Fifty Wexford suppliers to take 15m litres in move to Strathroy
FIFTY suppliers and more than 15m litres of milk look likely to shift from Wexford Creamery to Northern Irish milk processor Strathroy during the first half of this year.
Ruairi Cunningham of Strathroy said 50 farmers have already given notice to Wexford Milk Producers (WMP) – the co-op that owns a controlling stake in Wexford Creamery – that they intend moving their milk supply.
These figures have been confirmed by Wexford Creamery. A spokesman said that 40 lodged notices of intent to switch processor before the end of December and their milk will move on April 1. A further 10 suppliers had given notice since January 1, their milk will move on July 1.
The suppliers can retract the notice at any time up to the designated date for moving but Mr Cunningham said he was confident this would not occur in the vast majority of cases.
He described the suppliers who had expressed an interest in joining Strathroy as “fairly determined” and said he would be surprised if the entire 50 did not move.
“A lot of boys are waiting to see how things work out and more will move as the year goes on; we could get 100,” Mr Cunningham predicted.
Wexford has close to 330 dairy farmers and a total milk pool of 103m litres.
One Wexford dairy farmer who is considering switching to Strathroy said farmer dissatisfaction with the terms of the deal which saw WMP sell its controlling stake in Wexford Creamery to Glanbia Ingredients Ireland (GIIL) had contributed to decision of many farmers to move.
The 10-year milk supply contract that was initially sought by GIIL and the fact that WMP would have no representation on the Glanbia board were among the main issues of contention, he said.
Strathroy are offering farmers a five-year rolling contract, with a three-month notice period required if suppliers wish to leave.
The GIIL milk supply agreement is for a five-year fixed term, with two years notice required from those seeking to switch processor.
Mr Cunningham said Strathroy would require between one and four milk trucks to collect the Wexford supplies, depending on the time of year.
However, he insisted that the company had received a lot of calls from farmers across south Leinster and Munster who were interested in talking to Strathroy and he said they would start discussions once the Wexford supply situation was “bedded down”.