Welsh dairy co-op SCC continues growth trend with record profit

South Caernarfon Creameries has also begun a major expansion at its HQ, set to finish in 2024, to increase capacity

Farmer-owned dairy co-op South Caernarfon Creameries (SCC) has reported record operating profits of £3.4m on sales of £61.5m for the year to o 31 March.

The Welsh cheesemaker processed record volumes of milk and has paid a total of £806,000 to its 135 farmer suppliers.

It business has enjoyed five years of strong growth, with sales doubling from £30m to £60m as it reached the production capacity of its plant. A £14.4m expansion at its headquarters at Chwilog, near Pwllheli, was announced in January and is set to finish by 2024.

The co-op says this will increase capacity from 15,000 tons of cheese a year to 23,000 tons and create an extra 30 jobs, bringing its workforce to 160.

Managing director Alan Wyn Jones said dairy markets had recovered quickly from the lockdown and the slowdown in non-retail sales, which was compensated for by a growth in supermarket trade.

“In a year like no other we have delivered a resilient business performance,” he added, “while continuing to pay one of the best milk prices in Wales to our farmer-members.

“The site processed record volumes of milk in the last 12 months and this trend will continue as we carry on growing while maintaining our high quality standards.

“We are well-used to operating in a volatile global marketplace, but no-one could have foreseen the challenges of the last year in which the Covid crisis struck.”

He warned that the new Brexit trading arrangements have added costs and administration to exporting, making the sale of the co-op’s products more difficult in a wider market and hitting UK returns.

But he added: “While the year ahead will remain challenging as we continue to manage the business alongside the pandemic conditions and seeing cost inflation now coming through from raw materials and key overheads, the positives are that global economies will continue to recover, the fundamentals of dairy look positive.

“Our focus remains on the delivery of our objectives and the opportunities ahead, which we are now well-placed to take advantage of to deliver long-term business performance and prosperity for our stakeholders.”