Government Stepped In To Modernise Dairy Industry: Reddy

The Rewa Co-operative Dairy Company Limited (RCDCL) had suffered mismanagement, weak governance, inefficiencies, outdated infrastructure and technology, hence its restructure then.

Highlighting this in Parliament yesterday, Minister for Agriculture, Rural and Maritime Development, Waterways and Environment, Mahendra Reddy said; “In the end, Rewa Diary had accumulated considerable debts and, in the years, leading to 2010, it was facing a financial collapse.

“Simply put the business model for Rewa Diary, one that has been operating for decades - in today’s rapidly globalised world was no longer viable.

“Its financial losses were such that if was left unchecked to threaten the future of Fiji’s dairy farmers and industry,” he said.

The process of the restructure was the culmination of a long process and was timely.

“Government had to step in to revitalise and modernise the dairy industry,” Mr Reddy said.

He added that the restructure had few objectives including:

• Separating the processing function from the supply: This enabled specialisation and concentration of resources in essential components of the dairy supply chain.
• Strengthening the services provided to farmers: The creation of Rewa Dairy was about providing dedicated services to farmers including milk collection, subsidisation of farm inputs such as supplement feed, farm advisory services and financial support.

Mr Reddy said the restructuring process was not only about taking responsibility and driving concerted actions in a troubled business but it was also about providing opportunities for farmers to be better served.

“Any reform process takes time. There are risks along the way, but we must remain firm on the long-term goal,” he added.

Edited by Selita Bolanavanua

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