Fonterra gears up for million dollar Darnum shutdown

The company revealed it would open its 2020/21 price at $6.55 a kilogram milk solids, 5c/kg MS below its highest ever opening price.

It comes as Fonterra plans to close its eastern Victorian processing facility at Darnum for five weeks as it undergoes a multi-million-dollar planned maintenance shutdown involving more than 100 external contractors.

Fonterra's Darnum regional operations manager Andrew Nooy said the company's move to announce its milk price ahead of schedule showed its commitment to offering a competitive milk price.

"We want to attract other farmers to the business," Mr Nooy said in relation to the early announcement.

The company opened the doors to its West Gippsland factory, originally built in 1997 by Bonlac, last week during a tour of Victorian dairy operations for young farmers as part of its Proud to be a Dairy Farmer program.

The company employs 170 people at the facility which includes 110 operational staff and 40 truck drivers, equating to more than 40 per cent of Darnum's population.

Mr Nooy said 97pc of the facility's staff lived with 20 kilometres of the plant which specialises in manufacturing nutritional infant powders which can retail for as much as $10,000 a tonne on the export market.

"All our excess milk is going to our Stanhope factory where they're converting that into cheese-based products," he said.

"We're more profitable that way by not having to have excess milk on site to convert into a small profit margin product."

The facility processes about 270 million litres of milk each year and has the capacity to process up to 2.6 million litres each day if both dryers are in operation.

The milk to make the powders is collected from 155 Gippsland dairies.

About 75pc of the facility's product is destined for the overseas market, with China one of its biggest markets consuming about 30pc of the powder made on site.

Young Victorian dairy workers had the chance to take part in a new program aimed at educating the next generation of dairy leaders during a two-day workshop and tour which looked at different operating and financial structures within the industry.

The Proud to be a Dairy Farmer program gave 13 dairy farm employees a chance to visit farms and processing sites, and addressed the challenge of attracting, retaining and developing people in the sector.

Organised by Fonterra and its suppliers' council, the program used industry stalwarts who shared their knowledge about the commodity and spoke about topics including how to progress careers through to farm ownership and the importance of a good work-life balance.

More than half the participants were women.

One of participants, Naringal dairy farm worker Karli Pyke, 26, said the program gave her a good insight into the broader supply chain.

"Working on the land can be isolating but there are so many people involved in the industry that can support us and with mentoring," Ms Pyke said.

"I lost my grandmother recently who was also a dairy farmer and this seminar really helped reaffirm why I want to be in the industry... it gave me a great sense of accomplishment for the responsibility my boss (John Dalton) has given me."

She started working as a farm hand before she finished high school and has since completed three certificates in agriculture.

Her role involves primary calf rearing as well as a tractor work, milking and fencing.

Fonterra said the program was offered to employees of its suppliers, but said a review of the pilot program would determine if the processor would make it more widely accessible next year.