Meat processor Silver Fern Farms is working on replacement funding for an existing $75 million of bonds reports Business Day. The $75m tranche is due to mature in December and the meat processing co-operative is mulling options including a further bond issue or alternative funding from banks. SFF had about $184.5m of debt at August 31. It needs capital or further facilities to help pay debt that is rolling over and to continue its farm-pasture-to-customer-plate marketing strategy. SFF's previous capital-raising plan ended with a splutter rather than a surge with farmer suppliers only ploughing in about $22m of new equity, much less than originally envisaged. Chief executive Keith Cooper did not specify any plans for SFF to tap "partners" or new shareholders for further funds. He said the SFF finance team was working through debt-related options including existing bank facilities. "We've got normal financing sources – the normal capital market channels, the banks, the option of another bond. There's a variety of mechanisms we can use to refinance it." The New Zealand lamb season had been delayed during a season where it had been predicted that one million more lambs than last year would be processed to bring the total to about 23 million."But the season has been very slow because the farmers have grass. As of a week ago we were 1.5 million lambs behind compared with last year," Mr Cooper said. "The danger of that is we [will be] killing them out of the traditional peak time ... because the farmers are growing them heavier we run the risk we may be producing too many at the one time and at the too-heavy weight for market requirements."
We welcome your comments below. If you are not already registered, please register to comment.
Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current comment policy is here.