GOOLMANGAR dairy farmer and Norco director Greg McNamara.
GOOLMANGAR dairy farmer and Norco director Greg McNamara. Jamie Brown

A 5th generation dairyfarmer with faith in future

AFTER five generations working the same soil in the shadow of the Mt Warning caldera, dairy producer and Norco director Greg McNamara understands how to keep a family farm enterprise on track.

"Bite your tongue," he advised. "Pick your battles. It is important that everyone tries to get along."

The same approach could be used in Norco's foray into China, where relationships and trust are more important than a notarised contract.

In the past 12 months Norco has found China to be a keen market, anxious to buy into the fact that our local co-operative has a successful lineage of 119 years of continuous trading and a membership base of family dairy farmers, much like the McNamara's.

But finding suitable partners in that country has not been a simple process and the co-op has learned much in the past year.

Mr McNamara explained that the difference in culture between Australia and China was something that needed to be understood before business could really forge ahead.

"It is an emerging economy," he says.

"But there is a lot of respect for the fact that they are doing in one generation what our forefathers did in five generations.

"That is enormous cultural change."

Key to Norco's ongoing success in China, and the rest of Asia, is maintaining its authentication.

With the reality that the Norco brand can be copied and its product literally watered-down, the co-op has taken the initiative and signed up with an online brand protection technology called AuthenticateIt - an app that provides consumers with a smartphone the ability to scan a code and find out when the milk was bottled and its use-by date.

As well, the app offers information about Norco and its history.

"We've seen the technology in use and it works," Mr McNamara said.

"Young mothers in China want the best food for their children and they check out the bottles with their smartphones."

For a small fee - one to two cents per bottle - the technology helps to stop counterfeiting.

"It is the sort of thing we had to put together to secure our brand and maintain our premium," he said.

On the domestic front, meanwhile, the current struggle to work under the $1 per litre price ceiling set by Coles and Woolworths continues to make life on the land almost prohibitive.

Having said that, Norco's contract with Coles has proven beneficial, particularly its contract to custom-supply Coles brand ice cream.

In fact, Coles funded the recent 3c a litre farm gate price rise for co-op members.

But the issue of fair funding for farmers is not yet resolved.

"It is a concern," Mr McNamara said.

"In the old days people struggled and continued but today if a farmer isn't making a dollar they will quit after a while.

"They don't need to be a slave to the land anymore. We have choices and our kids have choices."

Perhaps of greater concern is the fact that there is no legislation preventing retail shops from selling produce below the cost of production.

And in the current economic climate, which now allows Australia to sell dairy produce under reduced tariff to China and soon Korea and Japan, there may be more incentive to sell overseas than on the domestic market.

Certainly, Gina Rinehart intends to do just that with her mega dairy in the Mary Valley, which plans to make milk powder for the Chinese infant formula market.

"It will be a challenge," Mr McNamara said.

If the international market pays more for our product then that's where it will go and the $1/litre price war won't help the situation.

"Farmers' allegiance to the domestic retail sector will diminish the longer that program continues."

He sought to clarify his comments by noting that Norco's deal with Coles was not set on price.

"We are selling our heritage, our history, our quality and the region we live in," he said.

"The Chinese like that too. It's not just a product, it's the history.

"A consumer can buy the Norco product in China or Australia and they can be reassured that every hand that has touched it is an Australian hand from someone who cares about that product."

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