In an increasing volatile milk production environment, it is good to know that one company keeps its promises: Clover. For the milk producer this means he can count on a fixed milk delivery agreement and/or supply contract to ensure his interests, even in times of surplus. This is possible thanks to a growth in demand for our products due to Clover's exceptionally strong brand, which guarantees turnover even during periods of surplus. Add Clover's infrastructure, its experience as Africa's largest milk processor and the national distribution of its products through the country's largest chilled distribution network, and milk delivery to Clover becomes the answer to every milk producer's requirements. No wonder the cream of South Africa's milk producers already supply milk to Clover!
More Than 100 Years
Clover and the milk producer have shared common interests for more than a century. In fact, Clover's origins can be traced back to a meeting of milk producers in the Mooi River district (today KwaZulu Natal) in 1898 with the aim of starting a butter factory in what was then the province of Natal. The organisation that resulted from this first meeting was registered as National Co-operative Dairies (NCD) in 1943, with milk producers at the helm. NCD grew to become the largest dairy group in South Africa and in November 2003 the conversion of the co-operative to a public company was approved by the board of directors. Today, milk producers still have the controlling interest in Clover Industries Limited (CIL) and the right to appoint the majority of directors in CIL. These directors must all be active milk producers and therefore even the CIL directorate understands the heartbeat of the milk producer.
Read more about Clover's history by clicking here .
A Few of Clover's Recent Achievements
One of the top 500 companies in terms of corporate governance
Corporate governance rating of A-g and a credit rating of zaBBB. This is better than many listed companies and a first for dairy in South Africa.
Excellent growth in preference share value
In a countrywise poll, the Clover brand was voted South Africa's seventh most well-known brand.
Read more about Clover's achievements by clicking here .
The Advantages of Milk Delivery to Clover
Clover purchases milk regionally based on volume, milk composition and quality
Milk is collected timeously and sampled by reliable and trained truck drivers
Producers are paid electronically on the fourth working day of every month of milk purchased
Clover has a fair and transparent milk procurement system and nearly all factors affecting the price can be managed by the producer to increase his millk price
Milk samples are analysed by an independently accredited laboratory
Producers receive weekly feedback on milk volumes collected as well as the latest milk sample analysis results regarding milk composition and quality
Clover encourages growth for producers who want to grow with the company
Producers receive advice and assistance in establishing and applying internationally recognised best practices on their farms. The following categories are important:
Animal health and herd management
Animal nutrition and water
Animal remedies and agricultural chemicals
Milk hygiene and safety
Environmental management
Staff/people
Communication structures are in place to ensure that the Clover producer's voice is heard
All complaints are addressed speedily and effectively. The focus is on constant improvement
Milk procurement offices, staffed by producer services managers and/or milk procurement logistics managers, have been established in the following towns and cities:
Bethlehem
Boksburg
Heilbron
Lichtenburg
Wesselsbron
Estcourt
Ixopo
Port Elizabeth
Clover's Milk Purchasing System
Milk purchases are based on the following principles:
Butterfat
Butterfat is purchased on a rand per kilogram basis and the minimum required butterfat content is 3,30%
Protein
Under normal conditions, protein is also purchased on a rand per kilogram basis, and the minimum required protein content is 3,00%. However, producers have the option of receiving their protein payments in cents per litre. In this case, the protein payment becomes part of the regional price for volume, e.g. Western Cape.
Volume
Each region has a unique price for volume. Some regions receive volume premiums above certain supply levels. Clover does not service producers who supply less than 1000 litres per every other day collection.
Cost of collection
Clover has developed a sophisticated, but transparent model to ensure that milk collection costs are accurately and fairly recovered from producers. These costs are calculated in rands per collection and therefore the producer's volume per collection plays a very important role in determining the collection cost in cents per litre
Milk quality
The ideal milk quality has a bacto count of lower than 200 000/ml and a somatic cell count below 400 000/ml. A premium and penalty system on a sliding scale encourages producers to supply the best possible milk quality.
Clover jealously protects its superb product quality and safety. In addition to the above tests, Clover also regularly tests for added water and contaminants in milk. Insurance against inhibitors is available for producers who wish to protect themselves against risk. Clover provides a further service to producers by regularly testing for brucellosis by means of the milk ring test. The milk urea nitrogen content is also regularly tested for ration balancing purposes.
Market perceptions are extremely important to Clover and due to negative consumer perceptions of the use of hormones, Clover does not puchase milk from herds treated with rBST. All Clover producers are required to sign an rBST-free agreement.
Producers who wish to supply milk to Clover can do so by means of a delivery agreement, a supply contract or a combination of the two. Click here .
Clover's Delivery Agreements
Delivery agreements and accompanying ordinary CIL shares are freely traded within regions and can also be exchanged between producers who have delivery agreements. A delivery agreement is a lifelong right that may be passed on to the holder's heirs.
Producers acquire delivery agreements and accompanying ordinary shares by purchasing them from other producers. The ordinary shares ensure producers' control of CIL and are the only shares that guarantee voting rights.
Find our delivery agreements and contracts by clicking here .
Clover's Supply Contracts
A supply contract is awarded for a minimum period of 12 months and continues until one of the two parties indicates that it wishes to terminate the contract. A mutual notice period of three months applies after the first 12 months. Should there be a negative milk price adjustment during the first 12 months, however, the producer has the right to give three months' notice of thermination. Supply contracts may also be negotiated for periods exceeding 12 months. No cost is involved in supply contracts.
Clover and the milk producer have shared common interests for more than a century. In fact, Clover's origins can be traced back to a meeting of milk producers in the Mooi River district (today KwaZulu Natal) in 1898 with the aim of starting a butter factory in what was then the province of Natal. The organisation that resulted from this first meeting was registered as National Co-operative Dairies (NCD) in 1943, with milk producers at the helm. NCD grew to become the largest dairy group in South Africa and in November 2003 the conversion of the co-operative to a public company was approved by the board of directors. Today, milk producers still have the controlling interest in Clover Industries Limited (CIL) and the right to appoint the majority of directors in CIL. These directors must all be active milk producers and therefore even the CIL directorate understands the heartbeat of the milk producer.
One of the top 500 companies in terms of corporate governance
Clover purchases milk regionally based on volume, milk composition and quality
Clover jealously protects its superb product quality and safety. In addition to the above tests, Clover also regularly tests for added water and contaminants in milk. Insurance against inhibitors is available for producers who wish to protect themselves against risk. Clover provides a further service to producers by regularly testing for brucellosis by means of the milk ring test. The milk urea nitrogen content is also regularly tested for ration balancing purposes.
A supply contract is awarded for a minimum period of 12 months and continues until one of the two parties indicates that it wishes to terminate the contract. A mutual notice period of three months applies after the first 12 months. Should there be a negative milk price adjustment during the first 12 months, however, the producer has the right to give three months' notice of thermination. Supply contracts may also be negotiated for periods exceeding 12 months. No cost is involved in supply contracts.
