Alliance Group's new deer facility part of cost-cutting strategy
A new state of the art deer processing facility will be built on the bones of an old beef processing plant.
Alliance Group announced last week it would transfer its venison operations from Makarewa to a new deer processing facility at its Lorneville plant, near Invercargill.
Alliance chief executive David Surveyor said the development, which had been assisted by the sale of land at Makarewa, confirmed the co-operative's commitment to the deer industry.
"This is a new, world-class facility that will result in a more than 30 per cent reduction in our deer processing costs."
The new facility also demonstrated that Alliance was delivering on its strategy to continue investing in the future, reduce costs and ensure world-class facilities, he said.
Surveyor did not expect any job losses from the move.
The new processing facility is expected to be operational for the new processing season in July with all deer processing set to continue at the nearby site at Makarewa in the meantime.
Alliance company secretary Danny Hailes said the processing plant at Makarewa had been operating since 1999, but with the sale of the land there was an opportunity to create a "state of the art" facility specifically for deer processing.
The new processing facility will be built on the area of the Lorneville plant which used to hold the beef processing plant. Processing of beef finished at Lorneville and refocused to the co-operative's Mataura site in 2000.
The new facility would be able to incorporate some of the gear from the Makarewa site into its new facility, but there would be an update to the current systems to make it into a more modern venison facility, Hailes said.
While the move had been on the cards for the while, it fit with Alliance's strategy to reduce operating costs and bring more value to farmers, he said.
"By incorporating it into an existing site nearby we'll just be better utilising over overhead."
The co-operative was "turning every stone" and looking for ways to cut costs, he said.
Employees were set to benefit from new equipment, and a modern facility, while the wider Southland deer industry would benefit from a commitment to the future of deer processing, he said.
"We are committing to deer processing in the south and we're prepared to put some money into this modern facility."
As part of the change Alliance has agreed to sell the farm at Makarewa to help establish the Southern Dairy Hub, a dairy and demonstration farm that will deliver significant benefit to the Southland region.
Construction of the new Lorneville facility was aimed to begin in about February. The Makarewa property will settle on November 1 when the conversion process will start.