Silver Fern Plans New Beef Plant

NEW ZEALAND - Silver Fern Farms has announced plans to build a new high-tech beef processing plant on its Te Aroha site, subject to final board and other approvals including union agreement.
calendar icon 20 April 2011
clock icon 3 minute read

At the same time, the company has said it is to buy Wallace Corporation’s meat processing plant at Waitoa.

Wallace Corporation will retain its rendering, tanning, farming and casualty stock collection business at Waitoa.

Silver Fern Farms’ Te Aroha plant was seriously damaged by fire in December 2010 and has been out of operation since then.

Silver Fern Farms Chief Executive, Keith Cooper, said that the company’s intention to rebuild the facility would be welcome news for the Te Aroha community.

“We have had enormous support from our suppliers and our staff in the Te Aroha area to rebuild a beef processing plant in the Waikato and we’re pleased to be able to give them confidence in the future with this decision.”

Mr Cooper said the company planned to make a significant investment in the new Te Aroha facility subject to obtaining the necessary approvals.

Designed in consultation with internationally recognised experts in process layout and ergonomics and incorporating the latest technologies, including sophisticated traceability and yield collection systems, the plant will reflect the company’s focus on plant economics and best practice processing.

Mr Cooper said the new design has been developed with eco-efficiency and sustainability in mind and will set a new industry benchmark in line with global customer requirements.

“At every opportunity we are reviewing the environmental footprint of our operations. Our focus is on improving environmental efficiency while reducing costs through better use of resources and reduction of waste. The new Te Aroha plant will use significantly less electricity and water per head and discharge less effluent per head processed.”

Once the green light is given the company expects construction to take approximately nine months.

Mr Cooper said that the opportunity to acquire Wallace Meats had emerged during the course of the company’s due diligence to identify the best solution to service farmer-suppliers’ needs in the broader Waikato area and at the same time contribute to industry aggregation.

“From Silver Fern Farms’ perspective the purchase makes total sense. It has been long recognised that industry rationalisation is required to ensure the sustainability of the red meat processing sector over the long term. Our plan of action demonstrates the ability of commercial entities to make commercial investment decisions with confidence in the sector.”

Wallace Corporation Chief Executive Graham Shortland said the company has been planning significant investments in environmental initiatives such as waste to energy and new infrastructure at its Waitoa site.

“We have well recognised expertise in tanning and rendering co-products and we have been planning capability expansion and further development in these areas to take advantage of new technologies and to be able to undertake forecast growth. The sale of the meat plant potentially brings these plans forward” he said.

There will be a two week handover period during which both companies will work closely together to ensure a smooth transition but Mr Cooper emphasised that Silver Fern Farms would be adopting a ‘business as usual’ approach. The company has employed the staff at Waitoa and will operate the plant on that same basis.

Mr Shortland said Wallace Corporation was pleased that Silver Fern Farms was able to make the commitment to staff that it had.

Mr Cooper also stressed that there would be essentially no change to the service the Wallace Corporation plant provides to its farmer-suppliers in the area.

“We’ll be ensuring that those farmers who currently supply the Waitoa plant will continue to be given priority in terms of processing space. We are focused on delivering them a high quality processing service under the Silver Fern Farms banner and look forward to their continued support of their local facility.”

“Both initiatives are very positive developments for the company and the local economies that each plant contributes to,” said Mr Cooper.

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