Ambitious expansion plans will allow one of the north’s biggest milk processors to allay Brexit fears and drive export sales, LacPatrick bosses say. By: Rachel Martin
LacPatrick’s new €33 million (£30 million) Dairy Technology Centre in Artigarvan, Co. Tyrone will be capable of processing up to 2.5 million litres of the white stuff each day. It means that for the first time, the co-op will be able to process all of the milk it collects in Northern Ireland within the region.
The new 30,000ft² Dairy Technology Centre will double the site’s capacity, making the firm one of the biggest producers of dairy products in the UK.
Chief executive Gabriel D’Arcy said the move will allow LacPatrick to grow internationally, as well as Brexit-proofing the firm.
“This is a significant investment here; it’s very much focused on new customers – it’s really to provide ourselves with a platform for growth, to grow our suppliers’ business. We certainly need to be more competitive and to be more innovative in order to allow us to pay a stronger milk price.
Given the uncertainty presented by Brexit, having three strategically-located, world-class facilities both north and south of the border positions us in a stronger competitive position to deal with any Brexit consequences.
“Brexit is a multi-faceted issue in terms of risks and opportunities. The most primal risk we had within LacPatrick three months ago was the ability to pick all the milk that we have from our suppliers and our shareholders within Northern Ireland and to process it within Northern Ireland – that is the most primal risk of any dairy company [here].
“[We have] the ability after March 19, 2019, to confidently tell all of our suppliers that we will be able to pick their milk on March 20, 2019, irrespective of what comes from the so-called Brexit negotiations – whether it is a hard Brexit, a soft Brexit or anything in between.”
LacPatrick’s Global Plans
D’Arcy continued: “Going forward we have got much bigger ambitions in the Gulf region, we have a lot of ambitions in southeast Asia – and obviously we want to expand our product reach with our existing markets.
“We can get products into African markets within six weeks of production. Whereas, the New Zealanders cannot get product out within six months of production – that is a huge advantage that we have.
“Our problem has been that we didn’t have the breadth of product range, so we have existing customers that will be taking these new products from us and then we also have new markets such as the UAE who are very big consumers of liquid milk.”
LacPatrick co-op was formed in 2015 in a merger between Town of Monaghan and Ballyrashane; today it turns over more than €360 millon (£324.5 million).
Annually, it collects 600 million litres of milk from 1,050 farmers spread across Ulster’s nine counties, with its main exports including powdered milk, cheese and butter.
However, the new technology will allow the site to produce two new lines – instant milk powder and low-spore spray-dried milk powder – designed for new international markets.
Straight off the plant, the instantised powdered milk is able to mix with water in as little as 7-8 seconds – compared to just under 30 seconds for existing powders.
The firm would sell the powder in 25kg bags which would be packed into cartons overseas by industrial manufacturers.
As a result, for the first time the firm will be able to supply intansised powdered milk to milk-deficit regions such as Africa and the Middle East.
Meanwhile, the low-spore products have long-shelf lives. This makes it suitable for use in vending machines and it responds to the convenience food trends in time-poor, technologically advanced countries such as Japan.
Already orders for the new lines have been placed from as far away as the United Arab Emirates.
The technology centre is designed to maintain constant production and is capable of producing powdered milk 24 hours a day, year-round. The pre-concentrator is over-sized so that there is always concentrated milk available ready to be used by one of the two finishers while the other is being washed.
The spray dryer consists of two cyclone tower chambers, an add-on which allows the factory to make a higher-spec powder suitable for the infant milk formula market.
It took 18 months to build the plant which employs 70 people.
The plant has one of the lowest carbon footprints in western Europe and draws around one million litres of water a day from the milk – which is then treated, pH-adjusted and chlorinated before it is recycled to rinse the plant.