Glanbia Eyes Milk Quota Removal Potential With Major Investment

23 Feb 2015 --- With only 5 weeks until EU milk quotas are removed, the Irish Dairy industry is priming itself to commence production in a new era for dairy farming. Glanbia Ingredients Ireland (GII) will officially launch its infant-formula-grade greenfield nutritional ingredients plant in Belview, County Kilkenny on March 5.

With support from Enterprise Ireland, the €185 million Belview development is the largest single dairy investment in the history of the State and it will contribute greatly to Ireland's export-led recovery. It’s part of a wider €200 million investment program that also includes a new €7.8 million milk protein plant in Co. Cavan, a new butter plant and a new whey protein plant in Co. Kilkenny.

The removal of milk quotas gives Ireland a unique opportunity to increase milk production and bring an additional €1 billion into the Irish economy.

Harvest 2020 (The Irish Government’s Strategy for Agriculture) has indicated an expected +50% growth in milk supply to meet demand by 2020. For the first time in 30 years, Irish dairy farmers can in effect increase their production without having to purchase additional milk quota rights.

The Glanbia Ingredients Ireland facility will supply markets in Asia, Middle East, Africa and Central / South America through existing and new partnerships with GII.

Jim Bergin, CEO, Glanbia Ingredients Ireland told FoodIngredientsFirst: “Quotas have been in place since 1984 and their removal at the end of March has the potential to radically transform Ireland’s rural economy. For the first time in 30 years, Irish dairy farmers can increase their production without having to purchase additional milk quota rights. It represents a momentous juncture, not just for dairy farmers but for Ireland’s export economy. Ireland is in a very similar situation to New Zealand, with a large dairy industry and grass based system naturally suited to sustainable dairy farming.”

“When milk quotas were introduced back in 1984, Ireland and New Zealand both produced approximately 5 billion liters annually. New Zealand did not have to partake in a quota regime and now produce 20 billion liters of milk annually. The removal of milk quotas gives Ireland a unique opportunity to increase milk production and bring an additional €1 billion into the Irish economy. Harvest 2020 has indicated an expected +50% growth in milk supply to meet demand by 2020.”

Bergin notes that the change will mean a huge opportunity for the company. “GII is Ireland’s leading dairy ingredients company. We process 1.6 billion liters of milk, or 30% of Ireland’s milk pool, into a range of dairy ingredients for export to more than 50 countries. The Nutritional Ingredients Plant at Belview has been developed specifically for the export market and we are targeting high growth developing regions in particular. It’s a key plank within our growth strategy to prepare for the removal of EU milk quotas at the end of March and will enable us to increase our production and grow further into export markets,” he says.

By Robin Wyers