Scottish First Milk producers have been left shell-shocked after the processor announced its intention to sell its Arran and Campbeltown creameries following a strategic review of the business.
The processor is seeking buyers for the two sites which supply the Isle of Arran and Mull of Kintyre brands respectively, but it is understood there will be no immediate changes for First Milk suppliers.
See also: UK dairy has highest processing investment in EU
Last month First Milk harmonised its four milk pools into a single price, so Scottish members would not see prices change disproportionately to members in England and Wales.
However, Farmers Weekly understands a prospective deal for the creameries could include producers supplying the creameries in the future.
Strategic review
“Following a strategic review, we have determined our branded consumer-facing businesses in Campbeltown and on Arran are not a strategic fit for First Milk moving forward,” said First Milk CEO, Shelagh Hancock.
Ms Hancock added the review did identify markets for the premium Mull of Kintyre and Isle of Arran brands, but First Milk was not prepared to deliver the significant investment necessary to capture these opportunities.
“However, we are confident with the right focus and investment under new ownership the businesses would prosper,” she added.
“A sale would enable us to continue with our focus on developing our major creameries in Haverfordwest and the Lake District, creating value through broadening and strengthening our strategic partnerships and delivering best value for our members’ investment.”
The two creameries would continue to run as normal during this sale process First Milk said they would work closely with buyers to ensure a smooth transition.
“We appreciate this decision will affect some of our colleagues, but we hope that under new ownership the sites will thrive, offering good employment prospects for the future,” said Ms Hancock.
By Jack Yates
Source: Farmers Weekly
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