Farm Pride Food to begin restocking after avian influenza outbreaks

Agriculture Victoria has given the all clear to the ASX-listed egg producer to begin restocking its two farms struck by avian influenza last year.

Farm Pride Foods has informed the stock market it will begin restocking after two of its Victorian farms were decimated by outbreaks of avian influenza last year. Picture: Chloe Smith

EGG producer Farm Pride Foods is on the cusp of a turnaround following the $3.1 million sale of a Queensland farm and the restocking of two of its Victorian farms decimated by avian influenza last year.

Agriculture Victoria has issued a long-awaited green-light for Farm Pride Foods to begin restocking its two farms in the Lethbridge area southwest of Melbourne that were struck by two outbreaks of bird flu in August last year.

The outbreaks cost the Australian Securities Exchange-listed company between $18 million and $23 million in lost revenue and forced the culling of 380,000 hens.

“As a result, our restocking program for those two farms will now be commended as quickly as possible to allow a full return to production with a particular focus on cage-free and free-range egg production,” the company said.

The avian influenza outbreak prompted a company-wide strategic review of the business to hasten a return to profit. Years of high feed prices and tight supply from third party suppliers led it to record its second loss in as many years for the 2019-20 financial year of $2.17 million.

The review led to the view its Pittsworth farm in Queensland was “no longer a core asset” and was therefore listed for sale late last year through an expressions of interest process.

An unconditional contract has been struck with Hall and McLean, owners of Queensland’s Sunny Queen egg brand, to buy the farm and associated assets. Settlement is expected by mid-March this year and funds raised will be directed to support business development, drive down debt and capital expenditure.

The company will hold its annual general meeting on Monday.

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