PALLA Pharma Ltd, previously known as TPI Enterprises, has been placed into liquidation following the inability to find a purchaser of the company.
Announced to shareholders last week, the decision follows the company going into voluntary administration in December last year.
In that time, efforts were made to sell the company, but with the sale process not finding an appropriate buyer, the ‘wind-down’ of Australian operations was recently announced.
Palla Pharma started life as Tasmanian Poppy Industries in 2004 and has since moved interstate, processing poppies from Tasmania as well as New South Wales and Victoria.
Chief Executive of Poppy Growers Tasmania Keith Rice said Palla Pharma and TPI always faced a difficult proposition in competing with two international poppy processing companies within the Australian market, when so many comparative international competitors had just one processor per country.
“Competition in the international market has been enormously strong, we need to look at the world market in the context that Australia was the only place with three producers.
“To break into the market when they did and to continue against two major companies (SunPharma and Extractas) was always going to be a difficult proposition.”
Mr Rice said TPI no longer growing in Tasmania would certainly have a negative effect on Tasmanian farmers.
“I understand they grew around 1000-1500ha for the last few years, with a group of loyal growers. To take that out of the system is always a concern.”
“While we still hold around 50 per cent of the world supply, it is a fierce, fierce market.”
“Some companies overseas have increased their capacity twofold since 2010.”
“They’re in a position to drive the prices down in order to compete, which in turn hits us hard.”
“Between growing world stocks, increased productivity and competition, it’s getting very competitive, very quickly.”