Kerrygold has become the first €1 billion Irish food brand in 2019, new figures from Ornua, the country's biggest exporter of dairy products, show today.
Ornua reported a strong performance for last year, despite what it called a challenging global environment characterised by economic uncertainty due to US tariffs, Brexit and market volatility.
Its operating profits for the year rose by 21.5% to €49.1m while its revenues increased by 11.5% to €2.322 billion.
The company said Kerrygold's success allowed it to pay a brand premium of €18.5m to its member Co-ops for butter, cheese and milk powders.
Ornua said its focus this year is to support its customers, co-ops and farmers, as they face the challenges of Covid-19.
As with most businesses, Ornua said it expects the coronavirus outbreak to negatively impact its business as the business uncertainty and disruption it is causing is severely impacting market sentiment.
It noted that consumer usage has changed overnight with people at home cooking and baking and as a result, Ornua is seeing an increase in demand for its branded and private label cheese and butter.
But demand for its foodservice products have fallen sharply due to the temporary shutdown of the foodservice and hospitality sectors in Europe and the US.
"The net impact of Covid-19 is a decrease in consumption of dairy products worldwide," Ornua said.
"Operationally, Ornua's biggest challenge is to keep its supply chain operating to ensure markets for Irish dairy remain open at a time of great uncertainty. A huge Covid-19 response effort is underway to mitigate risk, keep markets open and serve our customers," it added.
The company said it is committed to keeping all its factories operating and running safely.
"Should there be severe disruption or closure to Kerrygold factories, in Germany or Ireland for example, this would have a detrimental impact on the Irish dairy supply chain overall - resulting in a shortage of Kerrygold on supermarket shelves," it said.
Ornua also said it is doing all under its control to protect its staff, adding that extensive risk mitigation measures have been put in place at each of its sites.
It said the number of workers on-site has been minimised and no site visits are allowed. Where possible, people are working from home and the company said that physical segregation of shifts and the offsetting of shift patterns have been implemented.
The company also said it is securing additional storage facilities to spread risk locally and internationally and it is also securing additional international shipping containers at a time of global shortage.
Ornua has also reallocated staff from its ingredients business into its consumer business in order to ensure increased demand can be met.
John Jordan, Ornua's chief executive, said the company's key focus for the year is to support its 2,400 strong team, customers, member Co-ops and farmers as they face the challenges of Covid-19 together.
"We are firmly focussed on protecting the health and safety of our people, keeping our factories running safely to serve our customers and ensuring markets for Irish dairy remain open," Mr Jordan said.
The Ornua CEO said that despite the expected drop in global dairy demand, Ornua will continue to purchase product from member Co-ops in line with 2020 agreements with over €1 billion in dairy product purchases planned.
He said this will see Ornua carry the risk and cost of stockholding on behalf of its members, going some way towards providing a level of security in these uncertain times.
"We are also working hard to maximise Kerrygold premium returns to enable us to continue to deliver strong product prices to our members, and in turn Irish dairy farmers," he added.