Ornua was not informed of plans by Dairygold to launch a range of cheeses in the US market under its Pastureland brand. The move by Dairygold into the lucrative North American market came to light through retail channels in the US, the Irish Farmers Journal understands.
Ornua’s Kerrygold range is the leading imported butter and cheddar cheese brand in the US.
Dairygold chair and dairy farmer John O’Gorman defended the move by Dairygold. In an interview with the Irish Farmers Journal, he maintained that Dairygold had been looking for a value added outlet for cheddar for a long time.
He also claimed the move would not undermine Kerrygold in the US market.
“My role as chairman is to maximise the return to shareholders, we got offered an opportunity with TINE and we took it,” he said.
Cost for farmers
However, IFA deputy president, Brian Rushe, maintained that Irish dairy farmers will carry the cost of Ornua, Dairygold and Glanbia battling for market share in the US.
Rushe claimed Dairygold’s move could undermine the level of return Ornua secures for Kerrygold product.
Any reduction in margins would ultimately be carried by Irish milk suppliers, the IFA deputy president maintained.
Comparing Dairygold’s move to Glanbia’s launch of the Truly Grass Fed dairy range in the US in 2018, Rushe said he failed to see the value of crowding the market and undermining the benefits that Kerrygold delivers for Irish farmers.
“We have a brand in Kerrygold that is unmatched in the States, no one can compete with it in terms of value or provenance,” Rushe said.