Farm Ireland
Independent.ie

Wednesday 18 October 2017

GII plan €8m spend in Cavan

Darragh McCullough

Darragh McCullough

Glanbia Ingredients Ireland (GII) is set to expand in both the northeast and southeast over the coming months, with multiple announcements from the processor over the past week.

The processor's Virginia, Co Cavan plant is set to receive a €9m investment over the coming months to build a milk protein concentrate unit.

Production is expected to commence in early 2015 and the output will be targeted at medical nutrition markets across Asia, the Middle East and Africa.

"We installed our first milk protein concentrate unit in Ballyragget three years ago and that has opened up doors for us into very valuable niche markets that are increasingly looking to dairy for their protein requirements," said GII's strategic development director, Sean Molloy.

"Because these markets are very specialised there are very high barriers to entry, which makes it difficult for competitors to come into this space."

While this unit will not significantly increase the overall milk-processing capacity of the Virginia plant, Mr Molloy stressed that it would displace some of its enriched milk powder (EMP) production to the new site in Belview.

"This is another huge growth sector for us, especially in markets such as West Africa," he said.

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"I expect sales to increase by 30-40pc over the next five years into eight West African countries that we are targeting where GDP growth is averaging between 5-8pc.

"These are great countries to be established in because they are stable, with their currencies linked to the euro and legal systems based on the French system," Mr Molloy added.

GII currently sell 15,000-20,000t of EMP into West Africa annually. A 40pc increase would result in demand for an extra 48m litres of milk.

In addition, GII's main customer for milk fats, Diageo's Baileys, is projecting annual growth of 10pc for the coming years, with an aggressive ramping up of advertising around the brand to its core female audience.

"It's a perfect match having growing markets for both parts of the litre of milk," said Mr Molloy.

These developments come hot on the heels of the news that GII has signed an agreement with Wexford Milk Producers to buy out Wexford Creamery.

The price that was tabled by GII for the processor is due to be circulated to the 320 Wexford suppliers in the next two weeks.

Wexford Creamery produces 15,000t of cheese annually from milk supplies of 110m litres.

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