Cadbury sweet on Ord cocoa

Brad ThompsonThe West Australian

The US-based company which owns the Cadbury and Vegemite brands is eyeing a major investment in the Ord River irrigation scheme.

Mondelez, until recently known as Kraft Foods Australia, has its sights on producing cocoa based in part on a major Federal Government study backing the feasibility of growing trees in northern Australia.

Cadbury produces about 50,000 tonnes of chocolate a year using cocoa imported from Ghana and Mondelez is planning a $66 million upgrade of its plant near Hobart.

It is believed the Ord has been identified as a source of up to 10 per cent of Cadbury's annual cocoa needs.

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Coalition leader Tony Abbott fuelled speculation about a possible investment in about 1000ha near Kununurra last week when he pledged $16 million to help the Cadbury upgrade, with an unspecified amount set aside for a cocoa trial on the Ord.

The pledge raised eyebrows given Kraft made a net profit of almost $75 million in 2012 and Mr Abbott admitted it was "unusual for the national government to co-invest, as it were, with a profitable private business".

The Mondelez interest in the Ord comes as more details emerge about the State Government's tender process to develop stage two of the irrigation scheme.

_WestBusiness _can reveal that up to eight Chinese companies looked at the major agricultural investment opportunity, with one state-owned entity heavily involved in the tender process.

Yinmore, which is owned by Bright Foods and ultimately the Chinese Government, hired Melbourne-based consultants to help with its bid and held in-depth talks with the State Government.

It also sought the advice of former Ord sugar growers and land owners.

Yinmore is a big sugar producer in China and Bright Foods is one of the biggest distributors of sugar products. Bright Foods became owner of the Margaret River Dairy Company and Fremantle-based olive company Don Vica in 2011 when it paid $400 million for a 75 per cent stake in Australian food distributor Manassen.

The State Government announced in November it had opted for Chinese company Shanghai Zhongfu, trading in Australia as Kimberley Agricultural Investments, to develop 13,400ha of land released under stage two of the Ord scheme.

Australian Agricultural Company, which is controlled by overseas investors, and sandalwood producer TFS were named as others in the tender process but Yinmore's interest was not revealed.

Although Shanghai Zhongfu is privately owned, Premier Colin Barnett strongly backed investment by Chinese Government-owned conglomerates when he confirmed the Ord deal.

Mr Barnett said it was a fact of life that big Chinese investment came from state-owned entities.

The State Government spent $311 million on a 31km extension and upgrade of the main irrigation channel and construction of 40km of sealed roads to attract investment in stage two.

The Northern Territory Government is working with traditional land owners on a deal to extend the irrigation scheme across the border, while the WA Government is considering a plan to increase the capacity of Lake Argyle by about 5000 gigalitres for use in agriculture.

KAI has said it wants more land on both sides of the border as part of plans to develop a sugar industry.

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