Southland just can’t seem to get decent investment rolling :( I had been looking forward to a locally manufactured, plant based milk alternative.
Great South ‘supports’ decision to shift planned factory out of Southland
A follow-up story today, which doesn’t really offer much more than the following:
For the success of this greater vision, it is vital that our planned manufacturing base is in the location that allows easy connection and collaboration with industry and infrastructure.
I’m guessing things like packaging, flavouring etc., might be the “connection and collaboration” bits?
It seems they have decided to go with a bigger plant than originally planned so perhaps they need to be closer to Christchurch’s port. I do worry about how much water will be needed, Canterbury isn’t exactly known for an oversupply of water.
Oat milk production uses a lot less water than Cow milk production? (>1/10th) and won’t shitty up our rivers.
Perfectly good port at Bluff.
Instead, they want to grow Oats down here and then transport to CC for processing - yeah nah - makes little sense to me.
Oat milk production uses a lot less water than Cow milk production? (>1/10th) and won’t shitty up our rivers.
I’m not worried about oat milk instead of cow milk (that would be great), I’m worried about oat milk production on top of cow milk production.
Perfectly good port at Bluff.
There is a port at bluff. It handles significantly lower volumes than Christchurch and this may be a concern if they want to be world leading at oat milk.
Instead, they want to grow Oats down here and then transport to CC for processing - yeah nah - makes little sense to me.
It would use a lot less fuel to transport the oats than to transport the oat milk, if they still had to go to Christchurch.
It would be interesting to know what led to the decision. They originally planned the factory for Southland, so must not have been concerned about it at the start. I wonder if they came across political problems with councils or consent or something and decided it was too hard and to try somewhere else.
I’m not worried about oat milk instead of cow milk (that would be great), I’m worried about oat milk production on top of cow milk production.
In Southland, there are some areas in production now, but the idea was to do conversions of dairy as the industry grows.
There is a port at bluff. It handles significantly lower volumes than Christchurch and this may be a concern if they want to be world leading at oat milk.
Southland needs more income - growing the port would help achieve that?
It would use a lot less fuel to transport the oats than to transport the oat milk, if they still had to go to Christchurch.
Not if it is transported OS. And if it goes in my coffee it has to come back again as oat milk :(
If I hear the reasoning, I’ll post back here.
In Southland, there are some areas in production now, but the idea was to do conversions of dairy as the industry grows.
That would be great. Thinking about it, dairy and oat growing land probably share a lot in common so it makes sense to do that conversion.
Southland needs more income - growing the port would help achieve that?
This is the politics bit. The company wanting to set up an oat milk factory would look at what they need. They would approach the port to ask about this, the port would approach the council about expanding, the council may approach central government about support. Talks go round and round, but if they are going nowhere then they may end up going to a backup option like building the plant in Canterbury. It’s hard to know what made them change their mind, though if you’re local there may be rumours.
Not if it is transported OS.
The cost of shipping from Christchurch to Europe instead of Bluff to Europe is probably minimally different, but the cost of trucking from Southland to Christchurch port vs Canterbury to Christchurch port may well be a big difference (remembering one truck can take a tiny fraction of what a ship can, and each truck needs a driver, and each driver needs breaks if the trip is long). The shipping cost per litre may well be less than the cost to ship it to the other side of the world.
If I hear the reasoning, I’ll post back here.
That would be great, I’d be interested to know.
A detailed background story from 2021 for anyone interested.
Sorry, this link is probably paywalled:
Questions over oat milk plant relocation
No additional detail, but it is good to see the more ‘mainstream’ papers finally picking the story up.
Some key points/quotes from the article:
Southland leaders are still scratching their heads wondering how a 10-year Great South project to construct an oat milk plant in Southland will end up in Canterbury.
Some Invercargill leaders were calling for a full inquiry into the matter.
The company has yet to explain how it intends to offset the transport costs and increased carbon footprint associated with transporting oats from Southland to Canterbury.
The company being NZFF.
The Otago Daily Times has yet to receive a response to what supply contract conditions would be provided to Southland oat growers to ensure they would be competitive with Canterbury’s agriculture and grain market.
The Otago Daily Times understands NZFF was having discussions with global investors that had influenced the decision to move the plant to the Canterbury region.
Since the only two NZFF investors listed are Great South (49%) and The Warehouse (51%), does that mean that The Warehouse is dictating terms or that other investors are being brought in?
Great South chief executive Chami Abeysinghe said she thought it was important Southland got the “bigger picture”. “While we’re putting that disappointment aside, we need to continue to support this project,” she said. "And that means we bring new technology to New Zealand, we place New Zealand in a position of advantage as a leader on a global scale. “So, we’re proud that we’ve been able to bring that to us, to this country, even if it’s not within Southland.”
It is a shame that no one has bothered to present the “bigger picture” to Southlanders for them to “get”!!!
Personally, I think Great South and the Southland Councils really need to be taken to task over this - the ratepayers have/are funding this, so have an absolute right to know what is going on and how/why these decisions are being made. Unfortunately, this is what Southlanders have come to expect from their Councils, and it is not good enough.
Still no answers from Great South and some starting to question why?
Invercargill Councillor calls for ‘please explain’ from Great South
A couple of comments at the end of the article provide some idea of the feeling of locals about the ratepayer investments and potential conflict of interest surrounding the decisions being made.
I may have missed this originally, but it seems the company building the oat milk factory is 49% owned by the Southland councils? I’d also be pretty annoyed about putting all that work into it then losing out without explanation.
One step more complicated than that. The 4 southland councils (District and Regional) are 48% shareholders of Great South. Great South is 49% shareholder in New Zealand Functional Foods (NZFF) who are proposing to build the Oat Milk factory in Canterbury instead of north of Invercargill.
To make it even worse one of the Great South board members (the Chair) is also on the NZFF board and is not a Southland resident.
It appears to be a complete shit show, and no clear detail of why the decision to move the factory has yet been given.
The 4 southland councils (District and Regional) are 48% shareholders of Great South.
The article you linked in your comment above says:
The Invercargill City Council is a 48% shareholder in Great South
Which made me think the other councils would own the rest. I had a look on the companies office website, starting from the company we know the name of:
NZFF is owned 51% by K ONE W ONE and 49% by SOUTHLAND REGIONAL DEVELOPMENT AGENCY.
SOUTHLAND REGIONAL DEVELOPMENT AGENCY is owned 48.7% by Invercargill City Council, 48.7% Southland District Council, a bit over 2% by the Gore District Council, and a bunch of others making up the last 1%.
K ONE W ONE is owned almost entirely by Steven Tindall, founder of The Warehouse. It’s 90% owned by him, then the other 10% is owned split 4 ways including himself again, his wife, and what I presume to be two business partners.
It seems so odd to me to announce to the media you are not building in Invercargill but you haven’t decided where you are building. Was this some tantrum where they didn’t get the answer they wanted from someone so the board just decided screw it we can’t work with them and ran to the media about it? Given the councils own 49% of NZFF I would think they are well within their right to get an explanation for the decision, even if they can’t change it. After all, the directors have to do what is best for the shareholders by law, so they need to be able to prove their decision making process.
Yeah, my bad wording. Invercargill CC are 48.7% shareholders, Southland District Council are the same 48.7%, Gore District Council and Environment Southland (Regional Council) have less than 2% and a couple of Trusts with less than 1%.
Mayors of ICC and SDC have made noises of support of the move but haven’t justified it or made meaningfully comment.
Ratepayers, who provide significant funding to Great South each year have been left in the dark.
The recent Great South annual meeting, which the two major mayors were part of made no mention of Oats or Oat milk, at least on record.
As a ratepayer I’d at least expect to know the reason behind the move.
I hope you get some answers! At least this still drives demand for Southland oats, but if I was a rate payer I’d also want answers. Hell, I’m not a Southland rates payer and I still want answers!
This is the recent meeting I was referring to - not an annual meeting…:
Great South Joint Shareholders Committee Agenda
Great South have there fingers in a lot of pies which in theory should pay off for Southland, but Great South is relatively ‘new’ in its current form and much of what they ‘sell’, never seems to come to fruition. There is a fair amount of history in this organisation as it was previously known as “Venture Southland” with the “Southland Regional Development Strategy” (SoRDS).
They started of fairly small but seem to have grown exponentially with quite a large number of staff popping up on there website now. There are quite a few in the community who question if this organisation provides value for money? I’m still on the fence, but changes like the one outlined above with little detail and little to no input from the community who pays for the ‘service’ just feels wrong to me.
The article is from several days after the meeting, so I wonder if the next meeting will involve discussion of it? Great South may not have known about the decision until reading it in the media.
The saga continues, still with no reason for the move. Though there is some hinting that funding could be the reason?
Great South shareholder angst spills into article comments section
Unfortunately the complete lack of transparency in all facets of Council is a VERY common theme in the South.
There are those who are not happy with the decision
Great South, the Southland Regional Development Agency, is funded by the four district/regional councils, i.e. ratepayers, so there is good reason for not being happy about the support they are giving for the relocation. Great South appear to be very quiet around providing meaningful details for the support and the reasons for the move.
