milk processing

keep going

what do you think is the way forward pre 2015 and post.where should the milk be processed,into what and by whom.how should it be sold.how will developments be financed.how much extra will be produced and where

John_F

at moorepark last week :rolleyes: shalloo was saying that they compared costings of spreading the milk input to flatten it off abit with building more steel, and the cost of flatening the milk curve would reduce farm profit by €115m for everyone in the country to go from 100 spring to 50 50 autumn spring but a gain of €49m at processor level. . . . suggesting we should follow spring calving, but who sets the rules like, as for who will pay. . . in my opinion youl be given a certain time to expand (prob wont be told) and when the processor reaches the max at peak then youl have to buy to supply really making it uneconomical to expand. . . this is what fonterra do as far as i know, each farmer has 1 share for every kg of milk solid sold from previous year and if they go over that for a year they must buy shares, and if fonterra dont want the milk (might know price will be poor, market poor or there will be over supply) they push up the share price way over what the milk would make in a year eg milk payment of $7 per kg milk soild and share price of $12 and visa versa if they want farmers to drive on.

but knowing ireland the processors will prob try to push the uk route and flatten the milk curve. although carbery and dairy gold can handle more milk at peak i dont think kerry or glanbia are ready. we really need to consolidate the whole milk processing though, we sell product to customers all over the world through the irish dairy board and the companies supplying idb are also their competitors

dont forget alot could happen between here and post 2015, compare 2007 with 2009!

whelan1

how many other countries have as many creameries as us , there is alot of rationalisation to be done there , too many people getting too much wages etc before the farmer gets anything

JohnBoy

My father worked in the dairy industry all his life and was against rationalisation for the sake of it.

He'd question how much better price did the farmers of avonmore and waterford get following the merger to form glanbia.

Look at the milk price leagues and see who's paying the best prices.

The reality is that while bigger co-ops gain economies of scale they also create bigger corporate structures to manage them which simply move the costs from one part of the business to another.



Modern thinking tells us that to get the most from our plant we should run it as much as possible, I was both surprised and impressed with teagasc's study into the cost of milk processing. sometimes it is cheaper to create more capacity and simply mothball it for part of the year the accountants wont like it but it might make sense.

whelan1

look how many wages are paid to the all the top knobs in all these creameries , how many boards are there , money totally wasted.... my da was heavilly invovled in co-ops over the years and always said the waste there is unreal , trips to america etc , stupid votes like last year , where millions was wasted , while farmers struggled to keep their heads above water... just look at the price league in the journal , for a country our size its a total joke to have so many processors

JohnBoy

Agree, but if you take two smaller co-ops and merge them it's the lads in the factories, or the truck drivers that'll be let go. and now that they're managing a much bigger organisation the boys at the top will pay themselves more, cancelling out any savings.


If the four west cork co-ops for example merged in the morning you can be sure they'd cut management/board/committee numbers by at most 25% from their current levels.

Co-ops are often a step away from the public sector in terms of inefficiencies, but merging inefficient companies rarely makes for more efficient ones, just bigger inefficient companies.

Tipp Man

JohnBoy wrote: »

Agree, but if you take two smaller co-ops and merge them it's the lads in the factories, or the truck drivers that'll be let go. and now that they're managing a much bigger organisation the boys at the top will pay themselves more, cancelling out any savings.


If the four west cork co-ops for example merged in the morning you can be sure they'd cut management/board/committee numbers by at most 25% from their current levels.

Co-ops are often a step away from the public sector in terms of inefficiencies, but merging inefficient companies rarely makes for more efficient ones, just bigger inefficient companies.

But thats what we need, we need factory workers and/or truck drivers left go. The average wage at Glanbia 5 or 6 years ago was 55k which is more than the majority of its suppliers were making

Currently we have what 28 coops with 28 boards and all the other rubbish that goes with it. The cost of 28 boards alone is huge - nevermind all the costs for running them as individual companies

We need 2 or max 3 coops to get some serious rationalisation once the milk leaves the farm gate. Probably Glanbia, Kerry and Dairygold will be the 3 that cut it. There might be a couple of small coops in Cork. We are going nowhere until this rationalisation happens

5live

The west cork co-ops have a superb model for milk processing. They co-operated (possibly something more co-operatives could think of doing;)) and built a fantastic efficient processing plant. All the profits go back to farmers which isnt necessarily true of most co-ops and definately isnt in PLCs.

Kerry has processing capacity to process 20% more at peak and farmers will be allocated a 'quota' (now werent they supposed to disappear in 2015:rolleyes:) of their 2015 milk VOLUME plus 20% which is held for 2 years but lost if it isnt filled. Nobody will tell me what happent to the lost quota or who will recieve it (no surprise there then). And the other co-ops who supply milk to newmarket at peak will find it a problem very soon to process that milk as kerry will use own milk first.

Also is there really going to be that big an increase in milk? You are probably looking at a minimun of 2.5k of costs of on farm inversment before 1200 gallons sent in and then add on the cost of paying for the stainless steel quota. All achieveable, i suppose, at 33c a litre but long term is that a sustainable price?

jeff greene

Can the dairy farmers here give an idea of their realistic expansion aims. We're milking 70 this year, have 60 heifers( calves + incalf). I have facilities for that many, parlour could take a few more rows, tank is big enough for about 90 @ 6.5gallons/day.Grazing land is maxed out with feed going in all year round practically.

While spring calving is obviously the better system, a flatter supply would suit me if it stacked up financially, milk ayr, sent dry cows off for the summer etc. Maximise my current facilities.

Is all this new milk really going to come from new entrants, I know dairy farms in different parts of the country are raging to go, but here, I'm not so sure they can.

John_F

JohnBoy wrote: »

My father worked in the dairy industry all his life and was against rationalisation for the sake of it.

He'd question how much better price did the farmers of avonmore and waterford get following the merger to form glanbia.

Look at the milk price leagues and see who's paying the best prices.

The reality is that while bigger co-ops gain economies of scale they also create bigger corporate structures to manage them which simply move the costs from one part of the business to another.



Modern thinking tells us that to get the most from our plant we should run it as much as possible, I was both surprised and impressed with teagasc's study into the cost of milk processing. sometimes it is cheaper to create more capacity and simply mothball it for part of the year the accountants wont like it but it might make sense.

yes but you cant compare avonmore and waterford model with a glanbia model, glanbia being a plc must drive profit to its share holders and when it is a plc these can be farmers or fellas in offices in Dubai! having alot of small coops is inefficient and all going against each other for the same market place under cutting each other. if there is a merger it CANNOT be towards a plc model, the coop model must stay, the 4 west cork co-ops (carbery) pay a good price because they are involved in value added products (cheese, whey protein, vodka, flavours etc) as opposed to the general whole milk powder and butter. one or a few bigger coops would create more efficiencies as there is the one r&d team, one marketing team etc that are all going the same direction. did anyone get the icmsa newsletter last week? page 9 says about supply contracts and how it may not be good for farmers at all, and the coop may force the farmer to reach targets such as 12 mini quotas for the year and a penalty for each month you are over (glanbia model??)! if we go that route then the focus on being a relativly cheap producer of milk goes out the window. hopefully some good will come from fonterra talking about joint venture with irish coops so we can hold on to producing the way we are.

my point on the costings was that it is cheaper for the processor to spread out the milk and not build new of course but it will cost farmers alot of money to do so (not sure what milk price they used though and if there was any bonuses for winter months etc)

John_F

jeff greene wrote: »

Can the dairy farmers here give an idea of their realistic expansion aims. We're milking 70 this year, have 60 heifers( calves + incalf). I have facilities for that many, parlour could take a few more rows, tank is big enough for about 90 @ 6.5gallons/day.Grazing land is maxed out with feed going in all year round practically.

While spring calving is obviously the better system, a flatter supply would suit me if it stacked up financially, milk ayr, sent dry cows off for the summer etc. Maximise my current facilities.

Is all this new milk really going to come from new entrants, I know dairy farms in different parts of the country are raging to go, but here, I'm not so sure they can.

maxed out for land here at 100 cows, ayr can be tough going too jeff like trying to feed cows at all different stages of lactation, cows calving off grass, harder to manage individual cows as opposed to large groups, i think it will all come down to price, if a new entrant starts off and ticks away over at 30 cent a litre then there prob will be extra milk but if we go back down to below mid 20s then alot of fellas will be in trouble!

jeff greene

John_F wrote: »

maxed out for land here at 100 cows, ayr can be tough going too jeff like trying to feed cows at all different stages of lactation, cows calving off grass, harder to manage individual cows as opposed to large groups, i think it will all come down to price, if a new entrant starts off and ticks away over at 30 cent a litre then there prob will be extra milk but if we go back down to below mid 20s then alot of fellas will be in trouble!

Yeah I know but except for big investment which I'm not keen on atm, ayr is an option, as I say only if viable.

JohnBoy

Tipp Man wrote: »

But thats what we need, we need factory workers and/or truck drivers left go. The average wage at Glanbia 5 or 6 years ago was 55k which is more than the majority of its suppliers were making

But my point is that what happens in reality is the drivers are let go and the saving is spent at management level. It never translates into a better price to the farmer.

It should, but it never seems to actually happen.

Currently we have what 28 coops with 28 boards and all the other rubbish that goes with it. The cost of 28 boards alone is huge - nevermind all the costs for running them as individual companies

Let's say there's 10 members on each of those boards, so 280 in total.

lets also say they merged into 1 mega co-op.

How many board members do you think you'll be left with? I'd be shocked if it was less than 200. We have a history of over-representation in this country, at every level, and when the time comes very few politicians (and that's what these board members are, very local politicians) will vote themselves out of a job.


To look at west cork again, no-one down there wants a merger, they can all keep their comittees and boards and all that because they created carbery instead, a standalone jointly owned entity. Much easier than the politics of merging.

We need 2 or max 3 coops to get some serious rationalisation once the milk leaves the farm gate. Probably Glanbia, Kerry and Dairygold will be the 3 that cut it. There might be a couple of small coops in Cork. We are going nowhere until this rationalisation happens

I would disagree. we have no need for fewer co-ops, we may have a want for it. what we have a need for is rationalised processing capacity, and I would suggest some competion for milk wouldnt be a bad thing either

whelan1

look at strathroy... big volumes in simple plant big volumes out , no crap... fresh milk , low fat and cream- they are doing the business , we mightnt like it down here but thats the reality.... any one of us could go out and buy 50 acres and start a plant up tomorrow and sell milk at low cost... its the management and boards that take alot of the money

whelan1

would have enough land for 300 cows but need money:D have 150 atm - have 75 replacements cooking at the minute

Tipp Man

JohnBoy wrote: »

But my point is that what happens in reality is the drivers are let go and the saving is spent at management level. It never translates into a better price to the farmer.

It should, but it never seems to actually happen.



Let's say there's 10 members on each of those boards, so 280 in total.

lets also say they merged into 1 mega co-op.

How many board members do you think you'll be left with? I'd be shocked if it was less than 200. We have a history of over-representation in this country, at every level, and when the time comes very few politicians (and that's what these board members are, very local politicians) will vote themselves out of a job.


To look at west cork again, no-one down there wants a merger, they can all keep their comittees and boards and all that because they created carbery instead, a standalone jointly owned entity. Much easier than the politics of merging.




I would disagree. we have no need for fewer co-ops, we may have a want for it. what we have a need for is rationalised processing capacity, and I would suggest some competion for milk wouldnt be a bad thing either

How on earth can you have a board of directors of 200 people?? Maximum would be 20 (at the very most)

I'm not saying that mergers and rationalistation would definately lead to higher farm milk prices but it increases the chances of it happening.

What exactly is competition for milk?? Kerry and Glanbia competing to buy my milk or Kerry and Glanbia competing against each other to send powder to South America?

Tipp Man

Currently milking 98. Enough land on the home place to milk 130 fairly easily.

could convert the beef farm fairly easily as well to milk another 150 but unlikely to do that - certainly not till the dust settles post 2015

whelan1

one of the major problems with glanbia is there has never been a big cull of all the dead weight... multply this by the 28 processors and there in lies your problem....also there should be a rule that no person can stay on a board longer than 10 years , this give a good chance for new blood and gets rid of stragglers in their 80's - i am not ageist by the way

blue5000

I got out of dairying a few yrs back but after reading the thread there has to be changes at processer level, we should let fronterra in to shake everyone of them up.

The plcs don't give a sh1te about the farmers milking the cows. There is unbelievable waste going on in all the processers, the farmers are paying for this, no way should farmers switch to ayr milking.

Grass is our big advantage, we should work with NZ so that between us we can produce cheap milk all year round, and sell it worldwide.

This is probably a crazy idea;

But I wonder would it be possible to build a powder plant on a ship, put it in cork harbour for our peak months april to july, then sail it to NZ for their peak months in our winter?:)

JohnBoy

Tipp Man wrote: »

How on earth can you have a board of directors of 200 people?? Maximum would be 20 (at the very most)

That's my whole point, it's madness, but that's what would happen.

that's pretty much what has happened in every co-op merger in the history of the Irish co-ops.

They never truly rationalise, they just merge.



in competion I mean kerry and glanbia competing to buy your milk.


Blue5000's idea is genius, but probably not viable genius

Tipp Man

JohnBoy wrote: »

That's my whole point, it's madness, but that's what would happen.

that's pretty much what has happened in every co-op merger in the history of the Irish co-ops.

They never truly rationalise, they just merge.



in competion I mean kerry and glanbia competing to buy your milk.


Blue5000's idea is genius, but probably not viable genius

If there are 1 or 2 super coops then there will be adequate boards to match so that means 10 man boards per coop. There will not be a few hundred on the boards

Regarding competition for milk - I don't think in my lifetime (I'm in my 30's) will i ever see Irish coops competing against each other for milk, they simply don't have to and won't have to.

Reading the journal a few weeks ago and the guy who bought Castle Anneagh in Kilkenny, He was bringing a 150k gallon quota with him from Cork to milk with the existing 180k Glanbia quota, and guess what Glanbia refused to merge the quota. He now has Glanbia collecting the existing milk 1 day and Wexford Coop collecting it (the Cork quota) the other day. And this was a yard with 500 cows. Glanbia have no interest in expanding their milk supply and have no intention in this world of ever competing with any Irish coop for milk.

I agree with that the West Cork Coops have the right idea as they (the farmers) own and control the operations. That was shot down in Glanbia this time last year. Will that can of worms be reopened again? I believe it will and I think this time the split will go ahead (probably on better terms)

JohnBoy

What you're saying is what should happen. what I'm saying is what (I think, based on history) will happen.

John_F

JohnBoy wrote: »

But my point is that what happens in reality is the drivers are let go and the saving is spent at management level. It never translates into a better price to the farmer.

It should, but it never seems to actually happen.



Let's say there's 10 members on each of those boards, so 280 in total.

lets also say they merged into 1 mega co-op.

How many board members do you think you'll be left with? I'd be shocked if it was less than 200. We have a history of over-representation in this country, at every level, and when the time comes very few politicians (and that's what these board members are, very local politicians) will vote themselves out of a job.


To look at west cork again, no-one down there wants a merger, they can all keep their comittees and boards and all that because they created carbery instead, a standalone jointly owned entity. Much easier than the politics of merging.




I would disagree. we have no need for fewer co-ops, we may have a want for it. what we have a need for is rationalised processing capacity, and I would suggest some competion for milk wouldnt be a bad thing either

youd prob have a board and then a share holders council which would have a chair etc that would deal with the board.

fonterra has 13 on their board of directors http://www.fonterra.com/wps/wcm/connect/fonterracom/fonterra.com/Our+Business/Fonterra+at+a+Glance/Board+of+Directors/

8 on the exec committee http://www.fonterra.com/wps/wcm/connect/e2796600453f04d796adde9a8f155673/structurearticlefinal.gif?MOD=AJPERES

35 on share holders council http://www.fonterra.com/wps/wcm/connect/fonterracom/fonterra.com/our+business/fonterra+at+a+glance/about+us/our+structure

http://www.fonterra.com/wps/wcm/connect/fonterracom/fonterra.com/Our+Business/Fonterra+at+a+Glance/Shareholders+council/

and 1 milk commisioner to liase with all the groups. this is a companie that processes more milk than ireland produces but up to the 1990s they only had 4 coops, now they have 2 large coops and a few plc models such as synlait.

we dont need one super coop as they would have a monopoly really and it is good to keep the pressure on from another business, but you must ask who are we competing against, it should be a relay race not a glory race!




(appologies for all the links :pac: but this is the stuff i was on about we should learn from nz )

Tipp Man

John_F wrote: »

youd prob have a board and then a share holders council which would have a chair etc that would deal with the board.

fonterra has 13 on their board of directors http://www.fonterra.com/wps/wcm/connect/fonterracom/fonterra.com/Our+Business/Fonterra+at+a+Glance/Board+of+Directors/

8 on the exec committee http://www.fonterra.com/wps/wcm/connect/e2796600453f04d796adde9a8f155673/structurearticlefinal.gif?MOD=AJPERES

35 on share holders council http://www.fonterra.com/wps/wcm/connect/fonterracom/fonterra.com/our+business/fonterra+at+a+glance/about+us/our+structure

http://www.fonterra.com/wps/wcm/connect/fonterracom/fonterra.com/Our+Business/Fonterra+at+a+Glance/Shareholders+council/

and 1 milk commisioner to liase with all the groups. this is a companie that processes more milk than ireland produces but up to the 1990s they only had 4 coops, now they have 2 large coops and a few plc models such as synlait.

we dont need one super coop as they would have a monopoly really and it is good to keep the pressure on from another business, but you must ask who are we competing against, it should be a relay race not a glory race!




(appologies for all the links :pac: but this is the stuff i was on about we should learn from nz )

I see no reason why we can't have exactly the same structure here in Ireland for 2 or 3 coops.

I think that somebody needs to establish a template for the future of Irish Dairy's, sit the 28 boards down and say this is where we are going - get us there as fast as is reasonably possible. Question is who is that somebody?

Is the will really there though to drive these changes? Personally i don't think so

So we lack a leader, we lack a definite plan and we lack will - it could be a very long road ahead

Tipp Man

JohnBoy wrote: »

What you're saying is what should happen. what I'm saying is what (I think, based on history) will happen.

I hear what you are saying (and history backs you up of course) but i have a feeling that if something big does happen then i think there will be a fair bit of rationalistation and there is a chance it will be done properly this time

keep going

here in west cork the big problem is land access.most fellas have almost maxed out their home blocks that said i would expect most could produce 25-30% extra with some fellas doubling or more.the annoying thing about west cork is dairy farmers tend to cluster but if you could get the right people in the right farms it could really go.id be confident of at least 50% by 2020 and would er on the up side,but it would be price dependant.alot of fr stock coming on line around here.in my own case its totally dependant on land access and am set up to at least treble(easier said than done). i dont know how many new entrants will be there given the amount of capital and commitment, but the more the merrier as it will lift the economy of west cork.and fellas wont go at it except they see us making money.as regards processing model i think we have to get one thing into our head QUOTAS ARE GOING so lets maximise current processing through sharing agreements and put processing where you need it.rather than a complete new plant i think it will be done through adding on to existing setups on a user pays model

Tipp Man

keep going wrote: »

here in west cork the big problem is land access.most fellas have almost maxed out their home blocks that said i would expect most could produce 25-30% extra with some fellas doubling or more.the annoying thing about west cork is dairy farmers tend to cluster but if you could get the right people in the right farms it could really go.id be confident of at least 50% by 2020 and would er on the up side,but it would be price dependant.alot of fr stock coming on line around here.in my own case its totally dependant on land access and am set up to at least treble(easier said than done). i dont know how many new entrants will be there given the amount of capital and commitment, but the more the merrier as it will lift the economy of west cork.and fellas wont go at it except they see us making money.as regards processing model i think we have to get one thing into our head QUOTAS ARE GOING so lets maximise current processing through sharing agreements and put processing where you need it.rather than a complete new plant i think it will be done through adding on to existing setups on a user pays model

Quotas are going in name but what is going to replace them?? Glanbia for instance has no capacity and it is the largest coop, I think Dairygold is very limited also and it's the second largest.

I don't think 2015 will see the floodgates open and it being a complete free for all as some believe. Coops will implement their own quota system

And that might not necessarily be a bad thing for farmers - have we the markets for all this extra milk? I know world markets are growing but we need to be the country that graps it - that is far from certain IMO

keep going

i take it even from our very unscientific survey that their is potential for alot more milk(wont waste time wondering how much).question for glanbia suppliers which is more important extracting max value for your share or expanding processing. there seems to be a conflict there which will mean that may not be any/a large expansion of processing because milk processing in ireland does not deliver a good roi so why will the plc invest.wexford seem to be positioning them selves nicely but are in for a couple of lean years.lakeland seem to be working hard enough at the moment just to keep going but may be they could sweep up extra supply from outside(have they capacity?).are the connaught coops worried about future supply and are they in the wrong business for their suppliers?.i think they are ok for processing cap.what about kerry, they now have good capacity but what is their strategy.dairygold are dragging them selves back into position and are in the great position of being the piggy in the middle and some scale.downside of that seems to be they dont know what to do either.and ourselves have sqaundered our riches on bad investments and poor diversification during the 30 years of quota confinent.we probilly have people from most coops on here so tell us what you think the story is with you crowd and what your coop should do, not generalisations

stanflt

a new processing plant will have to be built- in the centre of the country-processing milk on contract for all the different co-ops etc

all milk will all be paid on a&b-c

heres the catch

the processing charge(-c) will be much greater for summer milk production to encourage more winter milk to make processing plants more efficient

funny man

• Dairygold and Glanbia to do a joint venture on new 20ton/hr dryer
• Kerry 25%plus
• Lakeland 30% with options to process more as donegal suppliers goto CGold
• CGold under20%

the rest i'm not sure about but capacity is not going to be the limiting factor despite what people think, it will all come down to margins both at farm and processing level, what we need to understand that all new milk will go into bog standard commodities and that the returns from that product will be very vulnerable to price fluctuations so this must be produced cheaply from grass, flatting the milk curve is fanciful bullsh!t and should be shot down where ever it's mentioned just as the CE of Dairygold did when it was raised by a former IFA leader in moorepark.

The markets are there but we are too small, too fragmented as an industry to muscle our way to be supplier of choice by major food companies, that is why so many baby food manufacturers set up operations here; many suppliers to chose from. Now the big guns are looking for some action as Arla moves into London and Fonterra is sniffing around for a chance to take over possibly a large British dairy our boys will have to sit up and take notice because if they don't they will end up supplying product under a fonterra/Arla or other outside brand name into the market and that will be a sad day for the Irish Dairy industry.

keep going

stanflt wrote: »

a new processing plant will have to be built- in the centre of the country-processing milk on contract for all the different co-ops etc

all milk will all be paid on a&b-c

heres the catch

the processing charge(-c) will be much greater for summer milk production to encourage more winter milk to make processing plants more efficient

this new plant,who is going to own it,who is going to finance it,what will it produce,where will the milk come from, who is going to do it, what size will it be. not picking holes just fill out you solution.

keep going

funny man wrote: »

• Dairygold and Glanbia to do a joint venture on new 20ton/hr dryer
• Kerry 25%plus
• Lakeland 30% with options to process more as donegal suppliers goto CGold
• CGold under20%

the rest i'm not sure about but capacity is not going to be the limiting factor despite what people think, it will all come down to margins both at farm and processing level, what we need to understand that all new milk will go into bog standard commodities and that the returns from that product will be very vulnerable to price fluctuations so this must be produced cheaply from grass, flatting the milk curve is fanciful bullsh!t and should be shot down where ever it's mentioned just as the CE of Dairygold did when it was raised by a former IFA leader in moorepark.

The markets are there but we are too small, too fragmented as an industry to muscle our way to be supplier of choice by major food companies, that is why so many baby food manufacturers set up operations here; many suppliers to chose from. Now the big guns are looking for some action as Arla moves into London and Fonterra is sniffing around for a chance to take over possibly a large British dairy our boys will have to sit up and take notice because if they don't they will end up supplying product under a fonterra/Arla or other outside brand name into the market and that will be a sad day for the Irish Dairy industry.

it does look like some link up between DG and glanbia would make sence . is there anyone considering a new start up in ireland?why not if there is so much potenial. surely frontera would have the money and the know how to start a new plant.should we forget about alot of this branding and stick to the basics but become very efficient at it.selling your own products tends to eat margins and im not sure it ends in a better milk price.

Bitten & Hisses

JohnBoy wrote: »

I would disagree. we have no need for fewer co-ops, we may have a want for it. what we have a need for is rationalised processing capacity, and I would suggest some competion for milk wouldnt be a bad thing either

I would agree with you on this and also on the whole likelihood of over-representation on boards. The parish pump comes before all else and none of the power brokers (as they may see themselves) on the board of some inconsequential little co-op won't want to relenquish their grasp on that power. There was a rumour in the Journal earlier this year of a merger between 2 small co-ops in Cork and it was thrown out without discussion at one of their board meetings.

Rationalisation for the sake of it is not the way to go, nor is it a magic solution to somehow getting a great price per litre. However, there are potential synergies and these would need to be evaluated on a case-by-case basis. It would be a monumental achievement to reduce manufacturing cost by 1 cent/Litre purely as a result of rationalisation and cutting headcount. Plus, you have no guarantee that you'll end up with the best possible board or management in a merged co-op.
My point is, mergers and rationalisation will have their place, there is certainly plenty of dead wood to remove, but the owners of these businesses need to tread carefully to avoid repeating the mistakes of the past.

funny man

keep going wrote: »

it does look like some link up between DG and glanbia would make sence . is there anyone considering a new start up in ireland?why not if there is so much potenial. surely frontera would have the money and the know how to start a new plant.should we forget about alot of this branding and stick to the basics but become very efficient at it.selling your own products tends to eat margins and im not sure it ends in a better milk price.

All the big guys are looking at us but purely to source cheap commodity product at the moment, Fonterra are in the country at the moment on a fact finding mission, their view is they would prefer to buy out a processor with a supplier base rather than build a plant and try to attract milk, watch this space. no we shouldn't forget brands and marketing as the IDB are excellent at this and in my view should get more product, but their position is compromised by the fact that most of the Chief Executives sit around it's board table and then sell against them when they leave with the information received, selling our own product is very much like getting a cattle dealer to sell your cattle privately:rolleyes: need i say any more.

keep going

funny man wrote: »

All the big guys are looking at us but purely to source cheap commodity product at the moment, Fonterra are in the country at the moment on a fact finding mission, their view is they would prefer to buy out a processor with a supplier base rather than build a plant and try to attract milk, watch this space. no we shouldn't forget brands and marketing as the IDB are excellent at this and in my view should get more product, but their position is compromised by the fact that most of the Chief Executives sit around it's board table and then sell against them when they leave with the information received, selling our own product is very much like getting a cattle dealer to sell your cattle privately:rolleyes: need i say any more.

i was not clear about selling our own product.what i mean is taking products all the way to the supermarket shelf(consumer service).any of the companies involved in that in ireland do not pay the best price.carbery have dubliner and the amount of money pumped into marketing it(250k and growing) for moving 1200 tons of cheese a year,its not a gold mine.as regards the idb,if they are doing a good job(generating a higher return for our milk)why do companies sell outside of it.it dosent make sense.surly coops want to get the highest price for their produce and if they can get a higher price outside of it then the idb is not doing a good job

funny man

keep going wrote: »

i was not clear about selling our own product.what i mean is taking products all the way to the supermarket shelf(consumer service).any of the companies involved in that in ireland do not pay the best price.carbery have dubliner and the amount of money pumped into marketing it(250k and growing) for moving 1200 tons of cheese a year,its not a gold mine.as regards the idb,if they are doing a good job(generating a higher return for our milk)why do companies sell outside of it.it dosent make sense.surly coops want to get the highest price for their produce and if they can get a higher price outside of it then the idb is not doing a good job

IDB sell butter under the Kerrygold brand and they also sell cheese under the Dubliner brand and they are quite sucessful at it, Most co-ops sell alot of their products cheese,butter and powder through the IDB but they also hold back some product to sell on spot price as opposed to contracts with the IDB this allows them to command a higher price at times but this also pits co-op against co-op and this reduces the price paid for the milk.

Pauric Mc

lakeland have some scope for expansion, all the drying is done in baileboro but they can still use kilashandra and lough egish. But as was mentioned earlier they also have a huge problems with way to many clowns all doing the same job in offices. nothing!!