Lifting milk quota

investorboy

I believe the milk quotas are soon to be lifted, so I'm thinking that some agri companies based in Ireland will be in a great position for growth over the next few years. Initially I was thinking Kerry group or Glan Bia but both these companies are quite diverse & while could benefit from the mentioned change there are probably others who will benefit more. Anyone any tips on this?

Atlantic Dawn

I would be unsure exactly how much success the lifting will bring, the market will be flooded with cheap milk from throughout the EU, most likely this will result in reduced prices of the end products getting produced from the milk as there will be over supply of the raw material. The cost of production in Ireland would be higher than low cost Eastern European operations.

spear_mint

Atlantic Dawn wrote: »

I would be unsure exactly how much success the lifting will bring, the market will be flooded with cheap milk from throughout the EU, most likely this will result in reduced prices of the end products getting produced from the milk as there will be over supply of the raw material. The cost of production in Ireland would be higher than low cost Eastern European operations.

their will be a very large increase in milk production from ireland but very little from most other european major milk producers , the uk never fills its quota and the likes of the netherlands has no room , only france and ireland will increase production significantly , no country in eastern europe is a major producer of dairy products


to answer the OP,s question , kerry and glanbia are the obvious comapnies to benefit but their price is likely to already be baked in , stock pickers think ahead , kerry and glanbia have gone up by around 150% in the past three years

thomasm

Glanbia have just about completed a new purpose built facility in Belview at a cost of €400million to boost milk powder production for export to concide with quotas lifting. As above I'm sure all this is priced in at the moment

Sam Kade

There will still be control over milk production. You will need coop shares to produce milk and also a contract where you will have to let them know how much you will send at the start of the year you can go a certain % above or below that amount. At the moment farmers are exporting maiden dairy heifers as there is no demand for them.

spear_mint

thomasm wrote: »

Glanbia have just about completed a new purpose built facility in Belview at a cost of €400million to boost milk powder production for export to concide with quotas lifting. As above I'm sure all this is priced in at the moment

yes but stock price may have reflected this facilitiy expansion and other expansion a year ago , glanbia has not made all time highs in nearly a year now , its very richly valued and doesnt really operate in a particulary high margin sector for most of its business

it was a terrific buy two years ago

frazzledhome

http://www.agriland.ie/news/minister-goes-alone-butterfat-adjustment/

_Brian

investorboy wrote: »

I believe the milk quotas are soon to be lifted, so I'm thinking that some agri companies based in Ireland will be in a great position for growth over the next few years. Initially I was thinking Kerry group or Glan Bia but both these companies are quite diverse & while could benefit from the mentioned change there are probably others who will benefit more. Anyone any tips on this?

Lakeland Dairies would be a smaller producer but have considerable expansion plans for more powder and butter production.