DemoDAIRY starts wind up process

The DemoDairy near Terang.
The DemoDairy near Terang.

DemoDAIRY at Terang will start the process of winding up the cooperative after exhausting all options to remain open.

However, the Terang-based cooperative that owns the demonstration farm hopes to leave a lasting legacy for the south-west Victorian dairy industry by directing remaining funds into ongoing support to regional dairy education, extension and promotion activities.

The DemoDAIRY board has voted to start the process of winding up the cooperative, which will take several months to meet regulatory requirements.

Board chairman Ian Teese said the decision to close the cooperative was very disappointing but unavoidable.

The decision had been made after assessing the best way forward while trying to remain financially viable and contributing to the south-west dairy industry, Mr Teese said.

During the past 18 months, there have been extensive consultations with shareholders and Industry stakeholders on the future of the DemoDAIRY facilities and dairy farm.

The board said it had found DemoDAIRY was no longer a high priority for regional dairy industry organisations and dairy farmers, and was becoming more challenging to operate profitably.

It had also been difficult to attract new board members when sitting members retired.

“We have exhausted all possible options to ensure a long-term future for the cooperative,” Mr Teese said. 

“We’re reducing the farmer and industry equity in the cooperative and have made the decision to start the process to wind up the DemoDAIRY cooperative,” he said.

DemoDAIRY was established 20 years ago as an applied research and demonstration farm but its role in the dairy industry has changed substantially in recent years as on-farm research projects were phased down, and demonstration activities were largely replaced by focus farms.

It comprises 160 hectares of land and had a 240 cow dairy herd.

Milk production from the farm has ceased. Mr Teese said the farm’s herd had been sold in the past week to a buyer who had a number of properties, including some in the south-west.

He said the decision on what would happen to the land would be made by the cooperative’s shareholders.

Mr Teese said DemoDAIRY had been unable to find a long-term anchor tenant for the dairy precinct, which was vacated about three years ago by WestVic Dairy, to support the National Centre for Dairy Education as a precinct tenant.

“A major anchor tenant is essential to the visibility and viability of the precinct and to contribute to the ongoing building maintenance costs,” he said. 

“We canvassed both within the industry at farmer and organisational level and potential external users but discussions with large industry organisations have been exhausted without a positive outcome,” Mr Teese said.

The National Centre for Dairy Education will be able to continue use of part of the facility under its current lease arrangements.

Mr Teese said while the decision to start the process to wind up the cooperative had been made, shareholders would have the final vote on approving the change after special shareholder meetings to update and inform members.

Details of DemoDAIRY shareholder meetings as part of the cooperative winding-up process will be announced at a later date.