probably get away with two of those, but not all three.”
Rod
“Very sad to hear this, the silos are an amazing landmark. I remember when they were all red from the Burnett red dust. ~1980s.”
Paul
“Why wouldn’t they, when you walk into these local supermarkets and the shelves are full of Chinese or Vietnamese peanuts? Supermarkets should be ashamed of themselves, can’t even support our local growers.”
Lesley
“Unfortunately declining tonnages, some years have been as low as 10000. Bad seasons – too much or too little rain – and farmers leaving the industry have all played apart in the downfall of tonnages. The site is old, replacement of machinery has lacked, just band aid solutions, meaning lack of improvement with production and processes. And finally all the experienced management have been either let go or have moved on. PCA hasn’t had the right people steering the company since Bob Hansen in my opinion. Sad for Kingaroy, sad for the industry.”
Shane
“It’s a real disappointment that foreign companies buy our companies and then shut them down all for a bigger profit. I hope that all the workers and their families will be okay and that Kingaroy will bounce back stronger than ever. Shame on you, Bega.”
Jack
“WHY aren’t Australians supporting AUSTRALIAN farmers and their products instead of CHEAP imported food? We have a peanut van here in my town and it always looks busy with tourists stopping to buy from them. I shopped at our local Woolworths yesterday and most of the Australian brand foods that I used to buy have now disappeared from the shelves … I buy Australian ALWAYS even though it is dearer.”
Bernadette
“It would be helpful to know what parts of the operation have contributed most to the closure. My guess is power and staffing costs making it less competitive than imports. Regardless, it’s an unwelcome loss. Another Australian enterprise hitting the wall. What will the flow-on be for local growers?”
Check out our gallery of photos from the peanut industry in the South Burnett
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