Are Ornua and Glanbia on a collision course?

The initial reaction to Glanbia launching a high-concept cheese brand in the US has been fascinating.

Ornua has kept its counsel to date – but ICOS was quickly out of the blocks. Its statement never mentioned Glanbia or Truly Grass Fed, but repeatedly spoke of the need for “no duplication of resources”.

The fact that Martin Keane was ICOS chair until he became Glanbia chair six months ago makes these comments more pointed.

Interestingly, I hear that some current and past Dairygold board members were backing the Glanbia move, most notably former Dairygold chair and Ornua board member Bertie O’Leary. I understand the Ballyvourney farmer made his comments of support at a regional Dairygold meeting last week.

This is a bit more than a toe in the water by Glanbia. Significant resources have been invested in the “Truly Grass Fed” brand, which was set up back in 2016. Have a look at the website www.trulygrassfed.com. It’s a high-quality, glossy, exposition of the very best that Irish dairy farming has to offer. And it’s not just about selling cheese to Americans, the entire range of both consumer products and food ingredients are presented under the Truly Grass Fed umbrella.

If Glanbia continues along the lines it has started and puts more and more product into its own cheese and butter rather than Kerrygold, it will test the capability of Ornua to deliver.

Brand identity

Remember, Kerry has pursued its own brand identity for decades. It was inevitable that a company of Glanbia’s scale and ambition would create its own global brand identity, and Ornua’s decision not to site its butter plant at Belview did not help relations. If another significant Ornua player were to make a similar move, we would be in unchartered territory.

One observer described the Glanbia-Ornua relationship as being like Roy Keane and Mick McCarthy, which didn’t end well. Of course, it’s not as bad because the Glanbia lads are all still talking. In fact, I hear the Glanbia board is out with Fonterra in New Zealand this week for more talking. Could that be the start for another business-to-business arrangement and one less for Ornua? For now, the focus turns to the reaction from the key players around the Ornua board table.