Bega nutting out expansion plans
BY EARLY February, Bega Cheese will have completed its takeover of the Peanut Company of Australia.
When the ink on the deal is dry, the dairy giant will seek to expand the number of hectares under peanuts.
Bega Cheese owns 96 per cent of PCA shares, with the final four per cent to be bought in coming weeks.
There will also be a program of upgrades to the production facilities and workplace safety systems at PCA's Haly St factory.
A team of accountants and engineers have met with peanut growers and PCA staff this week to assess and plan for this expansion.
Steve Rae is Bega Cheese's head of strategy and planning.
He said Bega aimed to have 100 per cent of its peanut butter sourced from Australian peanuts.
"One of the strategic reasons why we looked at PCA is because consumers want to know more and more about where the product comes from," he said.
"You can pick up a jar of peanut butter and look at the back and say, 'Yep, it's made by Bega Cheese but where do those nuts come from?'
"We wanted to buy PCA to help consumers understand that connection, but also to support and increase in the proportion of our products that are supplied by Australia nuts."
The South Burnett peanuts will find their way into Bega's peanut butter, purchased by Bega Cheese in July.
The product is currently a combination of Australian and Argentinian nuts.
Given Kraft peanut butter is one of the biggest selling brands on the market, it will take some time before Bega can source the volume of nuts it needs to have 100 per cent Australian products.
"There's a really important change happening with labelling in this country with country of origin labelling on the back of packs," Mr Rae said.
These labels will say what percentage of a product is made from Australia and imported ingredients
"We probably can't get to 100 per cent Australian nuts straight away, but we want to work with growers here and our other regions to really increase size of the crop," Mr Rae said.
He said upgrades at the Haly St factory would help in meeting this goal.
"That's as much about safety and how we support farmers in terms of our drying capacity, and looking at the (PCA's) Picky Picky range," Mr Rae said.
The summer peanut season is under way and Mr Rae said the company would have to wait until next year to increase its crop.
He said it would take a while to source the equipment and finalise plans before any major work on the factory started.