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Tuesday 18 September 2018

Dairy sector must move to GM-free feed to protect its global presence - Glanbia boss

Minister Michael Creed at the re-opening of Glanbia Ireland's Wexford cheese plant. Photo: Patrick Browne
Minister Michael Creed at the re-opening of Glanbia Ireland's Wexford cheese plant. Photo: Patrick Browne
Louise Hogan

Louise Hogan

The Irish Dairy industry needs to move towards delivering produce free from genetically modified feedstuffs to consolidate its presence in key markets, a top dairy executive has warned

However, Glanbia Ireland chief executive Jim Bergin has also cautioned that only some consumer markets would pay a premium for GMO-free butter, cheese and milk.

"In Europe, there is the VLOG standard and that is a very, very challenging standard, and for us to achieve that in Ireland, there would have to be a significant change to the supply chain," he said, as Glanbia Ireland launched a €35m revamp of its Wexford cheese plant.

"That is a big step but at the moment, it would seem like if we are to compete successfully in Germany, we are going to have to take that step, simple as that."

Ornua, which has a strong presence in Germany with the popular Kerrygold butter brand, has already flagged that it is competing against dairy produce marked GM-free on shop shelves. Centenary Co-op in Thurles has recruited a number of suppliers whose cows are not fed GM animal feed. Figures have also shown that close to 1.7 million tonnes of GM soya and maize were imported last year, accounting for more than half of feed imports.

Mr Bergin said the move to GM-free feedstuff would defend prime markets and also boost expansion.

He acknowledged the biggest issue was the importation of protein elements of rations on non-GM ships.

He said there was no doubt that this would bring added costs for farmers but they hoped to "create more value from it in additional markets and be able to pass that back". He also pointed out the importance of maintaining Ireland's grain industry which delivers non-GM grains.

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ICMSA president Pat McCormack said that Irish dairy farmers were well placed to provide the produce but the market would have to pay the additional costs associated with it.

Mr McCormack said that for too long, farmers have been asked to "take on board more and more standards and conditions with zero reward" from the marketplace. "If they want additional conditions, they are going to have to pay for it," he said.

Trade wars

At the Wexford cheese plant launch, Mr Bergin said the "sober element" of it was that the €111m paid out from the plant had already slumped by 15pc, or €17m due to sterling depreciation, before Brexit kicks in.

Mr Creed said Ireland was now trading in a challenging international environment, with talk of 'trade wars' from the US White House. Glanbia also confirmed the Enterprise Ireland supported €160m investment to deliver a third dryer at Belview in Co Kilkenny would go ahead.

Mr Bergin said it was vital that such investments were delivered on time, as by March of next year, the Co Kilkenny plant will have to process 34 million litres of milk a week due to the level of expansion.

He said they want to move further up along the chain towards delivering a finished infant formula powder at the plant. However, he acknowledged there were high barriers to entering the demanding market but the aim was ultimately to "can our own product".

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