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50th Anniversary of Rewa Dairy

November 29, 2009       Rewa Dairy, Nabua

Mr Josefa Serulagilagi, Chairman of the Board;
Members of the Board;
Ratu Savenaca Seniloli, Chief Executive Officer, Rewa Cooperative Dairy Company;
Mr John Denver of Fonterra, New Zealand;
Members of the staff of the Rewa Cooperative Dairy Co Ltd;
Representatives of farmers from Waidewara, Serea, Vunidawa, Nabaitavo, Lutu;Waimaro (Flats);
Wainivesi, Deepwater, Waidalice, Lokuya, Naitutu, Burebasaga, Naitalasese, Muaniweni, Viria, Navuso School, Vakabalea (Navua);
Ladies and Gentlemen.

Good morning, Ni sa bula vinaka and Namaste.

 Firstly, I thank the Chief Executive Officer for his kind words of introduction.
Secondly, I am very humbled with the traditional chiefly ceremony of welcome that you have just accorded me.  I am touched by the warm words of welcome and the sentiments that were expressed during the ceremonies.  Thank you very much to all of you.

I beg your indulgence to say something in Fijian. 

Au vinakata me’u vakaraitaka na noqu vakavinavinaka cecekia ena veikidavaki vakaturaga, vakavanua ko ni vakayacora vei au ena mataka ni siga edaidai.  Lauti au sara na kena maqosa kei na kena bibi.  Vinaka vakalevu. 
Thirdly, I am deeply honored to be invited to participate in your golden jubilee celebration of the factory -here at Nabua.  For this invitation, I wish to convey my sincere appreciation to Mr Josefa Serulagilagi, Chairman of the Board and Chairman of the Public Service Commission for inviting me to this milestone event.  Fifty years is a long time and it has been a long haul. But keeping the Rewa Co-Operative Dairy Company operation going for this long is indeed a huge achievement and I commend the present and past Board of Directors together with its management staff for forging on through the various challenges since 1959.

Even though I have not been directly involved with Fiji’s dairy industry, I have personally been interested with the progress of the industry, particularly the activities here at the Nabua factory because for 25 years, I was your neighbor just up the road at Queen Elizabeth Barracks.

When I now look around here this morning, I recognize many faces from the five provinces which just shows how widespread the development service that the co-operative factory has provided to the provinces of Tailevu, Naitasiri, Rewa, Namosi and Serua.

In our young developing country all agro-industries face different levels of challenges as we work towards developing them. For your industry, it is encouraging to note that the number of suppliers and shareholders to this co-operative has increased over the past decade and a half. 

The presence of the dairy farmers here this morning, celebrating with the factory personnel signify the family approach on which this co-operative is based.
If we look back at history, value addition of dairy products began in fiji after the European servicemen of World War 1 had established their dairy farms in Tailevu on an area of land handed over by the Fijian landowners. The first butter factory known as the Tailevu Dairy was established in Korovou in 1921. Two more butter factories opened up within three years.

One factory at Waila on the banks of the Rewa River, which became the first Rewa Co-Operative Dairy Company. The other factory began operating from Navua in 1924, under the name of the Fiji Pastoral Company.

 I am reliably informed that by the early 30’s the three factories were able to meet the local market demand. There must have been a surplus of butter as the records have revealed that butter from Fiji was exported to Canada and the United Kingdom.

I hope that we can achieve this again in the future and especially with the various government supports to the milk suppliers over the past eighteen months, I can visualize the Rewa dairy products consistently present in our domestic market.

But let’s be ambitious, and I challenge all you farmers with this, that your Nabua factory can also service our Pacific Island neighbors who are struggling to keep their imported dairy product prices stable. So how about it!

In 1933, the Tailevu dairy and the Rewa Company amalgamated and combined the value-adding operation at the site near the Rewa River. The decision was reached due to the depressed state of the local dairy industry. The depressed state arose from the world depression of the 30’s.

The world economy is experiencing something similar this time around but it is encouraging to note that Fiji’s dairy industry is holding strong, with a reported increase in milk production so far this year and a healthy profit of over $1.1 million from a record turnover of over $48 million dollars in 2008.

Regulating the price of butter was introduced in 1940. The low returns that the Rewa Company was passing on to the farmers was due to that flat local market price and this eventually drove some dairy farms to seek an alternative - sugar cane production. As I said earlier, I commend the past leaders as the co-operative went through some very difficult times. This low return was due to price control and was attributed to the company almost becoming bankrupt hence its eventual closure.

The price control decision was later overturned after an appeal in the courts by the dairy industry players.

Dumping of products in Fiji is not a new thing. In 1957, lower price imported butter was being “dumped” on the local market. The local factories struggled to compete with the lower imported prices and the local finished stock accumulated in the warehouses.

The New Zealand dairy products marketing commission pressured the exporting countries and the cheap butter was withdrawn. This relationship with the New Zealand dairy is still strong up to the present time. The Rewa Dairy buys 75% of its bulk dairy products from the New Zealand dairy farmers co-operative firm called Fonterra.

A decade and a half after the introduction of price control the company decided to move to the current site. This decision was reached as the company wanted to venture into processing of sterilized milk and also to be closer to the main market of Suva.    
The second and final merge occurred in 1968, when the pastoral company decided to join the Rewa Co-Operative Dairy Company Limited. The pastoral company could not afford to invest in new equipment and the Rewa Company wanted more milk to keep its operation viable.

It is necessary for all of us here today, enjoying the success and progress of the co-operative to acknowledge the hard working people who established the industry in Fiji and rationalized the structure to ensure that the local industry remained viable whilst producing competitive dairy products.

J.P. Bailey was instrumental in instilling the standard and discipline that made the co-operative structure robust – a reputation which it still enjoys today. The factory establishment was necessary thanks to the 1920 settlers under the Tailevu scheme. I may not be able to name all of them but some that come to mind are H.P.Smith; Jack Beveridge, George Harness, Bill Blach, Bert Cooper, Herbert Meecham and William Hamilton. Still amongst us here today is a direct descendent of one of the early settlers, Michael Harness.

When trying to maintain and increase the local production in the 1960’s, government encouraged the local Indian families from Vunidawa to shift to Tailevu and continue what the pioneer dairy farms had established. This saw the Singh family name coming into prominence in the dairy industry circles. As of today, the Singhs continue to contribute in the development of the local dairy industry. 

Since 1959, the factory went through two major expansion programs. The first one in 1978 and the last major one in 1985. Nine of the board chairmen served the organization since its move to the Nabua factory. Bill Gatward was the Chairman when the operation shifted from Waila to this site. Others who chaired this organization include Eric Mcilwain, Warrick Mathieson, Lindsay Hunt, Herbert Murray, Bruce Lawlor, George Pickering and Ram Chand.

Six chief executives served the top administration and operation role since 1959. Norman Thomas Ralph had the challenging role of overseeing the construction and the shift to the new site in 1959. The others that held the helm here were Doug Mahon, Rod Finch, Deepak Rathod and Sam Speight.

Ladies and gentlemen, the 50 years old factory has housed different dairy plants as the firm upgraded and expanded into new dairy lines. This is a far cry from the first value addition factory where butter was churned in wooden vessels. The step up in technology in Fiji happened in 1959, when the Rewa Company installed the milk sterilizer processor with the glass bottle packer. The capacity was increased in 1978 to coincide with the building expansion.

The year 1986 saw another step up in dairy technology in Fiji where the Rewa Dairy introduced the ultra heat treatment processing of milk packed in tetra pak machines. It is especially important in food manufacturing, that system improvement is an on-going exercise and this is what the Rewa Dairy Factory embarks on every year as it works towards compliance and ensuring that it remains competitive in the market. I look forward to the tour of the factory later in today’s programme.

Ladies and gentlemen, this factory is at a very important stage as it adds value to the basic raw material, the raw milk, to make a product that the domestic market requires. It has been the provider of nutritious food for over four generations. The Nabua factory can make long shelf life liquid milk products; short shelf life products; hard cheese, soft cheese, yogurt, cream and butter.

At the moment, the milk powder is wholly imported and this is where i would like to urge the dairy farmers and the landowners present this morning, to work together and put in the extra effort for our nation.

The Fiji market that the factory serves, needs around 74 million litres of milk annually but unfortunately, local milk meets less than half, only 15% of this demand.

There is the suggested target by the Reserve Bank of Fiji to reduce dairy imports substantially by 2012. So, from these short statistics, we can deduce that the dairy industry has a great opportunity to grow whereby it contributes to the reduction of our trade deficit and the rural farmers benefit from much better returns.

We have an opportunity here where government recognizes the dire situation and identifies the local dairy industry to help in easing the situation. So let’s throw out the differences amongst the farmers and work together, and I am certain that collectively you and us will see positive results.

The chairman of the board, Mr Josefa Serulagilagi, has been involved in many successful projects towards development and rural livelihood and I am sure with all the challenging issues in the industry, he and his team have set the direction for the industry and the factory.  I strongly encourage the dairy farmers to support the board’s initiative. Once again I am very encouraged with the co-operative efforts and I will maintain my interest in the progress of this important industry. I wish the industry and Rewa Dairy Factory every success in the future.

Thank you, Vinaka vakalevu and Dhanyavaad