DAIRYGOLD TO RETURN TO ITS FORMER GLORY IN MALLOW BOOM
Deputy Tom Barry is predicting a return to the former glory of Dairygold in Mallow with confirmation that the company is to invest €130m in new milk drying facilities in the town that will boost local employment and multiply the co-ops production capabilities as milk production rises steadily between now and 2020.
“This is an extremely positive and exciting announcement for Mallow. It will bring direct employment, spin-off employment, economic activity and positivity to the town and is the perfect example of how agriculture and agri-food are going to be central toIreland’s economic recovery,” Deputy Barry said.
Dairygold CEO Jim Woulfe has outlined plans for this major investment at the Mallow 22 acre processing site, where the plan is to process an extra 23 million litres of milk over the current peak of 30 million litres per week. On a predicted usage of capacity, averaged over the year, of 60%, this would mean the co-op will be processing an extra 700 million litres per year.
Deputy Barry said: “I understand that farmer investment will be involved in this process – which is fantastic news. Dairygold has the brownfield site, the infrastructure in place, an abundance of milk production in the locality and all of the necessary services in place. They are looking at a 50% increase in milk production post the removal of quotas in 2015 and now is the time to put the necessary production facilities in place.”
Mr Woulfe recently outlined: “While we are still collecting and collating data, the initial findings indicate an increase in excess of 50% in milk production by Dairygold suppliers up to 2020, comprising of a 22% increase in the combined years 2014/2015 followed by a projected growth of approximately 5% in each of the five following years to 2020. Most importantly milk expansion will provide Dairygold milk suppliers with additional income. At current milk prices Dairygold potentially will be paying an additional €160 million annually to its farmers by 2020. This income will have a significant knock on multiplier effect on the wider economy, especially in Munster.”
“Milk-drying facilities seem to offer the most economically advantageous and beneficial option to deliver post quota processing capacity. Drying offers flexibility, it can be built up gradually in a modular fashion and it allows for the production of a variety of products including Whole Milk Powder, Infant Milk Formula Base and Fat Filled Milk Powder. In Dairygold it has the added attraction of fitting into our ambitions for expansion in the supply of speciality dairy ingredients to the IMF sector.”
“In the meantime our Mallow site is an excellent brown field site of 22 acres which would facilitate a major processing expansion. Mallow has a long tradition in the production of milk powders and would be an ideal location for additional drying capacity where the infrastructure already in place would reduce the capital cost of significant expansion.”
On marketing of the additional dairy product Mr Woulfe said; “The Irish Dairy Board is a very effective sales and marketing arm for a substantial proportion of Irish milk processors’ output. The Kerrygold brand has a real competitive advantage and the Board’s sales capability reaches all the major developing economies that are recognised as growth markets. Dairygold has been working closely with the IDB to develop that organisation’s strategic growth plan which aims to increase Irish dairy exports by leveraging its international brands and building new routes to value and growth markets. Dairygold’s own commercial team will continue to be firmly focussed on selected key markets/customers where speciality products with a B2B focus will be further developed and grown.”