To characterise the current row between Tirlán and Ornua as a war on butter is an understatement. By taking on the Costco contract to supply cheap Irish butter to the United States, Tirlán is striking a low blow at Ornua. The ironic thing is, Tirlán is the largest shareholder in Ornua, holding about 40% of the shares.

A good partnership aims to create win-wins for both parties but partnerships suffer when one party tries to win at the expense of the other. However, in this case it seems to me that Tirlán is creating a lose-lose situation for everyone.

Irish butter, under the Kerrygold brand, is a widely recognised premium product in the US, and for that it commands a premium price. By supplying the Costco own brand butter, that premium is not being captured and this butter is undercutting Kerrygold as it is being sold for about $6 (€5.30) less per pack. The 90 million or so Costco shoppers in the US will therefore be faced with a choice; pay more for premium Irish butter, or pay less for premium Irish butter.

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It’s not as though we are comparing own brand supermarket cornflakes to Kellogg’s cornflakes, they are very similar products. Is it any wonder therefore that Kerrygold is already being de-listed in many Costco stores?

Tirlán is clearly dissatisfied with the performance of Ornua and has been for some time, but attacking the Kerrygold brand like this could destroy the one jewel in the crown of Irish dairy.

Ornua’s performance is not beyond reproach and should be continuously questioned and challenged, but this move threatens the very future of Ornua and all it represents.

Financial performance at Ornua has plateaued since 2020, the very year that the new governance structure was introduced.

This saw member co-op chairs and CEOs dropped from the board and replaced with nominees. Maybe now is the time to examine the effectiveness of this structure?

Ultimately, the new blood on the board of Tirlán needs to ask themselves if sticking the knife in Kerrygold is the right strategy.