Bulla head defends early opening

Bulla Dairy Foods CEO has no regrets, over early price opening

Dairy
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No regrets for Bulla Dairy Foods chief executive.

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RIGHT DECISION: Bulla Dairy Foods chief executive Allan Hood says he has no regrets in announcing the company's opening milk price in mid-April.

RIGHT DECISION: Bulla Dairy Foods chief executive Allan Hood says he has no regrets in announcing the company's opening milk price in mid-April.

Colac dairy processor Bulla Dairy Foods chief executive Allan Hood says he stands by the company's decision to offer its opening milk price, in mid-April.

Bulla came out well ahead of other processors, since increasing its milk price by 30 cents kilogram/Milk Solids in two step-ups.

It's now offering between $6.70kg/MS and $7.20kg/MS.

"There are no regrets with the timing of our opening price," Mr Hood said.

"We made a commitment we would open as early as possible - there are reasons for that as it gives our suppliers an indication of our minimum price."

He acknowledged there had been some criticism of the decision.

Read more:Dairy processors' milk price battle

Mr Hood said Bulla made plans in February and March, for the following 15 months.

"We also make the commitment to our suppliers we would continue to evaluate what the rest of the year looked like," he said.

"If that looks good, if we can pull things forward, or do things differently, it will be reflected in a stronger price, which is what we have done.

"We pulled some things forward, we have been able to capitalise on the strength of the market and lock in some sales positions within our ingredients segment earlier than planned."

He said Bulla had also forecast a stronger than anticipated recovery, post COVID-19.

"We have quite a strong food service business - back in February and March it was quite uncertain - now we see that recovery."

Mr Hood said there were very clear signs of confidence in the industry, as evidenced by farmgate competition.

"Our business is growing and we need to increase our milk supply," he said.

"There is a lot more demand for milk, there are a lot of new entrants - which has changed the competitive landscape - so we have to respond to all these things."

There were also domestic and international "growth opportunities" for Bulla.

"Our brands did fantastically well during COVID,"Mr Hood said.

"There were more Australians at home consuming our brands and research shows when consumer behaviour changes, it tends to stick.

New product development, for both domestic and international markets, was also planned.

"We didn't know a lot of this back in early April," he said.

"Agile is the word we are using at the moment, we are all going to have to work a bit harder and do things a bit differently."

The story Bulla head defends early opening first appeared on Stock & Land.

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