What Would Synlait Be Worth to Fonterra or a2 Milk?
Speculation of a possible joint move by Fonterra and a2 Milk to buy Synlait raises a much bigger strategic question, says agribusiness expert Dr Nic Lees.
Mark Leslie, director New Zealand manufacturing, says the decision to close the site has not been made lightly.
"While it is difficult for the people involved, we have a responsibility to our farmer shareholders and unit holders, and our customers to be as efficient as possible across our business, especially given the low milk price," says Leslie.
Kaikoura's cheese volumes will be split between Fonterra's Lichfield, Clandeboye, Stirling and Whareroa cheese plants, where cheese production is up to 16 percent more cost effective than at Kaikoura.
Leslie says the co-op has a long history in Kaikoura and staff and farmers feel a strong connection with the site.
"We are conscious that this is a difficult time for some local farmers, staff and their families, and the wider Kaikoura community. We are doing what we can to support them through this change," he says.
"Based on consultation, around half of the site staff have indicated their interest in redeployment elsewhere in the co-operative, and we are confident we will be able to meet their wishes.
"While we obviously would prefer to retain all of our staff, for those who are interested in moving on we will be providing assistance in their search for new roles outside of the business," says Leslie.
The final day for processing at the site is expected in mid to late April.
