Sour note for dairy farmers

Dairy farmers left hundreds of thousands of dollars out of pocket after the Challenge Dairy collapse last year will recover only a fraction of what is owed.

Administrator PPB Advisory said farmers would receive between 6 and 25 cents in the dollar from an estimated $2.05 million to $4.35 million in assets; however, it would be at least five months before farmers received any money at all.

PPB recently met the receivers of Challenge Australia Dairy, PricewaterhouseCoopers, to discuss the outstanding issues surrounding its retirement as receivers and the estimated residual assets available to the liquidators.

PPB said it expected to meet all employee entitlements in full, with a priority dividend to employees to be paid about three months after funds were obtained from receivers.

“The assets available to PPB Advisory, after the receivers’ retirement, are estimated at between $2.05 million and $4.35 million with the return to unsecured creditors estimated to be between 6.47 and 24.16 cents in the dollar, ” a statement said.

“The timing of the dividend to unsecured creditors will depend on the recovery of the assets. There are matters that need to be resolved by the receivers before they can retire, however it is estimated they will retire by August 2011 at the earliest.”

WA Farmers dairy section president Peter Evans said it was disappointing for Challenge farmers.

“It (the payment estimation) is probably as low as we could have expected, so farmers will be very disappointed, ” he said.