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House of Assembly - Fifty-Fifth Parliament, First Session (55-1)
2024-09-26 Daily Xml
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Beston Global Food Company

The Hon. V.A. TARZIA (Hartley—Leader of the Opposition) (14:54): My question is to the Premier. Is the Premier taking action to assist the employees of Beston Global Food Company. If so, what action? With your leave, sir, and that of the house, I will explain.

Leave granted.

The Hon. V.A. TARZIA: It has been reported that the Beston Global Food Company has gone into administration and over 150 local jobs are on the line.

The Hon. S.C. MULLIGHAN (Lee—Treasurer, Minister for Defence and Space Industries) (14:55): I thank the leader for his question. I did, aside from the leader, particularly want to thank the members for Hammond and Finniss, because they have been in contact with me in recent weeks to highlight the challenging circumstances in particular that dairy producers have found themselves in, as a result of the trading difficulties that Beston has found itself in.

Everyone in this place would be familiar with the tribulations that our dairy producers have been in over the last 10 years, in particular from difficult conditions caused by weather or market demands or by the pricing which is paid to them by people who buy their milk. I would like to think that as a country we have made some progress in shining some light on those difficulties, but by no means have we made sure that our dairy producers are being treated as well as they could be.

It is in that context, I think, that the member for Finniss in particular—who used to be the primary representative, I think the President, of the South Australian Dairyfarmers' Association, if I have got that title correct—as well as the member for Hammond, raised this with me. What they were concerned about was that there was a period of time in recent months when Beston was late in making payments for the milk that they were taking from dairy producers, which is of very great concern to the government, as it should be generally to the community.

Yes, we are absolutely concerned about the future in store for the workers directly employed by Beston, but I also think we need to be acutely aware of the circumstances that dairy farmers find themselves in as a result. I received not only the notice to the stock market that was made on Monday, on the 23rd, that Beston was going into voluntary administration, but I also received on the same day a letter from the chair, Roger Sexton, who would be known to many people in this chamber.

Beston, of course, is not a particularly longstanding company, but a company that has raised a significant amount of capital to invest in new plant and equipment. Two of their major products are lactoferrin, which I understand is of great use and interest in pharmaceutical and other purposes, and cheese, in particular mozzarella.

The concerns that Beston have had are that the dairy prices they have been paying here in Australia, while good for our dairy farmers, they say are out of step with what global milk prices are—I think it is a matter for other people's judgement to see if that is a reasonable criticism to be making—as well as other high operating costs, but in particular while the lactoferrin side of the business has been productive and profitable the same cannot be said for mozzarella.

The company has now gone into voluntary administration. I have asked the South Australian Government Financing Authority to make contact with the administrator—which, off the top of my head, I think is KPMG—to see what the circumstances are, whether the business will continue trading during the administration and what efforts will be made to sell the company. Of course, they were trying to sell it to a Japanese firm, Megmilk, which was looking very likely until it didn't eventuate, which caused them tip to in to administration. I expect to be able to say more to the house in coming days and weeks.

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