FDBusiness.com

Northern Ireland’s dairy industry must aim for greater supply chain co-operation, more efficient farms and more added value products, according to a competitiveness study just published. The ‘Northern Ireland Dairy Industry Competitiveness Study’, which was undertaken by Promar International and jointly funded by the industry, DARDNI, and Invest NI, has been welcomed by Dairy UK (Northern Ireland).

The report looks at the future of the NI dairy industry after milk quotas are abolished by the EU in 2015, and outlines the challenges that the sector will face, as well as detailing potential options for the industry.

Dairy UK (NI) chairman, Paul Vernon says: “This is an important report for the NI dairy industry. We know that there will be changes to the CAP over the next few years that will have a significant impact on our industry. This report is an attempt to identify these changes, and suggest strategies that will help ensure that we continue to have a profitable dairy industry in Northern Ireland. The nature of a report such as this is that there will be certain aspects with which not everyone will agree. It is my hope, and that of the Dairy UK (NI) Board, which includes the Ulster Farmers’ Union, that the report will act as a prompt to discussion, and a catalyst for action as our industry faces a challenging decade.”

Some of the recommendations of the report include:

* The dairy supply chain should improve its economies of scale in primary production and processing to achieve lower unit costs, and contribute to improved competitiveness.

* Within the next decade, the industry should aim to have a NI milk pool of at least 2 billion litres per year.

* Existing co-operation at processing level should be developed to enable milk to be manufactured into products that will provide the best returns from markets.

* There should be planned, and sustained investment in R&D to add value to dairy products; to lower costs of producing milk; to improve milk quality; to improve processing efficiency; and to improve packaging.

* The energy costs of the supply chain need to be reduced by 25% over the current decade to make it competitive with other regions of UK and other competitor countries.

“Some of the changes that are needed lie within the remit of individual business owners – at both farm and processing levels – while other challenges must be dealt with at industry level,” comments Dr Mike Johnston, NI director of Dairy UK. “It is our intention to establish an implementation group that is representative of the dairy supply chain, and that will develop those aspects of the report that relate to industry level issues. This group will be responsible to the Board of Dairy UK (NI).”