Strong dairy prices and a more balanced market within the EU has allowed the Irish Dairy Board to increase its pre-tax profits by 10 per cent to £24.1 million last year, even though sales in the year stood still at £1.3 billion.
But a breakdown of the turnover figure shows a severe drop in sales out of Ireland from £730.4 million to £594.3 million. However, the board's operations in the UK, continental Europe and North America all showed substantial gains, partly due to the impact of overseas acquisitions - totalling £30 million last year.
The main factor in the fall of sales from Ireland was an 8.5 per cent cut in EU support prices for butter and skim milk powder, as a result of green pound revaluations reflecting the strength of the pound in late 1996 and early 1997. These revaluations resulted in the value of Irish-generated sales falling by between £80 million and £90 million.
The IDB chairman Mr Tom Cleary said that the biggest challenge to the board in the years ahead is the EU Agenda 2000 proposal, which would increase the size of Ireland's milk quota by just 1 per cent, while new EU members like Austria and Finland have been offered 7-8 per cent quota increases. The IDB chief executive Dr Noel Cawley had good news for the country's dairy farmers, saying that the board hopes to maintain its current 111p a gallon milk price through the peak production months of May and June. The price compares with an average of 107p last year, he said.
