MVM struggles
OPINION: Nearly four years after buying a 75% stake in Southland processor Mataura Valley Milk (MVM), A2 Milk is still struggling to take the plant to profitability.
Agriculture Minister Damien O’Connor formally opened the plant last week at a ceremony attended by staff, farmer shareholders, shareholders, suppliers, and central and local government representatives.
“The official opening is an opportunity to bring all our stakeholders together to celebrate what has been achieved,” May said.
The nutrition plant started production in August with a more low-key ribbon cutting ceremony.
MVM says the plant is part of a strategic plan to invest in the world’s most advanced production technology, people and systems, to deliver a broad range of world-class nutrition including food for babies and toddlers.
“Everyone is working together to achieve our vision to create high value nutritonal products and it’s taken a phenomenal effort, in excess of 900,000 hours, by a lot of people across a lot of sectors to get to where we are today,” May said.
MVM’s major shareholder is the China Animal Husbandry Group (CAHG), in partnership with New Zealand shareholders and Southland farmer shareholders. Farmer shareholders are represented on the MVM board.
May said MVM is a model of what can be achieved with a clear vision of creating tomorrow’s nutrition for a growing world.
“We believe we have struck the right balance to achieve a successful partnership model allowing all shareholders, including farmer shareholders, to invest in the global nutrition market, benefitting everyone involved.”
CAHG provided the large capital investment needed and access to key global markets, he said.
Feedback from MVM farmer shareholders has shown they are proud to be involved, are feeling engaged in the business, and are highly satisfied with progress as production gets underway, he said.
“It’s about delivering on your promises. We’re keeping our milk price above the competition, allowing our farmer shareholders to develop a culture of excellence that our nutritional customers can engage with.”
May said the plant is running at capacity, processing about 700,000 litres of milk a day. The first shipment of whole milk powder left in early November. Nutritional product trials will begin in mid December, with the first nutritional products likely to be leaving the plant in April.
MVM continued to field a lot of interest from farmers wanting to become farmer shareholders.
“Clearly as our nutritional volumes grow, then milk from our farmer shareholders will need to grow during the next two to three years,” May said.
