Quite some time ago...it was in an ASX announcement that the Fonterra debt was repaid and the same announcement or a subsequent one that ACM was going to be the logistics company for moving milk from farm to processing at CDC but also that they had anarrangement with ACM for flexibility of milk supply. What this has translated to is selling to ACM rather than buying from ACM in the case of a shortfall for processing.
It appears there has been a subtle switch from ACM supplying milk for processing to being a seller to ACM of our farm milk. One concern I have is we are selling milk into ACM from SWDF Pty Ltd and buying milk back from them through CDC Pty Ltd and this is creating a revenue leak and incurring costs that we cant see. Two guesses where the funds are flowing out to...
If we have a congested sales channel where product out of the processing plant isn't getting to market or isn't being sold in market then we have, yet again, another issue with the success of the current business structure.
It is a brainless approach to say the least and bleeds income but incurs greater cost. Not something shareholders should be too happy about...unlike the happy cows.
AHF Price at posting:
11.5¢ Sentiment: None Disclosure: Not Held
