The formal opening of Glanbia’s butter plant in Ballyragget, following a €17m upgrade, was Commissioner Phil Hogan’s third such function in little over a month. It was an important event, if not as headline-grabbing as the Belview opening.

Butter may not have the cachet of sports or infant nutrition products, but it still lies at the heart of all Glanbia does. As GII CEO Jim Bergin said, if the butter plant stops, all production is affected. This upgrade gives a production capacity of 80,000 tonnes of butter a year, a 50% increase, vital for Glanbia’s plans to handle 2bn litres of milk.

The volumes being handled in Ballyragget are staggering. The sight of lines of lorries waiting to unload is the visual evidence – the numbers back the eyes up.

Ballyragget’s eight intake bays are being fed by 160 to 200 lorryloads of fresh milk every day. In addition, cream is coming from other Glanbia plants, from Dairygold and from Carbery; as much as half a million litres a day of cream to be added to that from the milk processed on site. Last week saw a record 31.6m litres of fresh milk delivered.

Butter consumption globally is projected to increase by 4.5% annually for the rest of the decade – a higher rate of increase than for overall dairy product consumption.

Glanbia is the leading producer of butter for the Ornua’s Kerrygold brand, but the majority of butter is for agri-food companies rather than the shop shelf. Whatever the product, Ireland’s grass-based milk production gives a natural golden hue to our butter, a distinct advantage.

Chairman Liam Herlihy spoke of the pre-quota era, when the buzzword was MCAs – the system of market supports to encourage production.

Market is everything

Now, it’s all about MSAs – milk supply agreements in a post-quota world. The point he was making, in one of his last functions as Glanbia chairman, was that markets didn’t matter in the 1970s, whereas now, the market is everything. The MSAs are controversial with some suppliers, but they provide certainty for processors and their customers in the food industry – certainty of continuity of supply which allows long-term contracts to be built.

It’s with this in mind that Glanbia is constantly upgrading its processing network. Ballyragget alone has seen over €100m of investment in the last decade.

While Belview was a greenfield operation, this total revamp of the butter plant was carried out without ever halting production.

Most of the work was done in the fallow period of December-March in the last two winters. A dividing wall was erected to seal the production and building areas apart. Now the two lines can produce 18 tonnes/hour.