The Irish Dairy Board (IDB) enjoyed strong growth in turnover and operating surpluses in 2006, despite weak market conditions and steadily declining prices for dairy products in the first half of the year.
The co-operative, which owns the Kerrygold brand, said there had been a turnaround in market conditions in the final quarter, with the board offering higher prices for skim milk powder and butter.
Prices for other dairy products, including casein and cheese, are lagging behind, but IDB chairman Michael Cronin said the strong butter and milk powders markets should give dairy farmers a welcome increase in prices, at least in the short term.
Turnover increased 5 per cent to €2.07 billion, while the board recorded an operating surplus of more than €43 million, a rise of 5 per cent on the previous year.
The dairy board's consumer foods division accounts for €724 million in turnover, while its food ingredients business has a turnover of €560 million. DPI Speciality Foods, its distribution business in the US, has sales of €790 million, up 14 per cent last year.
Revenue reserves at the end of 2006 were €326.2 million, an increase of 11 per cent on 2005, while members' funds rose 8 per cent to €394 million.
The board made a total cash payout of €18.5 million to members, up 23 per cent on 2005. This figure included bonuses of €11 million and redemption of loan stock amounting to €7.5 million.
Kerrygold sales increased 5.7 per cent last year, with good performances in the UK and Germany. The butter is now the number one imported brand in the US, with sales of almost €20 million. Chief executive Noel Coakley said the Irish dairy industry needs to prepare for the easing of milk quotas, which it expects will increase by 2-5 per cent a year from 2009 before their abolition in 2015.
