Irish agri co-op Lakeland Dairies warns of processing job cuts

The move is part of a new strategy set ‘against the backdrop of evolving environmental realities and regulatory direction’

Farmer-owned Irish co-op Lakeland Dairies has warned of job losses with the closure of three processing plants as part of a new business strategy.

The co-op’s liquid milk production plant in Coolshannagh in Co Monaghan, which employs around 50 people, is to close in the first quarter of 2025. Liquid milk production will transfer to Lakeland Dairies Killeshandra, and all other bulk milk handling activities will transfer to other Lakeland Dairies sites.

Milk drying facilities at Lough Egish in Co Monaghan, where more than 20 people work, are also to close in June 2024. And a butter churning and packing and powder storage site in Banbridge, Co Down, which employs two people, will close in June 2024.

Lakeland hopes to redeploy some of the 78 workers affected to other roles in the co-op.

It says the move is part of “significant change“ to be put in place between now and the first quarter of 2025, “to ensure the co-operative is well placed to meet future market requirements with a realigned processing footprint to match milk supply profiles”.

The cross-border dairy processing co-op says it has spent this year assessing how best to create further processing efficiencies in the long-term interests and sustainability of its 3,200 farm families who produce 2bn litres of high-quality milk annually.

“This new strategic direction will be carried out against the backdrop of evolving environmental realities and regulatory direction from a milk supply perspective,” it adds.

“Regrettably, redundancies will be necessary to realise this strategy as operations will be ceased on the three sites. Exact details and numbers will be confirmed in due course but it is anticipated that 78 jobs will be impacted by the announcement. There will also be redeployment opportunities for some staff into vacant positions in the business.”

The co-op has started an engagement and consultation process with staff and their unions directly. The remaining 1,300 Lakeland Dairies staff will not be directly impacted, it adds.

“As a business, we continually assess how we can take long-term strategic decisions that will benefit the Society for this and subsequent generations,” said CEO Colin Kelly.

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“Lakeland Dairies is a co-operative with a heritage spanning nearly 130 years. We have a strong balance sheet, strategically located sites in ROI and NI, a high-quality milk pool of some 2bn litres produced by 3,200 committed farm families, a customer base in over 100 global markets, and we are well placed to meet future demands. However, we are approaching a decade that will be different from the one that the industry has just experienced.

“The industry has come through a period of significant volume growth following the removal of milk quotas in 2015. Lakeland Dairies invested over €350m to support the ambition of our farm families to produce this additional milk and meet the latent demand at farm level for expansion. The next decade will be less about large volume growth and more about value-added growth and adding capability throughout the business. This will be done to drive the best possible returns for our farmers and to continue to offer our loyal customers the highest-quality products while supporting our people and our communities.

“We do appreciate that this announcement creates uncertainty for our colleagues and their families. We will work closely with them and support them throughout this process in which they will continue to be treated fairly and with respect. While this is a difficult decision, it is a crucial one to ensure that Lakeland Dairies is future-proofed and well-positioned to meet the challenges as well as the opportunities of the future.”