‘Innovation at processing level will not increase milk prices’

Innovation at processing level will not increase farmgate milk prices per se, according to Glanbia Chairman Henry Corbally.

“Rather it will ensure that we remain competitive in an ever-changing market,” he said.

“The one exception to this principle relates to branding. In our own case, we have invested heavily in the Avonmore brand, both locally and internationally, over a long number of years. The alternative of doing own-label deals with supermarkets would have seen the liquid milk market in Ireland totally devastated.

“And this would have been a disaster for Irish dairy farmers.

“Innovation is all about building momentum. A case in point is the revolution that has been effected within the field of sports nutrition over the past decade, all of which has been driven by the availability of whey protein.”

Corbally was speaking at the official opening of Glanbia’s new UHT plant at Lough Egish in Co. Monaghan.

“Its location particularly suits farmer suppliers in the northern part of our catchment area,” he said.

“Their herds tend to have a flatter production profile. And the new plant will need fresh milk the year round.”

Corbally said that the Irish dairy co-ops had supported farm gate milk prices to the tune of €100m in 2015.

And this level of commitment will be maintained.

Corbally confirmed that Glanbia’s guaranteed payment scheme will go live at the beginning of January next. It offers farmers a base price of 30.25c/L (including VAT) at reference milk constituents of 3.6% butterfat and 3.3% protein.

The measure will also provide farmer suppliers with an opportunity of agreeing fixed price feed contracts moving forward, he said.

“My understanding is that the uptake for the new scheme has been very positive.

“Where feed is concerned milk producers will be able to avail of a €10/t subsidy.”