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One of our directors, Adrian Rowley, is also a director of Australian Dairy Farms (ADF), a business that currently owns two dairy farms in South West Victoria. Adrian has been working in a corporate advisory capacity for the firm with the goal of raising $14.5 million, purchasing an additional 14 properties and listing on the ASX. If successful, this would enable ADF to achieve consolidation and scale in a domestic industry that is currently highly fragmented and where pasture land is often under-utilised. This inefficiency is highlighted by the fact that over the past decade Australian production of milk has fallen by 20 per cent (and farm prices along with it) against a backdrop where worldwide demand for dairy products has soared exponentially. ADF aims to become Australia’s biggest milk producer and this in turn will give them greater influence with processors during contract negotiations.
Last week Adrian was interviewed by The Australian Financial Review and his comments and the associated article on ADF was in yesterday’s edition (scanned copy attached). ADF plans to give investors two types of returns – earnings from its dairy operations and exposure to rising farm prices off their cyclical lows.
If you would like further information with respect to the investment please do not hesitate to call our offices or send us an email.