Co-op movement ‘serves agri-business well’

THE co-op movement has served the agri-business sector well in Ireland, which is “steeped in the co-op culture,” said Dairygold chief executive Denis Lucey.

Due to step down shortly from the post he has held since 1990, Mr Lucey reflecting on his lifetime in the agri sector opined that “agri-business in not a good ingredient for a Plc.”

“History had vindicated that reality” said Mr Lucey, without specific reference to any of the former co-operatives who went the Plc route, most of which suffered very mixed fortunes. “If you cast your eyes across Europe, the dairy sector in Denmark, Holland and further afield in New Zealand are all co-op dominated and farmers in those countries have been well served by their co-operatives,” he said.

Mr Lucey, who has been in a chief executive position for the past 20 years in the dairy sector, resisted the pressure to go public, but believes the co-op movement to be more effective has to consolidate further, as Dairygold did in the past. Prospectus was due to publish a report into the sector before the end of the year. It is not expected now until February, but Mr Lucey said he was hopeful it would prove to be the next catalyst in forging more mergers in the sector in order to create far greater efficiencies in an increasingly tougher commercial environment. He was speaking in Dublin after he was presented with the Lifetime Achievement Award from the Irish Exporters Association (IEA) presented on behalf of Bord Bia by its chief executive Michael Duffy.

The IEA award was designed by sculptor Carolyn Mulholland.

From Co Armagh, she has worked in her studios in Dublin for the past 10 years. Denis Lucey has been a central figure in the co-op movement for most of his working life.

He managed Imokilly co-op before it merged with Mitchelstown which merged with Ballyclough to create Dairygold back in 1990. Over the years, Lucey has expanded the group in Britain and the Netherlands acquiring cheese and meat operations compatible with the home base.

Group sales last year were just short of €1 billion, while operating profits were €25m.

That compares with turnover of €787m and relatively unchanged profits of 23m back in 1997.

Back in 1990 at the formation of Dairygold, the group’s sales were a much more modest €530m.

Today, Dairygold is this country’s largest farmer-owned food company.

Mr Lucey believes much more needs to be done to give the sector far greater scale thereby reducing fixed costs.