Huge flour miller eyes NZ shutdown

By JAMES GARDINER

Goodman Fielder, Australasia's largest flour miller, is considering closing its four New Zealand mills and importing all its flour from Australia.

Nearly 200 jobs in Auckland, Mt Maunganui, Palmerston North and Christchurch are at risk.

Such a move would mean downstream job losses in distribution and packaging, as well as servicing the mills.

Wheatgrowers in Canterbury, Manawatu and Wairarapa would also be hurt, and they say consumers concerned about genetic engineering of food could have cause for concern.

Although the company has denied conducting a feasibility study, Herald inquiries have discovered a secret "Project Jupiter" at the Goodman Fielder head office in New South Wales.

Project Jupiter involves a review of all milling, mixing and packing operations on both sides of the Tasman, with a view to cutting costs and prices. It was announced internally to senior managers late last month and is due to end in May.

Industry sources say Goodman Fielder's New Zealand mills, which operate under the Champion brandname, would be closed and dismantled rather than sold, to prevent a competitor reopening them.

Goodman Fielder New Zealand Milling and Baking head Colin Wise said it was not true such a study was being done - "Well, not that I'm aware of."

But documents obtained by the Herald list Mr Wise as part of Project Jupiter's steering committee.

Asked if such a study might be done in Australia without his knowledge, Mr Wise said: "Not that I'm aware of. Again, that's all that I can say.

"We've got studies going on ... on all assets. Quite generally that's happening, yep, but it would be news to me that we're talking about not having any flour mills."

The director of milling (NZ), Alan Buckner, later responded to the Herald inquiry by denying a study was being conducted. Mr Buckner is listed on the leaked documents as being on the project's consultative committee.

He said the four mills had a total of about 160 staff, but the figures obtained suggest the direct employee numbers are closer to 200, with 69 in Christchurch, 63 in Auckland, 35 in Palmerston North and 30 in Mt Maunganui.

Last Wednesday John St Julian, the New Zealand engineering manager, flew to Australia to spend a day with the project manager, John Gorringe, studying a trial unloading of flour out of bulk containers.

The Canterbury-based chairman of United Wheat Growers, Syd Worsfold, said about 200,000 tonnes of the 320,000 tonnes of wheat produced annually by New Zealand growers went into flour milling. About 95 per cent of that came from Canterbury and the rest from Manawatu and Wairarapa.

New Zealand also imports about 150,000 tonnes of wheat a year, mainly from Australia and North America, about 70,000 tonnes of it for flour milling.

Mr Worsfold said the aim of a strategic partnership that growers had with flour millers was to produce 80 per cent of the nation's milling requirements by 2002. Wheatgrowers could compete with and meet the specifications of imported grain, but could do little about imported flour.

"Anything that cuts down opportunities for wheat growers would be seen as disappointing. Once a mill closes, it's gone basically for ever."

He said growers had gone to some trouble to ensure their harvests were fully traceable for quality assurance and food safety reasons.

A Christchurch Ministry of Agriculture and Forestry policy analyst, Murray Doak, said news of possible mill closures would badly shock growers, who had been told by the companies that their quality was among the best in the world.

"There's been an element of trust there ... which will be totally undermined."

The general secretary of the Service and Food Workers Union, Darien Fenton, said staff at the Auckland mill in Fort St were in the middle of pay talks and had been given no indication that their jobs were at risk.