Nature One Dairy bolsters position in Australian dairy market with acquisition of Nepean River Dairy

AUSTRALIA – Australian-based dairy processor Nature One Dairy is set to expand its share of the Australian dairy market following the acquisition of Nepean River Dairy (NRD) Pty Ltd for A$25.5m (US$18.6m). 

Nepean River Dairy’s manufacturing capabilities include its facility in Sydney, which has the capacity to produce 60m liters of UHT per annum.

Production is expected to increase to more than 100m liters in capacity over the medium term to cater for increased domestic and offshore customer demand. 

Following the company’s acquisition, these manufacturing capabilities and the company’s product portfolio will be merged under the Nature One Dairy brand. 

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Nature One Dairy says the completion of the acquisition is a key step in its intent to progress an IPO and lodge a full-form prospectus by November 2021 to support an ASX listing.  

Nature One Dairy founder and CEO Nick Dimopoulos, said, “We’re thrilled to have finalized the acquisition of Nepean River Dairy. It’s a key acquisition for our business as we continue to maximize control of our supply chain from order to customer in both liquid and powder products.  

“We’re looking forward to formally welcoming the Nepean River Dairy team and ensuring the customers from both sides of the business are able to realize the benefits that the partnership has to offer.”

Australian milk production rises 

Meanwhile, Australian milk production is expected to increase by 1.1% to 9.0 billion liters in 2021–22 as favorable seasonal and financial conditions continue to provide a profitable operating environment for dairy farms.  

The Bureau of Meteorology’s September to November forecast is for a higher than 80% chance of exceeding median rainfall for southern and eastern Australia.  

This indicates that strong pasture growth over spring is likely, which will support milking yields and herd rebuilding efforts.  

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The forecast increase in milk production will mark the third consecutive year that production has either remained flat or risen. 

The Australian Bureau of Agricultural and Resource Economics (ABARES)  also anticipates milking cow herd numbers to increase slightly to 1.38 million head as good conditions lead to herd rebuilding, which will increase the number of cows per farm.  

However, ABARES notes that farm exits are limiting herd population expectations as some dairy farmers are taking the opportunity created by historically high beef and land prices to retire or transition onto smaller beef cattle farms for lifestyle reasons. 

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