Australian milk processing needs rationalisation

Australian dairy company National Foods said on Friday that it is confident of growing its revenue and market share despite the rationalisation of the milk processing industry, IndustrySearch.com reports.

"Currently the company is continuing to perform well and taking into account seasonally higher milk costs, we anticipate that our operating performance during the second half of 2001/02 will be marginally ahead of the first half,"​ said managing director Max Ould.

His words follow the release of the company results. National Foods announced a net profit of A$25.1 million for the six months to 31 December 2001, a 12.5 per cent increase on the A$22.3 million of the previous corresponding period.

The dairy company maintained that the major challenge facing the Australian industry is still the rationalisation of the milk processing sector.

"The company anticipates that supermarket share of white milk sales will continue to grow and that house brand milk will continue to improve its share of the grocery white milk sector.However the company believes that current house brand pricing is unsustainable, "​Ould commented.

He added that softening international commodity prices will be reflected in downward pressure on milk costs next financial year.