Dave Young Dave Young

DAIRYGOLD, IRELAND’S LARGEST dairy farming co-op, has announced excellent profits for the second year running.

The privately owned co-op recorded operating profits of €27.2 million for 2014, almost level with the €27.3 million brought in in 2013.

Turnover was also up slightly to €848 million. Last year was a particularly volatile one for milk production worldwide with the price of milk dropping significantly in particular last summer, making the maintenance of profit levels especially impressive.

Dairygold Dairygold

There is a cautionary element to the results however with net debt increasing by almost €11 million to €71.6 million.

This is related to the co-ops’s expansion of its processing campus at Castlefarm, Mitchelstown, and the redevelopment of its Mallow facility.

With EU milk quotas today finally being abolished after 31 years the sector is set to expand like a balloon in the coming years.

Irish milk production is expected to increase by some two billion litres by 2020 now that the shackles are off.

Dairygold processes almost 20% of the Irish milk pool at the moment, and its 3,000 farmers are looking to up their output by 60% over the coming years.

Things are going to be busy.

Co-op chairman James Lynch acknowledged that the end of milk quotas will offer ‘real opportunities’ and that Dairygold is ‘ready to take full advantage’.

“There are always events and challenges that will be beyond our control, but the fundamentals for the industry are sound,” he said.

Without quotas the expansion of the industry in Cork is set to create 4,000 jobs and a €450 million economic investment in Cork alone over the coming years.

Dairygold CEO Jim Woulfe still sounded a note of caution for farmers looking to expand at a rapid rate however. “Farmers should expand cautiously,” he said.

Many will have super-levies and higher investment costs to contend with if they go about things too quickly.

Prudence is to be encouraged.

Simon Coveney, left, and friend(s) Nick Bradshaw Nick Bradshaw

Earlier, agriculture minister Simon Coveney insisted that the removal of quotas is “the most fundamental change to Irish agriculture in a generation.”

Now the shackles are off and the sector can start to realise its full potential.

It’s a great day for rural Ireland.

Read: The cows are going to be very busy in Cork. Up to 60% busier, in fact

Read: An Irish product that predicts when a cow will give birth is about to make it big time (oh, and it’s called Moocall)