However, the co-operative said it hopes to leave a legacy for the area’s dairy industry by directing remaining funds into ongoing support to regional dairy education, extension and promotion activities.
The DemoDAIRY Board voted to start the winding-up process, which is now subject to shareholder approval, and meeting regulatory requirements may take several months.
Chairman Ian Teese said the decision to close the co-operative was disappointing but unavoidable.
No longer a priority
Over the past 18 months, there have been consultations with shareholders and industry stakeholders on the future of the DemoDAIRY facilities and dairy farm. The board concluded DemoDAIRY is no longer a high priority for regional dairy industry organizations and dairy farmers, and operating profitably had become challenging.
DemoDAIRY was established 20 years ago as an applied research and demonstration farm, but its role in the dairy industry has changed in recent years as on-farm research projects were phased down, and demonstration activities were largely replaced by focus farms.
Teese said DemoDAIRY had been unable to find a long-term anchor tenant for the dairy precinct, 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,” Teese said.
“We canvassed both within the industry at farmer and organizational level and potential external users but discussions with large industry organisations have been exhausted without a positive outcome.”
How to close a co-operative
The National Centre for Dairy Education will be able to continue use of part of the facility under its current lease arrangements.
“We are seeking legal advice regarding what is required by the Registrar of Cooperatives and the formal legislative requirements that are needed to close a cooperative,” Teese said.
“We are timing the decisions based on critical dates for the farming in the area and to maximize the value of land and buildings.”