Challenging the idea that Ireland is in decline

Carbery Milk Products, Ballineen, Co, Cork. Pic Denis Scannell.

While in west Cork last week I came across some high-quality shellfish produced by Glenmar Seafood.

That company is actually owned by a local farmer-owned co-op – Lisavaird – and it should encourage debate among co-ops country-wide about their potential role in combating the economic threats to rural Ireland.

Lisavaird is one of four long-standing farmer controlled co-ops that form Carbery Milk Products, a significant processor of milk that has its key facility based in Ballineen, Co Cork.

Decades ago Lisavaird and the other three co-ops operated creameries in each of their respective geographic regions while also providing farm inputs including feed and fertiliser.

Changes in the way milk is processed, and in particular the need to improve efficiency, has forced co-ops all around the country to explore rationalisation options to reduce costs and protect farm gate milk prices.

In west Cork, this evolved to a point where the four co-ops have centralised milk processing in Ballineen.

While they retain the role of collecting milk from farms and providing farm inputs the core dairy operations are focused on a single site.

This arrangement leaves the four co-ops with their own boards of directors and the ability to consider alternative investments to dairy processing. In Lisavaird this has included investments in a variety of businesses including shellfish.

Lisavaird Co-op has invested in a range of food-related businesses over recent years, diversifying from sole dependence on dairy processing.

Those investments include bakery, seafood and food service activities that create financial returns for the co-op and its members while generating jobs and economic activity.

Alongside the three other west Cork co-ops Lisavaird has also invested in wind farms.

If Lisavaird can do this it begs the question what other investments could agricultural co-ops all around the country contemplate in the fight to create economic activity in rural Ireland.

I should emphasise this thought is not advanced through some misty-eyed notion of co-operatives providing an alternative to capitalism.

Rather, I’m arguing hard-nosed investment decision making should lie at the core of any move in this direction.

It is a fact that many farmer controlled co-ops exist across Ireland.

It is also a fact that all of these will inevitably have to consider further steps towards consolidating the dairy industry in future as it scales up and encounters ever greater competition from gigantic global milk companies and co-ops.

As this process unfolds these co-ops have to weigh up the opportunity for them to invest in other activities that create financial returns for their members while also supporting initiatives that can support and create jobs.

Given the challenges facing rural Ireland as it competes for investment how far-fetched is it to imagine farmer co-ops playing a greater role in devising opportunities that exploit the cost benefits of operating from rural Ireland while targeting physical and online markets in Ireland and beyond?

I have been reading RA Anderson’s brilliant book written in 1935 about his work encouraging the establishment of co-ops in Ireland.

If you want an insight into the challenges faced by someone like Mr Anderson and Horace Plunkett trying to convince farmers to work together this is a good read.

It illustrates well how hard it is to challenge conventional wisdom.

Right now it is conventional wisdom that rural Ireland is in structural decline and that trend cannot be reversed.

The shellfish and bakery products produced by Lisavaird Co-op are small but important signals of resistance to such thinking.

Rural townlands need champions to take on those who prefer to facilitate migration towards the large cities in Ireland.

The long-standing agricultural co-ops have an important role to play in that debate.

Joe Gill is director of origination and corporate broking with Goodbody Stockbrokers. His views are personal.

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