Beleaguered Lion dairy secures exports to Hong Kong

Lion dairy and drinks company has signed a deal to distribute Australian brands into Hong Kong.

The partnership is with Vitasoy International Holdings, the company that produces soy milk drinks, and has manufacturing operations in Wodonga, northern Victoria.

Lion says its brands Farmers Union, Yoplait, Pura and South Cape Cheese will be marketed in Hong Kong.

In a statement, Lion says: "While our (Lion's) export business is currently small, this provides an exciting opportunity for Lion to start building its presence in a high-growth market."

No one from Japanese-owned Lion would talk about the deal, but it comes after losing the contract with Coles to supply generic milk. Lion has to find a market for 70 million litres of milk that are now excess..

Lion collects milk from more than 700 dairy farmers, through the Dairy Farmers Milk Co-operative.

Negotiations on the milk price are deadlocked and have gone into mediation.

The Dairy Farmers Milk Co-operative says the situation is volatile, with dairy farmers worried they will get charged extra to get their milk collected, the further away from Sydney they are.

Source: ABC Rural News, 8 July 2013