Gary Helou, chief executive of Murray Goulburn predicts that the number of major dairy processors in Australia will contract to half of the current eight which includes Lion, Fonterra, Saputo, Parmalat, Danone, and Bega within the next three years. Australian dairy production has shrunk from 12 billion liters per year to 9 billion liters per year and Mr. Helou states that there is simply not enough of a profit pool currently to support the number of processors. Mr. Helou adds that Australian processors are too focused upon the domestic market and a shift in focus is needed to China’s powdered milk market which has not yet peaked. Murray Goulburn plans to invest approximately $500 million over the next three years to increase production of milk powders, cheese and “better for you” dairy drinks.
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