One of Ireland’s largest dairy companies has said that it has increased the amount of milk it processes by 25% since the abolition of European milk quotas, as the dairy industry marks a year since the restrictions were lifted.
The quotas, which had been in place for three decades and controlled the amount of milk coming out of dairy farms in the EU, were lifted on 1 April 2015. The move was expected to boost the European dairy sector, and Glanbia Ingredients Ireland has now revealed that 85% of its suppliers have expanded their farms to facilitate the increase in production. Its milk suppliers now provide 22% more milk than previous years, Glanbia added.
By 2020, Glanbia’s 4,800 milk suppliers are expected to increase their milk production by 63%; at the time that the quotas were removed, Glanbia Ingredients Ireland was processing 1.8 billion litres of milk, equivalent to 30% of Ireland’s total milk pool. While inclement weather in recent weeks has limited the ability to maximise farm output, current calving numbers indicate a considerable increase for 2016, which has already been reflected in a volume increase of about 20% for January and February.
At the time that the quotas were removed, Irish taoiseach (prime minister) Enda Kenny described the effort of Irish dairy processors to increase the capacity of their production facilities as “an important strategic development”, while Glanbia Ingredients Ireland said that it would create a “generational opportunity” for the Irish dairy sector.
It was predicted that, post-quota, Ireland could become the fastest-growing dairy market anywhere in the world for five years.
In preparation for the removal of the milk quotas, Glanbia Ingredients Ireland embarked on a €235m investment programme, including opening a new milk protein plant in County Cavan; expanding its butter facility in County Kilkenny to a capacity of 80,000 tonnes; and launching a high-spec infant formula standard facility, also in County Kilkenny, in the south of the country.
“We have worked very collaboratively with our strategic customers on delivering this facility to the standard required for ingredients into internationally recognised infant formula brands,” said Nick Whelan, commercial director for Glanbia Ingredients Ireland. “It is rewarding for all involved to see this now come to fruition.
“While there’s no doubt that global dairy markets are under significant pressure currently, we have an ambitious growth plan through to 2020 and we are confident in delivering it. Significant investment in infrastructure and technology coupled with our on-going support of our farmer supplier base as they seek to ramp up supply in challenging times will ensure that we continue to meet our customers’ expectations for quality dairy ingredients.”
The company will continue to deliver on its commitment to process suppliers’ growing milk pool by expanding its Wexford cheese facility with an investment of €35m, doubling capacity at the plant. It has also launched its Wexford-branded cheese into the Middle East region, with a range of quality Irish cheddars aimed at the horeca and foodservice sectors.
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