Chinese billionaire sells Tassie dairy farms

A Victorian dairy fund manager has secured 700ha of historic northwest Tasmanian farmland, acquiring it from controversial owners.

A Victorian dairy fund manager has secured 700ha of historic northwest Tasmanian farmland, in a deal understood to be worth eight-figures.

Prime Dairy, the dairy farming arm of Melbourne-based fund manager Prime Value Asset

Management, has agreed to a reported $15 million deal with the Chinese-backed operator Van Dairy Group, acquiring a portion of its famed Woolnorth aggregation.

The transaction is the second time Prime Value Asset Management has secured assets from the Van Dairy Group, after paying $62.5 million for 11 properties, which included 5000 cows and 2200 hectares of land at Circular Head in 2021.

Three years on, Prime Value Asset Management now owns a 5000ha dairy portfolio across northwest Tasmania and southwest Victoria - enough land for its goal of 10,000 dairy cows, according to Prime Dairy general manager dairy investments Kirsti Keightley.

“This latest ‘inside the gate’ purchase adds significantly to our Tasmanian holdings, which

are some of the best dairy producing land in Australia,” she said.

Prime Dairy general manager dairy investments Kirsti Keightley. Picture: Supplied

“We’re now seeing the rewards from significant investment in the region, which we first commenced in 2020 and ramped up in 2021.

“Our dairy production was up 35 per cent over the last year, which will improve profits, and we expect significant further growth to come.

“Australia has a growing population and needs 70-75 per cent of its dairy production

just to meet local demand. There is also a strong export market for more quality dairy

product.

“These dynamics, along with the Dairy Code of Conduct and the minimum dairy price are

driving more growth and confidence across the industry.”

Prime Dairy has purchased 700ha of farmland, inside the Woolnorth aggregation in northwest Tasmanian.

The Woolnorth farmland is understood to be the final asset in Prime Dairy’s $230 million unlisted fund, which aims to deliver medium to long-term returns of more than 12 per cent.

Van Dairy, owned by Chinese billionaire Xianfeng Lu, bought 25 dairy farms in 2016 for $280 million from the Van Diemens Land Company, one of Australia’s biggest and oldest dairy farming businesses.

In its almost 200-year history, Woolnorth had only ever been owned by offshore parties, from the UK, New Zealand and China - but in November 2021 TRT Pastoral paid more than $120 million for a 6000ha slice of the historic aggregation.

At the time, Xianfeng Lu retained a 10,000ha portion of the Woolnorth aggregation.

Earlier this year, Van Dairy lost a 25-million-litre milk contract with Fonterra, with supply ceasing from February 1.