Good news for Irish suppliers as Aldi decides to shop local

ONE MORE THING:SOME GOOD news for Irish milk suppliers from German discounter Aldi, which now plans to source all its milk requirement for its stores here from local dairies. That amounts to a near €20 million contract and should prompt a scrum among suppliers here.

The retailer is seeking to use the National Dairy Council logo on all its milk and cream products.

Listed food group Glanbia appears a certainty to tender for the contract and will probably be joined by Arrabawn and NCF, part of Connacht Gold, which both sell to the discounters at present.

Neither Lakeland, which doesn’t have a liquid milk manufacturing business, nor Kerry Group, which has a modest liquid milk business, are expected to be in the running. Aldi’s move is interesting. To date, it has sourced the bulk of its private label milk from Northern Ireland, although Arrabawn does have a contract worth about €5 million. Sourcing it locally will play well in its marketing and should please customers here who like to buy Irish and support local jobs.

It will also put it up to Dunnes Stores, which sources milk outside the Republic for its private label milk.

Sticking with food, there was good news this week for Musgrave, which secured a €30 million contract from fuel group Topaz to supply fresh and frozen produce over the next three years.

Musgrave’s joy, however, won’t have been shared in Limerick at previous supplier Pallas Foods. That company signed a three-year contract with Topaz in late 2008 and it was valued at €24 million over the period.

That’s a tasty hit for the business in the current economic climate.