North West dairy farmers will still be able to sustain themselves after Clover’s controversial decision to close the country’s largest cheese factory in the town of Lichtenburg. This is the belief of Fanie Ferreira, a dairy farmer and interim chief of the Milk Producers’ Organisation (MPO).
Clover relocated its production activities to Queensburgh in KwaZulu-Natal – a move that Ferreira says did not surprise North West dairy farmers.
Ferreira tells Food For Mzansi that the MPO spoke to a number of farmers who supplied milk to Clover.
They indicated that there would be “no real impact” on them because Clover’s decision has been coming for “almost two years”.
“Instead, the milk that was supplied to the Clover plant in North West will now be supplied to other plants mainly in Bloemfontein,” he says.
Ferreira indicates that Bloemfontein also has a Clover yoghurt facility where many North West farmers supply their milk.
“So, it has no effect on farmers and there is no farmer who will lose a contract or milk because this has been in planning for a very long time.”
Did Clover make the right move?
Ferreira reveals that North West farmers already couldn’t keep up with the demand of the Clover plant there as it required about 35 000 litres of milk a day.
They could only supply it with approximately 100 litres per day. Thus, it still needed to drive in huge amounts of milk from KwaZulu-Natal, which justifies their decision to move.
Meanwhile Bertus van Heerden, chief economist of the MPO, believes some farmers might be affected because they will have to find alternative buyers that are further away from the province.
“That would obviously create additional transport costs for them which will cause the farm gate price to be lower than it was when the milk only had to be transported in a shorter distance,” he says.
A long time coming
He indicates that Clover’s decision to move has been in the planning for approximately 18 months.
“Clover struggled with service delivery issues regarding electricity and water and all of that culminated into them moving down to Queensburgh in KwaZulu-Natal.
“But they have been communicating with the farmers all along for the past 18 months, or so. In the process, the farmers identified a local market, and they also identified other buyers that are interested.”
Van Heerden opines that many of the farmers have found or should have been able to find new buyers. However, their milk prices will be determined by the distance that their milk must travel.
Philip Swart, manager of producer services of the MPO, says some of the dairy farmers in North West now supply their milk to Dairy Farmers of South Africa (DFSA).
This is the largest collector of raw milk in South Africa. It is also the raw milk supplier of premium brands such as Clover.