Irish Dairy Industry Faces Challenges Amid Rising Costs and Falling Prices
The Irish dairy industry is currently grappling with substantial challenges arising from increased energy costs and a decline in milk prices, as highlighted by Colin Kelly, CEO of Lakeland Dairies. This situation has prompted calls for government intervention to protect farm incomes and avert further protests. Kelly emphasized the widespread impact of these issues across rural Ireland and the importance of avoiding disruptions in the country.
Kelly, speaking to The Irish Times, acknowledged the recent package of reliefs announced by the government but urged for additional measures. He expressed concerns about potential shortages in diesel, which could affect the cooperative's ability to collect milk from member farms.
In the fiscal year 2025, Lakeland Dairies reported a 10% increase in group revenues, reaching €1.9 billion. This growth was attributed to higher milk production volumes, with the cooperative processing a record 2.14 billion litres. Despite this, the period was marked by significant volatility, particularly in the second half of the year when milk prices dropped sharply due to a global oversupply.
Ornua, a part-owner of Lakeland Dairies and known for its Kerrygold brand, indicated that recent signs of price stabilization have been observed. The global milk flow in the latter half of 2025 was reported to be 4% to 6% higher than the previous year, an unprecedented scenario for the industry.
Lakeland Dairies managed to achieve operating profits of €34.4 million after exceptional items, an increase from €33.5 million in 2024. Distribution costs remained stable at €237.4 million. The company benefited from economies of scale, aiding in cost management amid these challenging conditions.
Additionally, Lakeland Dairies reported exceptional items, including €5.4 million in redundancy costs linked to an efficiency program, which involved reducing the workforce by 110 employees. This process concluded in the fourth quarter of the previous year. The cooperative also recorded exceptional income of €6.5 million from the sale of its ice cream business and the closure and sale of a factory in Monaghan.
