The supply of milk will be the key factor influencing dairy markets and milk prices for farmers in the remainder of 2018, Lakeland Dairies chief executive Michael Hanley has said.

Speaking to the Irish Farmers Journal at the opening of a £5m packing facility at the co-op’s Newtownards factory in Co Down, Hanley said that demand in dairy markets remains steady.

“I am surprised at the strength of supply across the rest of the world, particularly Europe, for the last two or three months. I would have thought the heatwaves of Europe, and indeed Ireland and the UK, would have pulled milk production down a lot more but it hasn’t done that,” he said.

“Fingers crossed we will have steady markets and a supply matching demand as we go out towards the end of 2018,” the Lakelands chief said.

Hanley described 2018 so far as a “reasonable year milk price wise” and added that prices have been better than many expected they would be at the start of the year.

LacPatrick

On merger discussions with LacPatrick, Hanley described the process as “well-advanced” and said further details will be announced to shareholders in the next few weeks.

“We have been driving consolidation for the last 20 or 30 years. Six different dairy businesses form part of the Lakeland group.

“At the end of the day it’s not so much about consolidation, it’s about driving efficiency so that we can pay as much as we can for every litre of milk,” Hanley said.

New facility

A new automated packing facility was opened at the Newtownards factory by HRH The Princess Royal on Wednesday.

The £5m facility is part of a wider £27m investment that Lakeland has spent at the Co Down site over the past 10 years.

A Global Logistics Centre was opened in Newtonards in 2015 and is described by Lakelands as one of the most technically advanced export facilities in Europe.

“We are addressing many opportunities for growth and development in line with continuously strong global demand for dairy products,” Hanley said at the opening ceremony.

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