Expansion firmly on the minds of suppliers in new Lakeland survey

Lakeland Dairies’ milk suppliers are confident for their future in dairying, according to the results of an “extensive survey” undertaken by the co-operative, Lakeland has announced.

93% of Lakeland milk suppliers say they will stay in production for the future, including expansion already completed to date.

In addition to farmers who have significantly grown their output, roughly half of Lakeland milk suppliers said they will further expand their milk production by approximately 5% in each year to 2022, the co-operative added.

The Lakeland Dairies survey asked milk suppliers their intentions across several key areas including their future plans, investment levels, sources of funding as well as age and succession intentions.

Below are responses given by farmers to questions relating to business aspects of their farm enterprises.

Key results

A total of 90% of Lakeland milk suppliers are full-time dairy farmers. Over 25% of all Lakeland milk suppliers are under the age of 45, and roughly a third  – some 36% – are between 45 and 54 years of age.

Half of all milk suppliers said they have identified a successor to take over their dairy business.

A significant 80% of successors are all under 35 years of age and the vast majority of these have already received training – ranging from the Green Cert to a primary Degree in Agriculture.

On average, Lakeland milk suppliers have invested €53,000 in their farm facilities over the past five years, including livestock, parlours and buildings. Over 20% of suppliers said they have invested €100,000 or more on their farms.

In the main, expansion throughout the milk supplier base has been funded by a mix of borrowing and existing cashflow and, to a lesser extent, from savings or the sale of assets.

Among dairy farmers who are not expanding their enterprises, one third of these say that they will still need to invest in facilities over the next five years.

The average area of land that Lakeland milk suppliers own is 113ac, plus a further 55ac of rented land, to total 168ac. Of this, an average of 93 acres is available for grazing by the dairy herd.

Nearly half of all Lakeland suppliers said they may have access to more land to rent or purchase in the next five years.

Over 40% of Lakeland milk suppliers are interested in establishing a farm partnership, with the vast majority of these favouring a family partnership.

Just over one-third of Lakeland supplier dairy farms employ staff on either a full-time (8%) or part-time (28%) basis. Two-thirds of milk suppliers do not employ any labour on the farm, other than the family’s own inputs.

‘Encouraged’

Lakeland Dairies’ chairman Alo Duffy welcomed the findings of the survey. He said: “A thriving co-operative dairy industry is essential to support our farmers and the wider community through the promotion of economic growth and rural development.

We’re really very encouraged that the majority of our milk suppliers plan either to expand or to stay in dairying.

Duffy concluded: “Lakeland Dairies has invested substantially in processing capacity over the past eight to 10 years. The heavy lifting is done from a capital expenditure point of view, which will enable us to process all milk sent to us by our suppliers over the next three to four years.”