November 4, 2021

By Lynda Kiernan-Stone, Global AgInvesting Media

Chinese-owned Van Dairy has sold 6,000 hectares of its Woolnorth property in Tasmania to Australia’s TRT Pastoral Group for A$120 million (US$89.5 million), marking the first time the property has reverted back to Australian ownership in nearly 200 years. 

TRT Pastoral is a family-owned and operated agricultural company in business since 1994. Over the years it has built on its successes to consistently grow to have three major land holdings:

~North East Victorian Aggregation: Consisting of seven properties totaling 2,200 hectares (5,500 acres) on the Howqua and Delatite Rivers.

~King Island Aggregation: A large scale regenerative Angus cattle breeding and finishing operation consisting of eight properties (23,000 acres) in Tasmania carrying more than 9,000 breeders as well as progeny and bulls for a total of 20,000 head.  And,

~Woolnorth Aggregation: One of the oldest properties in Australia,  consisting of three properties totaling approximately 15,000 acres. Once fully stocked, this land is expected to carry 7,000 Angus breeders and have a carrying capacity of 100,000 DSE.

The Woolnorth land owned by Van Dairy had been owned by the British for approximately 170 years before being bought by a New Zealand owner in 1993, who later sold it to Chinese businessman Xianfeng Lu. 

TRT Pastoral already owns land in Victoria and in King Island, and plans to convert the land’s use from dairy farming to cattle production.

Van Dairy, which was formerly known as Moon Lake Investments, was the buyer of  Van Diemens’ Land (VDL) Company in 2016 for A$280 million (US$208.7 million), after much contention and push-back from Australian parties opposed to the foreign purchase.

When purchased five years ago, VDL was milking 17,890 cows and held 7,062 hectares across 25 farms, producing about 8 million kilograms of milk solids per year. In addition, the Tasmanian government granted the company approval to clear more than 1,800 additional hectares for expansion.

At the time, this deal was the first overseas transaction to be subject to new FIRB (Foreign Investment Review Board) conditions. Although granted approval, this deal is the first overseas transaction subject to new FIRB conditions holding Moon Lake responsible to comply with new Australian taxation codes requiring the company to advise the Australian Taxation Office (ATO) if it enters into any deals with non-residents. Such rules were recently enacted after pressure on the government to ensure that overseas companies are unable to transfer profits to offshore tax shelters in order to avoid paying Australian taxes.

This divestment of Woolnorth land is not the first divestment for Van Dairy amid a tumultuous year in which an audit found multiple problems with its effluent management and systems. In May, the company sold 12 farms totaling 2,200 hectares, carrying 5,000 cows for A$62.5 million to Melbourne-based boutique investment manager Prime Value.

Mr. Lu has stated that the proceeds from the sale of the Woolnorth land to TRT Pastoral have been earmarked for reinvestment into the remaining VDL farms, including plans to fund the construction of a packaging facility in Somerset. 

“My goal is to build a high-quality international dairy company, and I remain committed to this outcome,” said Lu.

For TRT Pastoral, plans for the Woolnorth aggregation (comprising three parcels) are to have 7,000 Angus breeders and a total carry capacity of 100,000 DSE once fully stocked. 

“It’s very productive country,” said Tim Roberts-Thomson of TRT Pastoral. “We think it’s ideal for our beef business. It complements the other two areas we have.”

– Lynda Kiernan-Stone is editor with GAI Media, and is managing editor and daily contributor for Global AgInvesting’s AgInvesting Weekly News and  Agtech Intel News, as well as HighQuest Group’s Oilseed & Grain News. She can be reached at lkiernan-stone@globalaginvesting.com.