Dairy processors plan €230m investment over next two years

INVESTMENT in the dairy processing sector could top €230m over the next two years as the rapid expansion in the country’s milk pool continues.

Although some processors said they had sufficient capacity to deal with expected milk supply growth, others are continuing to invest.

Glanbia and Dairygold are planning the most significant developments, which is hardly surprising given that the south and south-east are forecast to experience the largest increase in milk volumes.

A key element of Dairygold’s next phase of expansion relates to planned development at its Mogeely site, where the co-op has applied to build a new Jarlsberg cheese production facility. Plans for this €100m development — which is a joint venture with TINE, Norway’s largest farmer-owned dairy co-op — are currently with An Bord Pleanála, with a decision expected in March.

Glanbia Ireland chief executive Jim Bergin told recent farmer information meetings that the company will invest €125m in milk processing capacity to cater for the expansion in milk supply.

Planning permission has been secured for the erection of a new milk dryer at Belview. Farmers were also told that the company is currently investing in new equipment to increase the 2018 processing capacity of the two existing driers at the Belview plant.

Meanwhile, Arrabawn have also increased their overall processing with a €6m investment. The growth in supplies to the mid-west dairy will see milk volumes hit 500m litres by 2020.

Kerry Group and Lakeland Dairies said they had no plans for further spending in new processing facilities in 2018-19, however, both dairies pointed out that significant investment had been made in stainless steel over the last number of years.

It was a similar story at Carbery. A spokesperson said the West Cork processor has sufficient capacity for the next few years. However, she said the company was assessing medium and longer-term manufacturing requirements.