Andrew Forrest’s grand plan for a China food deal will progress next week when the Business Council of Australia hosts a forum with industry representatives and state and federal farm ministers led by Barnaby Joyce.
The meeting in Sydney on Thursday will be hosted by BCA chief executive Jennifer Westacott and will include representatives from a wide range of agricultural sectors including grain, beef, dairy and wine.
The move comes as the local dairy industry is talking up growth despite a 40 per cent slump in milk powder processing over the past three months.
Forrest wants industry and government to co-ordinate a response to the extraordinary demand potential in China and other parts of Asia.
He argues that too often in the past the industry has been at war with itself rather than working to a unified plan to boost Australian development through more food exports to Asia.
Forrest comes to the table with extraordinary access to the top echelon in China and he has run his food plans past Chinese Premier Li Keqiang, who supports the concept.
The trick now is to get government and industry to back the plan, but this will take some work because some attendees contacted yesterday were going more out of curiosity than faith.
The meeting is timed well for Joyce, who next month is due to release his green paper on agriculture policy.
It also comes as dairy processors are talking up their future, with Fonterra Australia boss Judith Swales the latest in an interview with The Australian yesterday.
The New Zealand giant’s financial year closes on July 31 and Swales, while not commenting on financial performance, acknowledged she has work to do to lift Australian returns to more acceptable levels.
The slump in global powder prices comes at a bad time for both Murray Goulburn and Fonterra as they attempt to talk up local production which, at about 9.2 billion litres, is well down on records set in 2001 of closer to 11.2 billion litres.
The slump in prices is estimated to hit farm gate prices but not to the extent of the 40 per cent global slump that was due to increased supply from New Zealand, Europe and the US and stockpiling in China.
Farm gate prices hit a record $6.90 per kilogram of milk solid, or about 53c a litre, but are tipped to fall 70c this year if the global prices continue dropping.
The global fall also comes as Murray-Goulburn chief Gary Helou prepares to do a roadshow in September to spruik his financial capital raising plans.
Falling farm gate prices will not boost sentiment ahead of those talks.
For Swales it’s a matter of boosting production through more innovative products and leveraging the fact that five of the top seven dairy brands in Australia are Fonterra brands.
She ruled out any imminent move on Bega, saying she was happy with the 10 per cent stake and the commercial relationship with the company.Source: The Australian – Twiggy dreams of united agrarian front to feed China for 100 years
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