Dairy Industry Newsletter (DIN) Global Conference

Glanbia Ireland is working to re-invent its business model by moving towards more demand driven high value solutions, Jim Bergin told the Dairy Industry Newsletter (DIN) global conference in London.

In line with the theme of the conference ‘Will dairy supply continue to outstrip demand?’, Mr Bergin highlighted research has shown the major trends for consumers are health, sustainability and authenticity.

Glanbia Ireland chief executive Mr Bergin said annual milk volume intake was expected to continue to rise over the next five years, however, it would move towards more modest levels of growth in the medium-term.

Mr Bergin said the industry was evolving towards an environmental ‘licence to grow’, with sustainability, water quality and carbon production all key considerations for a new environmental charter.

Mr Bergin said Glanbia Ireland was pursuing value versus volume, which was in line with the environmental charter and highlighted by the Royal A-ware venture due to come to fruition in 2022.

A strategic partnership with Royal A-ware a leading dairy producer from the Netherlands will see Glanbia Ireland invest €140m in a new world-class continental cheese production facility in Belview, Co Kilkenny.

Mr Bergin told the industry gathering that this joint venture (JV), which replicates the successful Glanbia JV model in the US, leverages JV independent funding and brings new routes to market.

In addition, he said it allows for the development of new technologies at scale, whilst also reducing our dependence on both cheddar and the UK market.

“It will add over 450 million litres of processing capacity and also create a new whey stream for Glanbia Ireland to create additional value,” Mr Bergin told the conference.

The DIN conference attracts industry leaders, mainly from the UK but also from continental Europe.

Jim Bergin told the conference that there has been a 42% growth in Glanbia Ireland milk supply between 2014 and 2018 by existing suppliers. To process growing milk volumes, weekly processing capacity has been increased by 38 million litres since 2015. The milk pool now stands at over 2.7 billion litres of milk processed annually.

There have been three separate investments totalling €343m. The first expansion at the infant nutrition plant at Belview, Co Kilkenny in 2015 cost €178m and turned it into a flagship manufacturing site with extra capacity of 17 million litres a week. A further phase of expansion followed at a cost of €130m which delivered an extra 15 million litres a week.

In addition, a €35m investment was undertaken at the cheese processing plant at Rocklands, Co Wexford, which doubled the peak milk processing capacity at the plant.

First Published 14 May 2019