Further analysis has been carried out on the financial viability of reopening Blue Sky Meats’ Gore plant and will be discussed by the board this week.
Blue Sky Meats chief executive Todd Grave said thorough financial analysis had been carried out.
Processing at the Gore plant, formerly known as Clover Meats, came to a halt late last year because of low financial margins.
The plant was scheduled to reopen in November.
“We’re really taking our time on it,” Mr Grave said.
The findings of the analysis will be presented to the board tomorrow.
Chairman Scott O’Donnell said if profit margins for beef improve, Blue Sky will reopen its Gore plant.
When the cost of buying cattle and global market prices for the product yielded a profitable margin for the company, then the plant could reopen.
The Gore plant predominantly processed beef, plus some horse and deer.
Both salary and process workers from the Gore plant were offered secondment to the Morton Mains plant near Invercargill.
Mr O’Donnell said cull cows from dairy farms made up the bulk of processing at the Gore plant.
“They’re a very seasonal thing,” Mr O’Donnell said.
The company bought the Gore plant in 2014. The plant had been upgraded at a cost of $1.5million.
“It was a worthwhile investment at the time,” he said.
When Blue Sky bought the plant, the milk solids price was at $6 a kilogram, he said.
Shortly after buying the plant the company closed it for refurbishment.
Then the milk price slumped and there was a huge demand for space for cull dairy cows at processing plants.
could not process the abundance of cull cows, Mr O’Donnell said.
The company was waiting for a favourable financial climate to start processing there again.
“It’s only a timing thing for us.”