Murray Goulburn to close Rochester plant

MURRAY Goulburn Co-operative has announced it will close its manufacturing facility at Rochester as part of a dramatic plan to slash costs.

The Rochester facility will start its staged closure in August in anticipation of it being shut down by the third quarter of financial year 2018.

Facilities at Victoria’s Kiewa  and Tasmania’s Edith Creek will also close, with about 360 employees to lose their jobs across the three sites.

► More than 100 people will lose their jobs at Rochester: “It’s not just the farmers, it’s the whole town,” Donna Sexton said. “We had heard talk for a long time. The hierarchy at Murray Goulburn didn’t value Rochester.”

► Koroit spared in MG's closures: Murray Goulburn’s Koroit plant, the company’s largest milk processing plant, has escaped the axe in the company’s urgent reaction to falling milk supply and profits.

► Young families who will lose their income stream when Murray Goulburn closes its Rochester plant: Carmen Moon said her husband, Stacey, worked at the dairy processing plant for about five years and his income supported their four children. It was their only way of paying off their two mortgages since Ms Moon gave away work to raise the children.

► Tasmanian Deputy Premier calls Murray Goulburn "appalling corporate citizen": Deputy Premier Jeremy Rockliff has described in Parliament the closure of the Murray Goulburn Edith Creek plant as “a real kick in the guts for the people of Circular Head”.

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In a statement to the Australian Stock Exchange, Murray Goulburn said: “These decisions are a continuation of efforts to address MG’s cost base, improve efficiencies and ultimately increase earnings and farmgate milk pricing.

“Once completed the closures are expected to deliver an annualised net financial benefit of $40 million to $50 million. MG anticipates a net financial benefit in FY18 from the closures of approximately $15 million.”

The decision comes as a result of Murray Goulburn’s asset and footprint review.

Chief executive Ari Mervis said it was a difficult outcome to reach.

“At MG we are acutely aware of the impact that our decisions will have on our various stakeholders, including the communities in which we operate,’’ he said.

“We are committed to ensuring that we provide our affected employees with appropriate levels of support and the recognition that they deserve during this period of transition.’’

Mr Mervis said the company would would provide career transition and redeployment services to employees.

He said it would also work with federal and relevant state governments to leverage existing programs.

“These have been difficult decisions to make, however they are necessary steps on the journey to ensure the future strength and competitiveness of Murray Goulburn,’’ he said.

“A strong MG is of fundamental importance to the Australian dairy industry and these decisions are necessary to lay the foundation for the future.” 

On Friday the Australian Competition and Consumer Commission said it would take the milk processor to court, a year after Murray Goulburn slashed farm gate milk prices and forced farmers to pay back money they had already received.