Food factory hopes fade

Hopes are diminishing for a new food factory in Kyabram as the Goulburn Valley Food Co-op explores other options.

The cooperative was formed a year ago after Heinz closed its tomato processing factory in Girgarre and the group was hoping to raise enough money by March to operate from a new site.

However, the cooperative's chairman, Les Cameron, has told the Rural Report, a new factory might pose financial risks in the future.

"I think we're probably starting to think our co-op should be cooperating with a whole lot of other people rather than just setting up as a sort of an independent agency," he said.

"So probably the underlying interest in people long-term is okay how to take the big picture rather than the picture that might have solved our own local problems but maybe just created others long-term."

He says the project no longer appears to be economically viable.

"The more we investigate the more we find that there's a lot of marginal, small, food factories producing around Australia, that the biggest problem is that they need to be coordinated and to be able to be linked around a common product," he said.

"They're all sort of battling for their existence and we felt gradually as we spoke to people as though hey maybe we would be just duplicating what Australia already have."

Source: ABC News, 15 January 2013