How will Ornua’s new Spanish facility benefit Irish farmers?

Yesterday, Tuesday, November 5, saw the official opening of Ornua’s €30 million cheese facility in Avila, Spain.

The managing director of Ornua Ingredients Europe, Bernard Condon, commented on how this investment will create value for Irish dairy farmers.

Speaking at a media briefing yesterday, Condon said: “We have to drive scale efficiencies.

The total Ornua Ingredients Europe business handles about 75,000t of dairy products – and about 50% of that is currently Irish. We’re actively working with some of our members to try and increase that percentage.

Continuing, the managing director also highlighted the Irish dairy exporter’s efforts to reduce reliability on cheddar – particularly in light of Brexit.

On this he said:

“With Brexit and the potential impact of Brexit on our cheddar market, we do have to think about other markets for our cheese solids.

One of the great things about this facility is it takes a product called cagliata, which is a product which can be made on a cheddar facility; it turns it into mozzarella – which is not a cheddar and is a product that is consumed globally and across continental Europe.

It was noted that Ornua has the capacity to produce enough cheese – such as mozzarella – for 100 million pizzas each year, with key customers including Spanish food giant Telepizza.

“When you come outside of the UK and try to sell cheddar, it’s pretty much a niche product outside of the UK and US, so that’s one of the key advantages.”

Ornua CEO John Jordan added that, while it was a big investment, the new facility “secures a route to market for Irish product and it is profitable – so it’s a good investment for us; a very good investment”.

Jordan added that the new facility also gives Ornua capacity for growth, adding that prior to the factory opening “every spare ounce of capacity” was being used to keep up with production.

Rising from the ashes

On the matter of taking the decision to rebuild the factory, on the site of the original plant which was completely destroyed in a fire two years ago, Condon added:

“For me there were probably three key variables: The first is logistically it would have been very expensive to try and service Spain from the UK; whatever about blocks of cheese, by the time you grate and dice them, they take up so much more space – so logistically it would actually have been quite expensive to serve this market.”

He added that a second factor was the commitment of staff at the Spanish facility – particularly in the aftermath of the blaze.

During the opening, it was noted that many of the Spanish factory’s team went to work in Ornua’s UK plants following the destruction of Avila’s original facility.

“As a business we really do want to keep that culture and that commitment within the global piece. And then the other piece was obviously Telepizza is a key customer and we felt it was probably important to have a hub in Spain to service it – but also to service our export markets in Atan, which is more easily achievable from a Spanish base.”

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