WA dairy partners with Rinehart

31 Dec, 2014 01:00 AM
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Suzanne (left) and Mathew Daubney, Bannister Downs, with Gina Rinehart on the Daubney's Northcliffe dairy property.
Farming in Australia is in my view part of this important future...
Suzanne (left) and Mathew Daubney, Bannister Downs, with Gina Rinehart on the Daubney's Northcliffe dairy property.

MINING magnate Gina Rinehart has taken her rapidly expanding interests in agriculture one step further adding a joint venture with WA's Bannister Downs Dairy to her portfolio.

The unison between the two WA family-owned companies, Northcliffe dairy farmers Mathew and Suzanne Daubney's Bannister Downs Dairy and Ms Rinehart's Hancock Prospecting Pty Ltd (HPPL) subsidiary Hope Downs Dairy will centre on construction of a $20 million purpose-built processing facility enabling a four-fold increase in Bannister Downs' supply.

It will also include a tourism side to the business whereby visitors can share in the Bannister Downs story and see the process from "grass to glass".

Ms Rinehart said the investment was part of a developed strategy to support and grow the dairy industry in Australia.

It comes on the back of a Queensland-based joint venture with Chinese interests to supply infant milk formula to China.

Having spent much of her childhood in the North West, predominantly on Mulga Downs station, Tom Price, Ms Rinehart said she was privileged to have been brought up in the country with an outback commonsense background.

"Fortunately from participating in the mining industry we are also now able to invest further in the agricultural area," she said.

"I am pro small business, the sector which is the largest individual employer in Australia and the engine for our future.

"Farming in Australia is in my view part of this important future but it (like other small business) is struggling with the burden of government regulation.

"I am backing Australia and its future, but governments both Federal and State need to do something too."

Ms Daubney said her family couldn't be happier with the partnership arrangement they had formed with Ms Rinehart, especially as it meant control remained in WA hands and WA family business hands at that.

"I think people underestimate her connection to agriculture," she said.

"It's a positive for agriculture to see a local investor with a long-term vision making such a noble investment.

"It's a signal dairy is on the move and we hope there are other flow-on effects for the industry but it does take time to see the benefit at the farmgate."

Bannister Downs' main focus will continue to be supply to WA markets but overseas markets are on the radar for the future.

"We already have 50 outlets in WA on our waiting list so that will be our first priority," Ms Daubney said.

"After that there is enormous potential to sell into Asian markets particularly with the falling dollar and the competitive cost of air freight into these regions.

"We are not looking for mass markets but for high value markets in offering product freshness and integrity.

"I think trust is the new currency in business and that's what we offer.

"What we milk from cows this morning can be on local shop shelves within a few hours and in Perth and potentially Asia by tomorrow morning."

When they started their milk retailing venture in 2005, the Daubneys broke new ground with unique biodegradable, flat pack packaging in their mission to be ethical suppliers of premium quality, whole and flavoured milk and cream.

"Getting a small business started in WA in the early days was tough and we didn't make any money for the first four years," Ms Daubney said.

"By 2011 we knew we could make it work and that's when it became apparent our only hope for significant growth would be through a joint venture partner."

The Daubneys enlisted an Eastern States consultant to develop a business plan, but a chance crossing of paths with people connected to Ms Rinehart put the ball in motion for the current scenario.

"In 2010 when I won the 40 under 40 business awards, I received a congratulatory email from Mrs Rinehart," Ms Daubney said.

"I was amazed someone as busy as her would take the time to write a personal note and we continued to correspond on an intermittent basis.

"I came to learn of her love of the North West and her passion for agriculture."

The pair eventually met in person in January 2013 at a dinner in Busselton attended by Ms Rinehart, her daughter Ginia and a long-time family friend Dave Garcia who had an interest in dairy, but it was not until September 2014 that serious business discussions began.

"I don't think they thought we would be looking for partners and they certainly weren't on our radar as someone who would be interested in our relatively small operation," Ms Daubney said.

But a visit to HPPL's office to provide some general dairy industry information led to a throw away comment about looking for a business partner and so began a very different conversation.

Ironically this was on the same day Bannister Downs Dairy products were awarded champion milk and champion flavoured milk at the 2014 IGA Perth Royal Show.

"We eventually signed up on the 12th of the 12th and the whole process has been a wonderful experience whereby we have been treated with the utmost respect and kindness, while still being very accountable," Ms Daubney said.

The Daubneys are currently running about 3500 dairy cows of varying ages and breeds including Friesians, Jerseys, Brown Swiss and Finnish Ayrshire and milking 1100 head morning and night.

They produce five million litres annually supplying about 3.5 per cent of WA's fresh milk market.

But their plans for expansion are aimed at running 4000 cattle and milking 3000 head twice a day.

Eighty per cent of their milk is supplied from their own dairy, with the remaining 20pc sourced from neighbours Brian and Julie Armstrong.

"You hear a lot about Tasmania being prime dairying country but Northcliffe, with its relatively even temperatures and year round spread of rainfall (1200mm per annum), has been identified as one of the best locations in Australia for dairying," Ms Daubney said.

Construction on the new "creamery" is expected to begin in September 2015 with completion scheduled for late 2016.

Local architects Bosske Construction are behind its design with help from "wise industry retirees" with processing equipment to be supplied by GEA including DeLaval milking systems.

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READER COMMENTS

Deregul8
31/12/2014 6:00:23 AM, on Farm Weekly

Congratulations to both Gina and the Daubneys. A fine example of a partnership made possible by free market enterprise, hard work and sharp business acumen. The grains sector waits patiently for the same sophisticated investors to form relationships with young, entrepreneurial grain growers looking to apply their smarts and hard work ethic. Great stuff!
Cut the red tape
31/12/2014 8:51:24 AM, on Farm Weekly

The government must listen to Mrs Rinehart. The government must cut the red tape. Regulations, licences, approvals and over governance in Australia has become a $250-billion dollar burden. Mining is the most regulated of all industries in Australia and regulations it estimated to be costing more than the industry provides. Regulations is hurting our small business. Mrs Rinehart has incredible passion and is assisting our economy with her constant investing into our country. There should be many more like her she has a heart of gold and is a remarkable human being. Happy New Year.
Beef man
31/12/2014 10:12:44 AM, on Farm Weekly

Good on you guys manjimup pemberton northcliffe were once big dairy producing areas we had our own milk processing creameries and produced powdered milk then all the farmers slowly got screwed then all the processing disappeared. briliant to see it making a come back. what a pity we didn't still have our processing infrastructure now we have to rely on a billionaire to get it going again.
Beef man
31/12/2014 10:18:08 AM, on Farm Weekly

If gina can see the industry potential and so can the Chinese why can't our govt. our govt is more interested in mining and not interested in our long term prosperity
Cut the red tape
31/12/2014 11:55:24 AM, on Farm Weekly

Despite some of the efforts on regulatory reform the burden associated with business regulation is rising. Regulations is costing small businesses it reduces investment opportunities and lowers productivity. Australian's are working harder and longer to comply to the rules created by our rule makers. Most of the red tape cuts mentioned by the government are non-business pursuits and will not increase economic growth. Mrs Rinehart is sending waves through Parl to make change and to cut the red tape it will increase competition. She is totally amazing and our govts hopeless.
Cut the red tape
31/12/2014 12:13:42 PM, on Farm Weekly

The governments have their eyes closed, they have a fear to make changes. The government should be increasing the standard of living not decreasing it. There is already so much taxes, regulations so on. The high costs of over regulations is affecting small business and related industries. The Govt should stop taking so much money and act as leaders and make changes. The costs are never ending, it is easy money for the govts but they have no future plans for our economy. Mrs Rinehart can see our economy's potential for the future. What would Australia do without her.
Jock Munro
1/01/2015 5:34:34 AM, on The Land

Yes Deregular and there is every possibility that Gina will end up with the lot and then she will sell out because she cannot make any money-and she might even sell out to the Chinese Government!
Goto
2/01/2015 1:55:48 PM, on Farm Weekly

The Chinese government is using gina and twiggy to get in through the back door. where is the transperancy?
Cut the red tape
3/01/2015 5:02:53 PM, on Farm Weekly

The problem with some of our govts they lack leadership to propose changes that will create a better nation. Mrs Rinehart is unqiue and has enormous knowledge in how our county can progress in a positive direction. The Government should cut red tape which will increase the standards of living. Let businesses get on with the job in creating more work for Australians instead of wasting time and money with regulations. Mrs Rinehart should be congratulated in speaking up and assisting businesses in our country. Well done. The government should take notice.
Howard Josephs
23/03/2015 12:44:51 AM, on Farm Weekly

Just returned from Perth but was unable to make it to the Downs Dairy in Nothcliffe. I met relations, on the cruise we took from Perth to Sydney, of Mathew and was anxious to inspect the dairy but time constraint prevented me from making the trip since we live in San Diego, ca. I grew up in Holland on a small dairy but my family had a 5000 cow holstein dairy in South Africa. FoR two years I supplied the heifers for the dairy, prior to returning to the states . WILL CERTAILY WANT TO SEE YOUR OPERTATION ON OUR NEXT TRIP TO pERTH WHERE MY COUSIN OPERATES A LARGE BILTONG BEEF OPERATION.

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