Fury over the recently announced loyalty bonus terms, poor milk price and what was described as mismanagement of the co-op drew over 300 Dairygold suppliers into the Firgrove Hotel in Mitchelstown, Co Cork on Monday night.
Bandon-based supplier and meeting organiser Niall Twomey opened the meeting by outlining his unhappiness with the co-op loyalty trading bonus and calling on all suppliers present to terminate their milk supply contracts with the co-op in protest.
“We were forced to sign a revolving fund, because at the time the co-op were stone broke and they couldn’t handle the milk that was coming at them [post quota abolition], so we all invested in it, reluctantly at the time, but we invested into it and we showed our loyalty to this co-op for the seven years of the investment.
“And what have we today, only complete mismanagement and total disloyalty back to us again. And I, for one, am fed up of the whole thing and we need change.
“The co-op is top heavy with white collar, at our expense, and there has been gross overspending done on construction projects, at our expense again. And they expect loyalty, loyalty, loyalty from the whole lot of us."
Contract
“The only way they are going to listen is if enough of us come together and sign documents that we are terminating our contract with Dairgold and moving to another co-op,” Twomey told the gathered crowd.
Dairy farmer Nigel Sweetman, from Cork Central IFA and chair of the organisation’s poultry committee, criticised Dairygold’s lack of support for the IFA’s derogation protest in Bandon.
Sweetman said he was paying the price of being a Dairygold supplier by being “consistently about 3c/l behind Bandon’s price”. Calculated over his total milk supply of 1.25m litres, he would be “over €39,000 better off for doing nothing extra” if he was supplying Bandon. He added that Bandon suppliers also got half price grass seed, half price fertiliser, and further discounts on polythene, detergents and fencing gear.
‘Too quiet all along’
“I think we’ve been too quiet all along, and I’ll put the hand up, I think farm organisations are politically correct and frightened of upsetting anyone,” Sweetman added.
He described Dairygold’s loyalty bonus as “the final insult”.
“For me, I would have to spend €72,000 on inputs to get whatever loyalty bonus comes at the end of the year, when Bandon Co-op has been delivering that all summer with no conditions.”
Eoin Burke from Kilross urged the crowd, which was noticeably younger than many farmer meetings, to pull together to make changes.
Eoin Burke, a member of the new committee of disgruntled Dairygold suppliers, speaking in Mitchelstown, Co Cork on Monday night. \ Caitríona Morrissey
“I left frightened here after the monthly meeting last December,” he told the crowd. “They then had 1.8bn litres of capacity and 1.4bn litres of a supply going forward. So that’s 75% and that 75% has to pay for all the steel that’s after being put in place, so how are they going to pay a leading milk price?
“They’ve also got another €144m in debt and they’re going to spend another €60m this year on capital stuff. That’s frightening. Frightening stuff. They’re already paying a terrible milk price and I can’t see how they’re going to be able to do any different going forward,” Burke said. “I’d be very worried for the future of this co-op with those figures.”
‘Frightening borrowing’
Former Minister of State and Cork East TD Ned O’Keeffe told the gathered crowd that the issues in Dairygold were “much bigger than the bonus you are all talking about”.
“I think the borrowing at Dairgold is very frightening. I’m hearing the interest - and it might be only gossip but I’ll stand over it – is €20m per annum, €400,000 per week. That is a huge figure and we’re here talking about pence stuff. Our co-op is on the red line, that’s what I see, and it needs support and some direction.
“Borrowing is a crucial issue and Dairygold has over-expanded. If you look at the milk league, you’ll see that Tipperary Co-op suffered and we’re second over Tipperary,” he said, pointing out that Strathroy paid the highest milk price by only assembling milk.
Borrowing is a crucial issue and Dairygold has over-expanded
“Dairygold has to have a rationalisation process urgently and to scale down its operation if you’re going to get a price for milk.”
Referring to comparison with Carbery, O’Keeffe said: “Carbery doesn’t have a store business, it doesn’t have a hardware business, so simply milk, and it’s leading the country and probably the British Isles.
“Our borrowings are out of control and that’s the problem and they’ve been left out of control. I understand we have plant that cost €80m that will not be used this year,” O’Keeffe said.
Farmer after farmer aired their grievances with Dairygold and at one point Twomey and others proposed that they call newly-elected Dairygold chair Pat Clancy from the meeting to made their feelings known.
Following intervention from the floor from a farmer who described the such a move as “out of order after 10 o’clock at night”, the idea was abandoned.
Demands
A show of hands was used to confirm that the farmers present wanted each of three demands to be presented to Dairygold board and management:
1. That the loyalty bonus scheme be dropped with immediate effect;
2. That capital investment be shelved; and
3. That a three-year period from giving notice to leaving the co-op be reduced to three month.
A committee was formed which consists of Niall Twomey, Eoin Burke, Ned O’Keeffe and Tadhg Sweeney.
Read more about Dairygold and the meeting in this week's print edition.
Read more
Termination notices lodged as Dairygold spat deepens
Dairygold adds conditions to milk price top-up
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