Kerry Group CEO Edmond Scanlon is considering a new payment scheme for its milk suppliers as farmers continue to struggle as a result of this year's adverse weather, according to the Irish Independent.
At a media event yesterday (9 August) in the Intercontinental Hotel in Ballsbridge, Scanlon said that any scheme like that was “something we have to look at”.
Easing The Pressure
"There's a package of things we're looking at in terms of different types of support. We have to see how the next couple of months trade out, how the weather goes... but certainly we won't be found wanting as an organisation to help out our farmers."
He added that the group is more optimistic about the prospect of a milk price increase than it was in February, but admitted that the company has little control over the price.
“At the end of the day Kerry Group doesn't set the milk price, it's a market-driven event but we are doing everything we possibly can to drive the volatility out of it,” he told reporters.
IFA National Dairy Committee Chairman Tom Phelan today (10 August) said the move by Kerry Co-Op to increase the price for July recognises that there is scope for processors to lift their prices, expected other co-ops to follow this example.
“At a time when farmers continue to struggle with the weather-related events and fodder availability, co-op boards need to redouble their effort to reflect the European market”.
Tom Phelan said while co-ops have brought forward different measures to support dairy farmers, there is no question that paying the highest milk price that market returns allow is always the best support for farmers.
He also added that the company could spend up to €800 million on acquisitions this year. Any acquisition plan will be largely focused on the company’s taste and nutrition division.
Yesterday, Kerry Group posted its half-year trading update for 2018, where it announced that it increased group revenues on a reported basis by 1.4% to €3.2 billion in the first six months of 2018.
The dairy group said that this growth reflects ‘strong volume growth and contribution from acquisitions, offset by adverse currency movements’.
© 2018 Checkout – your source for the latest Irish retail news. Article by Aidan O’Sullivan. Click subscribe to sign up for the Checkout print edition.