Sector ‘must explore options’

IRISH dairy processors were urged yesterday to work together to exploit the opportunities which will arise during a period of major change in the next five to 10 years.

John Tyrrell, director general of the Irish Co-operative Organisation Society (ICOS), said there is an added urgency in light of cost pressures and the need to ensure that competitors do not gain advantages.

He told the ICOS dairy conference in Portlaoise that the Irish dairy sector has a number of strengths, which it can use to create market and efficiency opportunities.

“We have an industry in which dairy producers have a major stake, is part of the European Union market and has the resources to develop in the face of the challenges ahead,” he said.

Mr Tyrrell said there have been a number of mergers, takeovers and joint processing arrangements between processors in recent years.

“It is now essential that dairy processors explore all viable options to further improve the processing and marketing efficiency of the sector. Such collaboration should cover investment, consolidation of processing for efficiency, addressing seasonality issues and product development,” he said.

Mr Tyrrell said ICOS has stated that the potential for the most efficient processing-marketing structure is in a single large-scale processor for main products — with governance and benchmark safeguards. However, in reality, regional combinations offer the prospect of early progress and can build on recent developments, he said.

Mr Tyrrell said ICOS would continue to work with co-ops and processors to facilitate discussions to develop the sector.