Ornua is to invest €250m in overseas acquisitions from now to 2020 developing markets for Ireland’s soaring post-quota milk output.
The marketing body for Irish dairy has spent €200m in the past six years on mergers and acquisitions in key target markets. Ornua recently acquired Ambrosia Dairy, its first manufacturing base in China.
Ornua has also opened a new €20m cheese manufacturing facility in Riyadh, Saudi Arabia. The facility will produce white cheeses for the Saudi Arabian market, one feature of which will be a pilot kitchen built at Teagasc Moorepark and shipped to Saudi Arabia.
“Developing new products for target markets is key to our strategy,” said Jeanne Kelly, Ornua spokesman. “New products now represent 12% of our overall sales; that will grow to 20% in the next year.
“Saudi Arabia is a great example of where the science behind new product development is meeting commercial very successfully. Two years ago, our business development people identified Saudi as a great opportunity. It is the fifth largest dairy importer in the world, a huge market for white cheese products.”
The new Saudi facility will use pioneering technology developed by Ornua and Teagasc to produce bespoke fresh white cheeses for the increasingly sophisticated bakery sector, retail delicatessens and food service customers.
White cheeses are hugely popular in the Middle East and North Africa. Working with Ornua and its Saudi partner Al Wazeen, Teagasc’s technology will allow milk ingredients to be recombined for fresh white cheese production.
“In Saudi, people have white cheese with most meals,” said Jeanne Kelly.
“In the morning, in fast food restaurants you’ll see flat breads with a range of seasoned white cheeses for breakfast. And you’ll see some form of white cheese with every meal.”
This Saudi example was one of a series of projects outlined by Ornua chief executive Kevin Lane, and his team to the 600 international dairy scientists at Teagasc’s three-day IDF Symposia in Dublin, which ends today.
Yesterday, Ornua also said it is to suspend its monthly milk supplier levy from May 1, in response to the difficulties faced by dairy farmers due to the dairy market downturn.
In 2016, it is estimated that the suspension will return nearly €6m to Irish dairy farmers. Ornua will reconsider the suspension of the milk levy when the Ornua Purchase Price Index again returns to 103 (30.5 cpl including Vat) for three consecutive months.
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