Glanbia's controversial decision to curb the supply of milk from farmers is linked to a planning objection taken by An Taisce against a major cheese manufacturing plant earmarked for Bellview, Co Kilkenny.
Glanbia Ireland, the State's largest milk producer, announced on Monday that it plans to impose a 30 per cent cut in price for volumes beyond a certain limit in a bid to curtail supply during the peak milk months of April, May and June.
The measure, which it described as “temporary”, will apply to milk supplied from 2022 on.
Farmers have criticised the move, saying they will be left out of pocket and that it was tantamount to a new milk quota for dairy farmers supplying Glanbia.
Glanbia Ireland has, however, been forced to revise its processing capacity in wake of a High Court challenge taken by An Taisce against An Bord Pleanála's decision to grant planning permission for a cheese manufacturing plant in Bellview.
The €140 million plant, a joint venture between Glanbia and Dutch dairy processor Royal A-ware, was to be operational next year.
The plant was to make Gouda cheese for international markets and take in 450 million litres of milk annually. However, this is now in doubt.
An Taisce argues that the environmental impact – in terms of increased carbon emissions and the likely deterioration in water quality – of the agricultural activity arising from the increased milk production needed to supply the plant have not been factored into An Bord Pleanála’s decision.
IFA criticism
Nonetheless the Irish Farmers’ Association (IFA) criticised Glanbia’s move, describing it as “the first step towards a milk quota for Glanbia suppliers”.
IFA president Tim Cullinan also took aim at An Taisce over its legal action.
“The vindictive court action by An Taisce has impacted Glanbia’s plans, but the company has a responsibility to its suppliers,” Mr Cullinan said.
“Since 2015, farmers have optimised their milk production through efficient use of our grass-based production system,” Mr Cullinan said. “Farmers are now being asked to produce more milk at times of the year when production costs are higher. This decision will cost farmers money.”
Under Glanbia’s peak supply management policy, the processor said farmers with an annual milk supply of less than 550,000 litres will be allowed to grow their milk volumes by 5 per cent over the peak supply months above a base year, while those with a supply above 550,000 litres would be limited to growth of 2.5 per cent.
Glanbia Ireland confirmed that price deductions above the prevailing milk price would be applied above these allocated limits.
