It’s fair to say that the reaction among milk suppliers and shareholders to the talks between Aurivo co-op and Dale Farm co-op has been positive. There’s a long history of strategic collaboration, mergers and joint ventures among co-ops in other jurisdictions.

Global dairy giants such as Fonterra, Dairy Farmers of America, Arla, Friesland Campina and Valio are all co-ops that emerged as powerhouses through mergers. The latest merger is between Arla and German co-op DMK, which, if approved, will see the new co-op process over 18bn litres of milk annually.

The history in Ireland is markedly different, whereby co-ops tend to only merge during periods of strife. As a result, Ireland still has lots of smaller co-ops that are competing with these big players in international markets.

As processing costs increase, remaining competitive in the global market while paying a good milk price at home is going to become more challenging. The explorations around cost cutting by the boards of Aurivo and Dale Farm are welcome. Aidan Brennan goes into more detail on the move and what it means for farmers on pages 32-33.