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Prime Dairy celebrates dairy milestone with Woolnorth farm acquisition

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By InvestorDaily team
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2 minute read

Prime Dairy, a subsidiary of Melbourne-based fund manager Prime Value Asset Management, has reached a significant milestone with its acquisition of a 700-hectare “inside the gate” dairy farm at Woolnorth in north-west Tasmania.

This latest acquisition marks a key step in Prime Dairy’s strategic expansion in the region, which began in 2020 and has since seen a series of acquisitions.

Kirsti Keightley, general manager of dairy investments at Prime Dairy, said the latest purchase finalises the dairy assets for the Prime Value Dairy Trust, which closes to new investors on 30 June 2024.

“We have achieved what we set out to do in 2019, having built a dairy business across 5,000 hectares in north-west Tasmania and south-west Victoria, and have enough land to have reached our goal of 10,000 dairy cows.

“This latest ‘inside the gate’ purchase adds significantly to our Tasmanian holdings, which are some of the best dairy producing land in Australia.”

Prime Dairy solidified its presence in Tasmania with the acquisition of 11 “outside the gate” farms from Van Dairy in 2021. Substantial capital expenditure followed, resulting in a notable 35 per cent increase in dairy production over the past year.

Keightley noted that this investment is already yielding strong returns, with further growth anticipated.

“We now have the assets to grow more grass and to achieve more high-quality dairy production. There is enough support land to winter all our cows and to grow young stock. We have built huge new effluent dams and pivot irrigations and have significantly reduced the need for chemical fertilisers.”

Keightley also highlighted the favourable supply-demand dynamics in Australia’s dairy market, driven by domestic consumption and robust export demand.

“Australia has a growing population and needs 70–75 per cent of its dairy production just to meet local demand. There is also a strong export market for more quality dairy product.

“These dynamics, along with the Dairy Code of Conduct and the minimum dairy price are driving more growth and confidence across the industry”, Keightley said.

The Prime Value Dairy Trust targets a minimum 12 per cent return over the medium-to-long-term, offering quarterly distributions of 5–7 per cent. These returns are derived from a blend of income from milk sales and land value appreciation, reflecting Prime Dairy’s commitment to sustainable and profitable dairy investments.

Prime Value’s Kirsti Keightley will further elaborate on the compelling opportunity in dairy farming in an upcoming webcast on alternative investments, hosted by InvestorDaily.

To sign up for the free webinar, click here.