A €150 MILLION ‘CONTINENTAL’ cheese facility in Kilkenny is hoping to diversify Ireland’s cheese production as part of a post-Brexit strategy.
Post-Brexit trade talks are ongoing between the EU and UK: if there is no trade deal, tariffs of up to 56% could be placed on cheese going from Ireland to the UK.
Even if there is a trade deal, customs and health certificates could mean that exporting cheese to the UK will be “like exporting into China”.
Unlike other dairy products, this cannot be redirected elsewhere, as Ireland and the UK are the only consumers of cheddar cheese in significant quantities. So plans are being made to make new cheeses on the island of Ireland, intended for export to the EU.
This new cheese factory will be located in Belview, near the Waterford border, and will make edam and gouda cheese. This a joint venture between Glanbia and the Dutch company Royal A-ware, as part of a strategy to diversify the Irish export market.
The cheese industry in Ireland
Conor Mulvihill from Dairy Industry Ireland told TheJournal.ie that if there is a trade deal, that will mean there is “no tariff no quota arrangement”.
“The UK is a 17 million person market on our doorstep,” Mulvihill says, pointing out that it’s difficult to ignore, Brexit or not.
“But what it means is there’s going to be a rake of non-tariff barriers. It will be like exporting into China, there will be a rake of heath certs and transport certs that will still need to be put onto our product.”
He says that cheese is a relatively high-volume and low-profit margin product (there’s a 3-4% margin on cheddar exports to the UK), so any type of extra delay or cost is a challenge, though is still “infinitely” better than a no-trade deal situation.
Referencing the ban Russia placed on EU products in 2014, he said:
[A no-trade deal] Brexit will make the Russian ban look like a picnic – Britain is a much different kettle of fish than what Russia was.
There are four cheddar factories in Ireland which process 2 billion litres of milk a year; 56% of what is produced is exported to the UK market, which is worth over € 1/4 billion a year.
These figures are from 2017-2018, but are thought to be broadly representative of the market as it stands currently, as hardly any investment has gone into producing cheddar in Ireland since Brexit.
A look at environmental concerns
There has been some debate about the future of the dairy herd in Ireland in the context of how to respond quickly to the climate crisis.
An Taisce has been granted permission by the High Court to seek a judicial review of An Bord Pleanála granting planning permission, based on environmental concerns about this particular cheese plant, which Glanbia and Dairy Industry Ireland strongly refute.
In its objections submitted to planning authorities, An Taisce said: “Intensive cattle farming is also a major emitter of GHGs [greenhouse gas emissions] and is contributing significantly to Ireland’s ongoing failures to reach its legally binding Paris Agreement targets.”
An Taisce has argued that the impact of the estimated 450 million litres of milk needed to supply the plant should have been assessed by An Bord Pleanála, particularly the resulting ammonia and greenhouse gas emissions and “likely” deterioration in water quality.
According to An Taisce’s estimates, the milk produced to supply this plant on its own would lead to a 2.5% increase in ammonia emissions.
Glanbia has said that the cheese factory is an “essential” piece of infrastructure, and will help to sustain the local rural economy. Glanbia pays out €1.05 billion in payments per year to its network of 4,500 family farms.
It aims to create 100 permanent jobs in the factory, and up to 400 jobs during construction. Glanbia said is “fully satisfied” in the project’s merit and is happy to work with any stakeholder about their concerns.
A national debate has been ongoing about the environmental sustainability of the dairy herd in Ireland.
When asked about this, Mulvihill said that the dairy industry has dealt with “three huge icebergs” this year: Covid-19, Brexit and climate change.
“It goes beyond emissions because… we’ve come to the conclusion that that’s hugely important for de-carbonisation.”
But if you get a reputation for destroying watercourses for undermining your soils for undermining biodiversity – our industry will be in huge trouble. So there’s a huge commitment and the penny has dropped. We really need to get our house in order – not just in terms of the factories – but be reaching out to our farmers suppliers and working with them to put them on a path.
“Because there’s so much good going on – we have the globally lowest carbon footprint per litre of milk produced,” he says, though adds that gross emissions are increasing due to the success of the dairy industry.
“The way the [Intergovernmental Panel on Climate Change] emissions calculations are done, it means that Agriculture is 33% of [Ireland's] emissions so we are rightly scrutinised.
If we have economic success, you can just say ‘Oh, sure we’re great and sure we’re delivering €11.5 billion back into the Irish economy on a yearly basis’.
An yeah, that’s one element of sustainability, but I’m sorry, it doesn’t wash with Mrs Murphy in Limerick city. They want to know that you’re not screwing up the environment here. And to be honest we don’t have enough proof points yet on that.
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