Lion media statement re Woolworths private label milk contracts

Lion Dairy & Drinks (Lion) is pleased to have retained the contract to supply Woolworths Ltd’s private label white milk in South Australia, Tasmania and the Northern Territory.  We are however disappointed with the outcome in Victoria and Western Australia, where Lion will cease supplying Woolworths’ private label white milk from February 2015 (Victoria) and July 2014 (WA).

We put forward our most competitive bid in each state, reflecting Lion’s commitment to grow the Australian dairy industry through fair pricing that ensures a sustainable future for the whole supply chain – including farmers and processors – and long term contract certainty that supports investment.

However, we fully respect that this is a decision for Woolworths, which remains an important customer and partner for Lion.

Woolworths’ decision will impact volumes at Lion’s milk processing plants in Chelsea (Victoria) and Bentley (WA).  We will work through the detailed implications of this with our teams over the coming weeks.

We will continue to work closely with all our customers to build value in white milk and other key categories, in line with our category and channel based strategy to grow value in our core segments.