Blue day as King Island Dairy owners Saputo launches strategic review, considers sell-off

The future of an iconic Tasmanian dairy’s range of high-end cheeses remains in limbo after Saputo announced a strategic review of its operations, indicating it could sell the operation.

The future of iconic Tasmanian cheesemaker King Island Dairy remains in limbo after Canadian owner Saputo launched a strategic review of operations. Photo: Stu Gibson/Tourism Tasmania.

The future of iconic Tasmanian cheesemaker King Island Dairy remains in limbo after Canadian owner Saputo launched a strategic review of operations, with the business facing possible sell off.

Wednesday’s announcement came as King Island Mayor Marcus Blackie warned consumers not to take the company for granted, calling on cheese lovers to vote with their feet at the supermarket to help ensure the company’s survival.

In a statement, Saputo Dairy Australia (SDA) said it would keep King Island Dairy running at regular capacity while it assessed possible “future scenarios” for the business.

“The review will consider a range of strategic, commercial, and financial alternatives, including a potential sale to a third party so the facility can continue to make its award-winning products for the long term,” the company said.

“Approximately 63 employees that work at the facility have been informed of the strategic review and site management will work closely with them throughout the process.”

Saputo president Leanne Cutts acknowledged King Island Dairy’s historic roots in the community, and indicated that selling the facility could be its best chance at ongoing success.

“We recognise the potential impact any decision may have on the King Island community, especially our employees and dairy farmers, and we are committed to thoughtfully considering all possible scenarios before any decisions are made,” Ms Cutts said.

The future of iconic Tasmanian cheesemaker King Island Dairy remains in limbo after Canadian owner Saputo launched a strategic review of operations. Photo: File

Mayor Blackie said he received a courtesy call from SDA on Wednesday morning, just minutes before dairy staff were made aware of the review decision.

The mayor, himself a former cheesemaker at the facility, said dwindling supplies of fresh milk on King Island was a major factor in the company’s thinking.

“The King Island Dairy company is family to us here,” Mr Blackie said.

“The brand is legendary, and everyone around Australia and around the world who loves cheese knows King Island Dairy is the best.

“King Island Dairy is a big part of our economy, and one of our largest employers.

“But there is not as much milk here on King Island as there used to be ... because a lot of dairy farmers made the decision to get out of dairy and go to beef.”

Mr Blackie said that while the outcome of SDA’s review could not be predicted, King Island’s isolation meant that logistical issues and associated costs had always been a business reality for the dairy.

But he insisted that the cheese-making operation had a bright future if it could maintain its loyal fan base, and called on consumers to “throw the company a lifeline.”

“I think the best chance King Island Dairy has to survive as a going concern is for Australians to be reminded what a fantastic cheese it is, and do themselves a favour and go and buy it again while we are still here,” Mr Blackie said.

“What I want to do as mayor is just remind everyone that this is a legendary Tasmanian brand, and once it’s gone, it’s gone.

“And we don’t want it to go, because it’s too important to us on King Island.”

Saputo Dairy Australia brands include Cheer, Cracker Barrel, Devondale, and Tasmanian Heritage.