Welsh cheese farmers’ co-operative bounces back from pandemic with £71m record sales
A leading Welsh cheesemaker and farmer co-op has come roaring back from the pandemic with profits of £4.1 million and a massive 17 per cent increase in sales to a record-breaking £71.5 million.
South Caernarfon Creameries has boosted turnover and profits in the year to March at the same time as ploughing £3.8 million back into their investment programme Project Dragon, a five-year £20 million plan to boost production at its Chwilog dairy near Pwllheli.
That will see cheese production at Wales’s most established and largest farmer-owned dairy co-operative increase from its current 16,000 tons a year to 23,000 tons by 2024 with an extra 30 jobs created at the award-winning creamery taking its workforce to over 160.
Project Dragon also includes new facilities for milk reception, additional cheese production and packing with work continuing to improve environmental and energy performance.
Managing Director Alan Wyn Jones said: “Good progress has been achieved in what has and continues to be a very challenging period for everyone as well as the unimaginable circumstances in Ukraine adding to supply chain issues caused by the post-pandemic reopening of the economy.
“Despite that the business has performed strongly, increasing turnover in volume and value and with profits again up on the previous year at 5.8 per cent of sales, above our five-year average of 4.9 per cent.
“The pandemic led to increased sales in our largest market, UK retail, with strong consumption in the home and business to business sales performing better than expected.
“Demand has continued to recover in the smaller wholesale markets and in foodservices though not yet to pre-pandemic levels but we have made better than expected profits while providing our members with one of the most competitive milk prices in Wales.
“This was achieved at the same time as a major investment in Project Dragon which has seen the new effluent treatment plant completed with work starting on the whey processing facility that will be operational by autumn 2023.”
South Caernarfon Creameries, which is owned by its 145 farmer-members across North, Mid and West Wales, has been able to pay the second highest milk price in Wales to its producers, an annual average of 31.53p a litre.
They were also able to allocate nearly £1 million in dividends to the members, many of whom have been with the co-op since it was founded in 1938, and that record pay-out amounted to just over 25 per cent of SCC’s profits.
Alan Wyn Jones added: “Despite ongoing challenges, the business has made good progress this year with significant ongoing investment at the Creamery which will enhance performance and further futureproof the business.
“Dairy is in the spotlight around concerns over environmental footprint and animal welfare and here we also take our responsibilities seriously and we will continue to build upon the great industry work in this area in the year ahead.
“As our consumer attitudes change we must continue to work to ensure that they continue to enjoy the great taste and nutrition of dairy without any associated climate or animal welfare concerns.
“We would not have made the progress we have to date without the continued commitment and hard work of all our staff who have continued to deliver for our members despite the challenges of the last year. We extend our thanks to them all.”
South Caernarfon Creameries was founded in 1938 with an initial 63 producer-members and has now grown to be Wales’s premier dairy company supplying its cheese and butter to the UK’s major supermarkets as well as to international markets.
For more information on South Caernarfon Creameries go here.
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