Ornua, owner of the Kerrygold brand, is set to start work on an expansion of the Kerrygold Park site at Mitchelstown in Co Cork.
Investment in the facilities will cost in the region of €40m and the expansion will take place within the existing Kerrygold Park campus next to the Dairygold powder plant at Castlefarm.
The current capacity of Kerrygold Park is for up to 50,000t of butter per annum and Ornua say it is likely to increase on a phased basis over several years.
Ornua, the largest exporter of dairy products from Ireland, owns the Kerrygold brand and Ornua itself is owned by a group of Irish dairy co-ops
In planning documents lodged to Cork County Council, the company says the extension will increase capacity by up to 6,000t per year, through the installation of an additional stick butter processing line.
Kerrygold is Ireland’s first €1bn food brand, hitting the milestone in 2018. Ornua, the largest exporter of dairy products from Ireland, owns the Kerrygold brand and Ornua itself is owned by a group of Irish dairy co-ops.
Ornua says it plans to grow the Kerrygold brand into €2bn worth of sales by 2025. This extension of Kerrygold Park will facilitate increased production of Kerrygold butter destined for the high-value US and German markets, where Irish butter commands a premium price over competitors.
The brand got a further boost last month when the US and EU announced a truce to the 17-year trade dispute over aircraft subsidies. Since October 2019, the US has been applying a 25% tariff to dairy products coming in from the EU, including Kerrygold butter.
Getting planning permission at Mitchelstown wasn’t all plain sailing
Despite the tariff, Kerrygold managed to retain its position as the number two butter brand in the US. With the tariff removed, Ornua must decide whether to reduce the retail price (which had gone up after the tariff was introduced) or retain more margin and add further value to the brand, which is popular among US chefs and foodies.
Getting planning permission at Mitchelstown wasn’t all plain sailing, with a submission from An Taisce stating that the various environmental impact assessments were “deficient in not addressing the impacts of the increased milk supply source required to increase production”.
In its submission to the Council, An Taisce said the proposal was similar to that of the proposed Glanbia and Royal A-ware cheese plant in Kilkenny which it was appealing against.
Ornua welcomes the decision of Cork County Council to grant planning permission for the expansion of production facilities at Kerrygold Park in Mitchelstown
It even included its appeal to An Bord Pleanála against the Kilkenny cheese plant in its submission to Cork County Council about the Kerrygold butter plant. In any event, Cork County Council granted permission and An Taisce didn’t appeal it.
An Ornua spokesperson told the Irish Farmers Journal: “Ornua welcomes the decision of Cork County Council to grant planning permission for the expansion of production facilities at Kerrygold Park in Mitchelstown and would like to thank stakeholders for engaging with us during the planning process. We will now look to move forward with this strategically important project, delivering substantial economic benefit for both the Mitchelstown area and the Irish farming community.”