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New Zealand's biggest meat company Silver Fern Farms and Modena Investments (New Zealand) have formed a joint-venture company, Farm Brands, to buy, produce and market meal and tallow.
Modena is owned by Landmark (New Zealand), a domestic tallow trading company and Societa Azionaria Prodotti Industrali (SAPI), an Italian renderer with operations in Europe and commercial agreements in South America.
Silver Fern said Farm Brands would establish new rendering facilities for the production of meal and tallow.
New Zealand currently produces around 150,000 tonnes of meal and 120,000 tonnes of tallow annually, of which about 75 per cent and 90 per cent is exported respectively.
Budgeted sales by Farm Brands would initially be valued at about $70 million.
Silver Fern chief executive Keith Cooper said the agreement fitted with the company's strategy of improving processing efficiencies and marketing price gains.
This ensured added value to supplier partners and customers by way of joint-venture initiatives and becoming an international marketing company with specialist partners.
"As an international exporter, SAPI [is] an ideal partner, offering technology, processing and global marketing expertise," Cooper said.
"An initiative of this nature will ensure we make the most of market opportunities, while providing a vehicle to aggregate raw material volumes to consolidate marketing strategies."
Cooper said the joint venture would have no immediate impact on Silver Fern Farms' operational staffing requirements.
Hugh Spence, of Landmark, had been appointed chief executive officer of FBL and Richard Somerville, an independent director of Silver Fern Farms, as its chairman.
- NZPA
