Lakeland Dairies’ recently acquired milk processing operation at Banbridge in Co. Down – formerly owned by Fane Valley – is not for sale, according to the co-op’s Chief Executive Michael Hanley.
The plant is not operating at the present time, he said.
“There are two dryers on site, both of which have been maintained to a fully operational level. Our plan is to manage the Banbridge operation on a wholly flexible basis.”
Hanley did not rule out the possibility of bringing both dryers back on stream at some stage next year. But he did admit that the Banbridge facility could play a key role as part of Lakeland’s post-Brexit strategy.
“We have two plants in Northern Ireland – Banbridge and the Pritchitt facility in Newtownards. Both are critical in terms of our plans moving forward.”
Commenting on the current state of world dairy markets, Hanley said that global demand continues to increase at around 1.5% per year.
“It is the recent cutback in global milk output that has brought about the upturn in dairy prices,” he said.
Global dairy markets are currently in balance. The recent upturn in oil prices may well increase demand from oil producing countries.
“History indicates a link between oil prices and the strength of global dairy prices.
Hanley confirmed the recent strengthening of butter prices. He said this was due to the changed perception of butter where international chefs are concerned.
“Butter is now seen as a very healthy food to eat. The fact that it is a very natural product is also helping to boost its image at the present time.”
The Lakeland CEO pointed out that the results of the Global Dairy Trade event are often misinterpreted.
“Yes, GDT prices increased again this week. But the 30,000t of product sold will be delivered during the period up to May of next year.
“And it is this factor that will determine the overall price that processers can pay farmers over the coming months. GDT prices are not a reflection of the market returns that are immediately available to processers.”
