Synlait adds 28 more milk suppliers

By Jim Cornall

- Last updated on GMT

Synlait has added 28 more milk suppliers from the Canterbury region.
Synlait has added 28 more milk suppliers from the Canterbury region.

Related tags Milk Money Management

New Zealand company Synlait now has 201 milk suppliers for 2016/2017 to meet forecast growth in its value-added nutritional product business.

John Penno, managing director and CEO, said a combination of increased customer demand for nutritional products and increased production capacity with a new large scale spray dryer has created an opportunity for Canterbury dairy farmers to supply Synlait.

Penno said the response had been so positive that there was now a waiting list.

“Since we have been operating, only eight suppliers have left, four of which were the result of a change in farm ownership,”​ Penno said.

“We have one contract for all milk suppliers that is a rolling three year agreement, providing certainty to ourselves and our suppliers. Our relationships are sustainable because we’re all focused on making more from milk and offer everyone the same terms.”

Synlait’s Lead With Pride and Special Milk programs reward suppliers for differentiating their milk and creating value on farm through a premium payment in addition to Synlait’s milk price.

Penno said that while the premiums aren’t a solution to the current pricing pressures, they do help.

“We expect around $4m (NZ$6m) in premium payments will be made this season. More than 50% of our suppliers will receive a premium for creating value on their farm,”​ said Penno.

Related topics Markets Nutritionals Fresh Milk

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