Chart 1: Milk Production(1960=100), 1961-1996
YEAR
A third notable development in the behaviour of dairy-marketing cooperatives in Ireland at any
rate has been the huge structural change in their organisational structure. Specifically from about
1987 onwards there has a substantial widening in the ownership base of cooperatives through the
public floatation of these entities. A graphic illustration of the sea change which has occurred in
organisation structure is given in Chart 2 where it can be seen that from 1961 to 1986 none of the
total milk supplied was processed by publically-owned entities2. This percentage had jumped to
41% by 1987 and a steady growth is evident since then to 1996 where an estimated 52.2% of total
supply is now processed by public companies. It is beyond the scope of this paper to speculate as
to the reasons for the structural change (see, for example, Harte (1994), for a discussion of
possible reasons) but it may not be entirely coincidental that the change coincided with the advent
of production quotas. Dairy-processing firms, facing a profit squeeze as their raw material was
fixed in amount, were forced to diversify and for this capital was needed. The most efficient way
to raise capital was through a public floatation. Farmers on the other hand were prepared to cede
part of their assets on the prospect of compensating for the profit losses likely to flow from the
imposition of quotas.
2 Farmers as milk suppliers still retain a majority shareholding in these public companies.