Originally Posted by
xafalcon
Synlait are primarily a commodity processor. Their inventory is primarily commodities like AMF, WMP, SMP.
Any inventory carried for ATM will be very small in comparison . But SML can only sell it to ATM
If Synlait have over-produced ATM formula (without a forecast from ATM), it could be problematic. Certain markets are formula-age sensitive. Chinese customers, for example, view IMF products over 12M age as unsuitable.
Commodity products have no such issues. They are good for 2 years or more. Being commodities, they have standardised compositions. Hence they also have a variety of uses and many customers, so plenty of sales opportunities. It just may require SML to drop their price to move older stock