IN A huge blow to the Gympie region economy and Queensland's embattled dairy industry, Hope Dairies confirmed yesterday it had put its proposed $500 million Mary Valley powdered milk project on hold while it focuses on beef to our west.
Gina Rinehart will instead now cash in on the new demand for meat from Australia's northern neighbours.
The exorbitant cost of accessing water for the dairy operation, and Queensland's movement restrictions on cattle, implemented to reduce the spread of the cattle wasting disease bovine johnes, are believed to have played a part in killing the proposal.
The 3000ha of land she purchased in the South Burnett to graze up to 16,000 head of dairy cattle for a baby formula manufacturing plant near Gympie, will now be stocked with beef cattle or planted with feed.
A Hope Dairies spokesman said yesterday market conditions had become more conducive to wagyu beef than powdered milk.
"We are continuing to invest in agriculture in Queensland, putting the land already purchased to use developing a beef cattle operation, producing both feed for wagyu cattle and wagyu cattle for the domestic and international markets," he said.
"Market conditions are now more conducive to wagyu than particular dairy products for one market."
Member for Gympie Tony Perrett said he was disappointed at the decision.
"During the last seven months the State Labor Government has been dealing directly with Hope Dairies on the proposal," he said.
"Despite contacting the office of the Minister for State Development, Natural Resources and Minister for Mines, Dr Anthony Lynham, I have not received any advice from them concerning this issue.
"I had met with Hope Dairies shortly after being elected to offer whatever help I could and have remained supportive of substantial investment possibilities in the Mary Valley.
"This is a due diligence and commercial decision of a private company and unfortunately the current conditions and commercial challenges of establishing a venture of this size has meant the proposal won't proceed at this stage.
"While I am disappointed with the loss of the significant commercial investment in the Gympie electorate, I am pleased it will continue to maintain a commercial investment and interest in the broader region and that it recognises the importance of agriculture activities in this region of Australia.
"I look forward to working with the company when further opportunities present themselves in the future," he said.