WARRNAMBOOL Cheese and Butter has entered into an exclusive agreement to supply premium milk powders to Japanese multi-national Mitsubishi Corporation but is tight-lipped about the value of the deal.
WCB chief executive officer David Lord said his company was delighted to formalise even closer ties with Mitsubishi Corporation.
He said he could not put a number on what the deal was worth, nor say the volume of milk powder which will be supplied to Mitsubishi. “I can’t disclose the volume but we do expect the volume to grow,” he said.
“WCB has enjoyed a mutually beneficial supply relationship with the Mitsubishi Corporation over the years and we are pleased to continue our association through this agreement.
“This latest agreement is a direct result of our decision this year to upgrade our skim milk powder drier to enable the production of higher specification powders, and reflects our stated strategy of targeting premium dairy products and customer specific applications.”
Yesterday’s major contract announcement comes less than two weeks after WCB announced an expected $20 million slide in profits.
The strong Australian dollar, low commodities prices and competition for milk supply were blamed in the announcement to the Australia Stock Exchange on November 5.
Yesterday’s announcement revealed the agreement with Mitsubishi Corporation was for three years with provision to extend for further terms.
The specialised premium milk powders provided under the agreement will be used in the manufacture of high-quality milk-based beverages and other dairy products for the Japanese market.
The supply agreement came into effect on November 12 and includes exclusivity commitments by WCB, and annual volume and marketing commitments by Mitsubishi Corporation.
Yoshitaka Fujimoto, the general manager for Mitsubishi Corporation of the dairy foods unit within the Foods (Product) division, said the two companies shared a commitment to providing high quality products to consumers around the world.
“We look forward to working with WCB in this capacity, and providing high quality, safe and nutritious milk products to our customers in Japan,” Mr Fujimoto said.