The "stable and transparent milk price" project by Colruyt Group and Inex can now start
The project by Colruyt Group and Inex to deliver a transparent and stable milk price is getting its official launch after sufficient dairy farmers affiliated to Inex signed up to the proposal that the two partners presented to them in February. Once the first Boni Selection products from this project go on sale in Colruyt Group stores from April 2020, 328 dairy farmers will receive a stable milk price of 34.76 cents/litre for a specific percentage of their milk volume.
On 21 February 2019, dairy farmers affiliated to Inex all received the same proposal to join a partnership between Colruyt Group and Inex which would give them a transparent, stable milk price for part of their milk volume. They were then given until 1 April to consider the proposal. 328 dairy farmers signed up; enough to effectively get the project off the ground. Jointly, these 328 dairy farmers will provide the required volume of 30 million litres of milk, an important part of Colruyt Group’s total milk volume.
From April 2020, each participating dairy farmer will step into the project for 18,50% of their milk volume, for the next 5 years. That percentage can lead up to 30% of their volume, depending on how well the new Boni Selection products sell. The dairy farmers will be paid a fixed milk price of 34.76 cents/litre for the whole period. Inex and Colruyt Group have the intention to evaluate the project during and after these 5 years, to adjust where necessary and to continue with it. Most participating dairy farmers were attracted by the prospect of reliable sales and a stable price.
Stefan Goethaert, Managing Director Fine Food, Private Label and Retail Services at Colruyt Group, and responsible for the group's agricultural policy, is satisfied with the outcome: "This is fantastic news. This is the first time that we've made a proposal like this, so it's been very exciting for us. And obviously we're pleased that we can actually put it into practice. We're delighted that this initiative contributes to our objective of giving Belgian dairy farmers as much support as possible and we want to thank them for putting their trust in us."
Next steps: working towards a new range in 2020
All the parties involved are now working to move things forward. Inex will invest in a new state-of-the-art production line to handle the increased volumes and both partners will be working on new packaging and labels for this new range of Boni Selection products over the coming months, so that they are clearly marked for customers to see.
This will involve around ten milk products, including Boni Selection skim, low-fat and whole milk (50 cl and 1 L), as well as Boni Selection Cream. This project's first products will go on sale in Colruyt Group's food stores in a year's time, around April 2020.
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Colruyt Group operates in the food and non-food distribution sector in Belgium, France and Luxembourg with approximately 570 own stores and 580 affiliated stores. In Belgium this includes Colruyt, OKay, Bio-Planet, Cru, Dreamland, Dreambaby and the affiliated stores Spar and Spar Compact. In France, in addition to Colruyt stores, there are also affiliated Coccinelle, Coccimarket and Panier Sympa stores. The group is also actively involved in the foodservice business (supply of food products to hospitals, company canteens and catering businesses) in Belgium (Solucious). The other activities comprise the sale of fuel in Belgium (DATS 24), printing and document management solutions (Symeta) and the production of green energy (Eoly). The group employs over 29.900 employees and recorded a EUR 9,4 billion revenue in 2018/19. Colruyt is listed on NYSE Euronext Brussels (COLR) under ISIN code BE0974256852.