Chinese billionaire to sell Tassie dairies after Fonterra deal sours

Chinese billionaire Xianfeng Lu has put one of the country’s biggest dairy operations, the nearly 200-year-old Woolnorth farming aggregation in Tasmania, up for sale after losing a big milk supply contract with dairy giant Fonterra earlier this year.

At the time of his purchase from New Zealand’s Tasman Agriculture, VDL was the largest single supplier of milk in Australia, milking almost 18,000 cows and producing about 7.66 million kilograms of milk solids. The listing of Woolnorth comprises 9500ha of farmland including 4207ha of dairy area. That’s about half the size of the property – around 19,000ha – when Mr Lu’s Moon Lake Investments acquired VDL in 2016.Most of the downsizing occurred in 2021 when Van Dairy sold 11 dairy farms – around 2200ha in total – and 5000 cows for6000ha of farmland to Angus cattle breeder, the median price of a hectare of farmland in North West Tasmania was just under $26,000 in 2022.

The plan, which would have raised cash via a share sale and taken some pressure off Mr Lu’s debt-funded acquisition of VDL, was blocked by China’s sharemarket regulator.

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