Organic Dairy Farmers of Australia placed in administration, impact unclear on Corio Bay Dairy Group
Organic Dairy Farmers of Australia Limited has been placed in voluntary administration, with the administrators working towards selling the company.
UPDATE: ORGANIC Dairy Farmers of Australia Limited has been placed in voluntary administration.
Ivan Glavas and Scott Andersen, of Worrells Solvency and Forensic Accountants, were appointed administrators of the North Geelong business last Friday.
ODFA is owned by about 50 organic dairy farmers across Victoria and Tasmania.
They have the largest pool of organic milk in Australia.
ODFA owned a former fish processing plant in North Geelong, converting it into a milk receival and processing factory in 2015 to produce its True Organic brand of dairy products.
The plant had a hand-crafted cheese-making enterprise on the property.
ODFA also had a half share in the Corio Bay Dairy Group, a joint venture with Wattle Health Australia — which held a 45 per cent stake — and Niche Dairy Pty Ltd, with the remaining 5 per cent.
Corio Bay Dairy Group is building a spray dryer plant next-door to ODFA’s North Geelong operation.
The administrators said the business had a strong focus on exports to China.
They said a contracting Chinese market, delayed sales and the impact of COVID-19 had prompted the ODFA board to appoint Worrells to work through the current business challenges.
Mr Andersen said the administrators were working towards a sale but a deed of company arrangement was possible.
Milk pick-up from farms would continue as normal, with all ODFA operations and employees also continuing.
“Unfortunately, the current circumstances of voluntary administration is going to have financial ramifications on many stakeholders,” he told The Weekly Times.
“Through the trading that will continue, we will be trying to minimise financial and other impacts on all with the view to restructure Organic Dairy Farmers of Australia or selling its business or whatever viable proposition provides for the best return to creditors.”
It is unclear what impact ODFA’s financial troubles would have on the Corio Bay Dairy Group’s spray dryer.
Earlier this year, it was struggling to complete the plant, with sources saying a shortage of funding was an issue.
Wattle Health Australia recently secured $20 million from Shepparton Partners Collective to held fund the completion of the spray dryer plant.
WHA has remained in a trading halt since the end of September after attempting to raise funds to buy the Blend and Pack packing plant in Melbourne to control its supply chain and for general working capital.
The Blend and Pack deal fell over, but WHA found a white night in Shepparton Partners Collective to continue other operations.
Mr Andersen said he was still looking into ODFA’s relationship with the Corio Bay Dairy Group and what impact their administration would have on it.
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