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DAIRYGOLD, IRELAND’S LARGEST dairy farming co-op, has announced excellent profits for the second year running.
The privately owned co-op recorded operating profits of €27.2 million for 2014, almost level with the €27.3 million brought in in 2013.
Turnover was also up slightly to €848 million. Last year was a particularly volatile one for milk production worldwide with the price of milk dropping significantly in particular last summer, making the maintenance of profit levels especially impressive.
There is a cautionary element to the results however with net debt increasing by almost €11 million to €71.6 million.
This is related to the co-ops’s expansion of its processing campus at Castlefarm, Mitchelstown, and the redevelopment of its Mallow facility.
With EU milk quotas today finally being abolished after 31 years the sector is set to expand like a balloon in the coming years.
Irish milk production is expected to increase by some two billion litres by 2020 now that the shackles are off.
Dairygold processes almost 20% of the Irish milk pool at the moment, and its 3,000 farmers are looking to up their output by 60% over the coming years.
Things are going to be busy.
Co-op chairman James Lynch acknowledged that the end of milk quotas will offer ‘real opportunities’ and that Dairygold is ‘ready to take full advantage’.
“There are always events and challenges that will be beyond our control, but the fundamentals for the industry are sound,” he said.
Without quotas the expansion of the industry in Cork is set to create 4,000 jobs and a €450 million economic investment in Cork alone over the coming years.
Dairygold CEO Jim Woulfe still sounded a note of caution for farmers looking to expand at a rapid rate however. “Farmers should expand cautiously,” he said.
Many will have super-levies and higher investment costs to contend with if they go about things too quickly.
Prudence is to be encouraged.
Earlier, agriculture minister Simon Coveney insisted that the removal of quotas is “the most fundamental change to Irish agriculture in a generation.”
Now the shackles are off and the sector can start to realise its full potential.
It’s a great day for rural Ireland.
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Ok if farmers have it so easy try going you’re entire life without a family holiday..ever..as somebody always has to look after the farm. Try thawing frozen pipes in the depths of winter so that cattle have water. Go out on xmas day to feed them. Up in the middle of the night repeatedly during calving season. Little to no job security. All the while most people think you have it handy!
Ah yeah pull the udder one
This article is very misleading. Record profits for dairygold means little to the man on the ground. Imagine the headline “Great year for Philippine child labour as H&M post record profits”.. One bears no relation to the other. The price of producing a litre of milk is between 25 and 28 cent. The end of quotas will see the currently fluctuating price fall through the floor. Farmers will make 5 or 10 cents on the litre if lucky. If you want a laugh compare prices in 1995 to now.
Mick If it don’t pay why keep doing it…You not fooling us
Have yet to see a poor farmer
And I’ve yet to see a lazy one. They work hard for the money they earn, and their income can rely on something as fickle as the Irish weather, you can’t begrudge anyone that.
You’re clearly not an Irish farmer then
Only last year was a good one? Every year more like. Susidies galore in a controlled market with controlled production. Grants for this that and the other. I wish.
MaryLou(ny)McDonald, farmers done get Grants, they get subsidies
Perhaps Ken should pay a visit to Specsavers.
Justin…grants for drainage, sheds, farm buildings, young farmers.
http://businessetc.thejournal.ie/rural-development-plan-1551171-Jul2014/
€4 Billion in grants over next 6 years…on top of subsidies and god knows what else.
I think you should read your last post again, “grants for drainage, sheds, farm buildings, young farmers”. Can you not see the bigger picture here, its not the government handing out free money, its an investment from the government in agriculture. The larger and more efficient the farm, the more that farm produces, which means more money for the farmer, and more tax gained for the government. Compare irish farms in the 1990s before REPS, to twenty years later, there is no comparison. Its the same reason college students get grants, its the government investing in that person. The result is that a college graduate with usually earn more money, and through taxation the government makes a return on their investment.
The subsidies effect every person in Europe. Its to keep the cost of food production down. If you take away the subsidies the cost of food production increases, and you will make up the difference at the till. Compare European food prices to the United States.
Who is giving out the money so?
The subsidies come from the EU. Every farmer from a country that is part of the EU gets subsidies, its not an Irish thing.
Where does the EU get the money?
Taxes. CAP accounted for 40% of the whole EU budget in 2013, it effects every person that is a member of the EU, by keeping the price of food down.
EU gets money from national governments and then distributes it.. So the money farmers get comes from national governments who get it from taxing citizens.. So farmers do get free money.. My sector of the economy doesn’t receive state handouts and neither should farmers.. Let the free market rule and prices will be set by supply and demand. The whole agri/food sector is a false market, subsidies and controls abound.
Well its a simple question then, are you willing to take the massive increase in the cost of a basket of groceries the next time you do your shopping, and any time you buy food for that matter? You might be able to take the hit, but what about the people that cant afford to? Its a very simple concept, and has been around since 1958. Farmers are given the subsidy to reduce the cost of food production, with the subsidy, the price the farmer gets for their produce is not the true cost of production, so if you remove it, then the money paid to farmers goes up, and you pay the difference at the till. You obviously know nothing about farming or CAP if you think its “free money”. I just compared the price per KG for sirloin steak at an Irish supermarket’s online shop, to an equivalent supermarket in the United States, once the prices and weights were converted to euro and kgs, this was the results: Irish store: €14.63 per kg, US store: €23.21 per kg. The subsidies are keeping the price of food down for you, as you are not paying the true price.
Some farmers are outstanding in their fields.
Any chance other sectors of the economy could be subsidised to the extent of farming.
This is a massive deal, and will have a knock on effect on the the national beef herd as well. I will result in fewer, but much larger dairy farms going forward. It will also result in a reduced price per litre for the farmer for a few years, which will mark the end of the small dairy farmer. As a result, I can imagine lots of small dairy farms switching to beef production. This is why the deal to supply the United States with beef is so important. Its very interesting times for Irish Dairy farmers, but will mark the end of a lot of them.
didn’t mean to comment on your post! my mistake
The price of milk and dairy products in the shops should come down will all this extra output then. Not.
The farmers are cleaning up with all the grants..and allways playing poor.
you don’t understand the concept of the farming subsidies, which are there to keep the price of food down in Europe for the consumer. The subsidies are there to keep the cost of food production down, compare grocery prices in Europe to the United States and you will see a massive difference. If you remove the subsidies, the cost of food increases, as the cost of production increases.
It’s no April fool the farmers are raking in the money and a lot of them have other jobs as well….Cute hooors
I remember years ago lots of Farmers were putting on the poor mouth, firing slurry in protest. (Not accused of being sinister) and a government spokesman came on and said thousands were sitting on big grant checks for tractors.. can’t believe them after that.
A look around the big Agri shows says different also.
Not exactly correct implying that dairygold made massive profits for the previous financial year. The figures quoted represents a profit margin of only 3% which in comparsion with Kerry group’s near 10% margin put the figures in to perspective. Given Dairygold’s commodity based product mix it will be exposed to greater product price deviation post quota,challenging times ahead.
A corporations profits are not the same as a farmers profits???
April Mooools Joke?
A farmer in Leitrim told me get a herd number that’s the secret to grants and profit from renting land, and if you see any land unoccupied put your cattle and sheep on it for free grass…
It’d commonly known that farmers are the most subsidised sector in Ireland…Your on the button Jack.
correction, sector in Europe. Would you prefer no subsidies, and pay more for your weekly shop?
have your say