The CEO of Ornua has warned of a challenging 2026 and outlined the risks associated with following commodity prices.

Conor Galvin was speaking at the launch of Bord Bia’s Export Performance and Prospects Report 2025-2026 this week.

“Milk volumes were strong all the way through 2025,” he said. “We had favourable growth for grass and weather. And we also had a herd in a position to produce a significant volume of milk.

“Unfortunately…other regions had the same dynamic in terms of volumes produced. So what we saw was volumes up in 2025 [in many regions].

“What that has led to in the second half of the year is a significant correction price. So a lot of the value of 2025 is supported by butter and cheese, and that’s good news because those are products we can differentiate ourselves with when we’re exporting.”

The Ornua chief explained that 2025 was a good year for both for volume and the value in return.

"But our industry is driven by sustainable value. And how do we drive sustainable value back into the hands of dairy farmers?" he continued.

“As we look into 2026 that’s where the focus has to be – in trying to restore that confidence. I think this is going to be a challenging year. This is going to be a tough year from a pricing point of view.”

Volatility

The Bord Bia report contains a section titled ‘Building Value Amid Volatility’, which caught Galvin's attention. “I was struck by the title…which mentioned volatility,” he said.

“We need the Irish [dairy industry] to have more confidence in pricing going forward so we can see that the correction going in a positive direction.

"Until we see that happen, there will be challenges, which is why, from a dairy point of view, we have to keep differentiating ourselves. If we are constantly exposed to commodity prices, we will get the volatility.”  

“There used to be a rule of thumb in dairy where you’d have a good year and a bad year and then two average years; now we have a good month, a bad month, and two bad months.

He explained that in order to drive certainty to the industry, to encourage investment and differentiation, some of the volatility need to be eliminated.

"We only do that by being back on what makes us different and what makes us compelling," he said.

“This year, it will be a case that we batten down the hatches, invest in what’s important, and wait for the market to correct.”