News that a significant share of the North Cork Creameries milk pool based around Moyvane, Co Kerry, have handed in their notice will come as a blow to the fledgling management team at North Cork Creameries.
New CEO Stephen Daly is in the role for less than three weeks, having previously headed up the dairy operations and commercial manager role.
The Irish Farmers Journal understands that his primary task since taking over has been to reengage with Carbery Group over a milk processing agreement.
Daly’s predecessor in the role of CEO Michael Cronin negotiated a deal that Carbery would process 100m litres of North Cork milk for a period of 10 years with a 1c/l discount under the Carbery base price to be paid to North Cork milk suppliers.
A separate payment - supposedly of up to €5m annually - was to be paid by Carbery to North Cork to run the co-op, test the milk and transport the milk to Balineen, in addition to sorting out the waste water treatment plant.
However, this deal subsequently fell through and Michael Cronin resigned from his position. At the same time, the current chair of North Cork Thomas O’Donoghue resumed the position of chair, having previously resigned when the deal was first agreed at board level.
The Irish Farmers Journal now understands that a new five-year deal with Carbery is back on the table for 70m litres annually, but news that the Moyvane milk pool is threatening to leave threatens the viability of this new proposed deal with Carbery.
Business model
The North Cork Creameries business model has been to process milk on behalf of other co-ops and producer groups.
Sources close to co-op management have confirmed that a new business plan has been created and the leadership retains the belief that the business remains viable.
In 2024, the co-op processed 82m litres of milk that came direct from shareholder farms.
The Irish Farmers Journal has learned that a further 100m litres came from Strathroy farms, mostly in the east of Ireland in Wicklow and Wexford.
The co-op also processed milk on behalf of neighbouring co-ops such as Dairygold and Kerry, with 20m litres and 15m litres processed respectively.
A further 10m litres was processed from Lee Strand and 4m litres from neighbouring co-op Boherbue.
Limerick Liquid Milk Producers - a producer group from near Limerick city - supplied 18m litres to the North Cork plant at Kanturk.
Earlier this week, the management of Strathroy confirmed to the Irish Farmers Journal that it was no longer sending any milk to North Cork Creameries.
The deal to process milk with Limerick Liquid Milk Producers is set to finish at the end of 2027, leaving North Cork with just 80m litres of its own milk to process, excluding the milk sent by neighbouring co-ops who have their own processing capacity.
As the proposed deal with Carbery is for 70m litres, if up to 30m litres of milk from the Moyvane area leaves the co-op, this threatens the viability of this new Carbery deal.
Meanwhile, it is understood that North Cork wants to continue some processing at the site in Kanturk, but it remains to be seen where that milk will come from.
North Cork Creameries was established in 1928 and will celebrate its centenary in less than two years’ time.
Management of North Cork Creameries have declined to comment.
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