How Ireland is turning into a food-processing giant

Move over Kerrygold butter – Ireland’s real food export success story is in unbranded food ingredients such as whey and vanilla

Kerry Foods has become one of the biggest suppliers of vanilla to the baking world. Photograph: Getty Images

Here’s a small eureka moment in the Irish food world. The head of a large food company has had a long day in a conference room with executives from an Irish food ingredients giant. They finish with a grazing trip around the hottest cafes, restaurants and cocktail bars. In a bar, someone serves a Bloody Mary garnished with a piece of crispy bacon. He takes a sip, puts down the glass and declares: “Now that’s what I want my burger to taste like.”

It’s as far from the picture of Irish food as it gets but ingredients like a Bloody Mary bacon seasoning are an untold part of Ireland’s food story. If you dream it, there is a team of scientists in Irish labs that can probably make it happen.

Seasonings, thickeners, bulking agents, sweeteners and flavours formulated in Glanbia, Ornua and Kerry Foods labs can be found all over the globe. Ever wonder where the batter on your Chicken McNugget or the spiced pumpkin flavour in your Starbucks coffee came from? That would be Kerry Foods, an Irish company started by a group of what a company spokeswoman describes as "cute farmers down in Kerry" who saw their customers "making a whole pile of money" from the whey they were selling and decided to start processing it themselves.

In the 46 years since, the money pile has grown to epic proportions. A co-operative processing milk in Listowel now makes foods its founders wouldn't recognise. As one industry analyst puts it: most consumers have no clue what a food giant like Kerry does.


One stab might be that Kerry makes Kerrygold butter? But no, that's Ornua, which used to be the Irish Dairy Board. Kerry's consumer brands like Charleville cheese, Denny and Dairygold are the tip of an iceberg. Below the waterline is the much larger "Taste and Nutrition" division, which brought in €5.2 billion of Kerry's €6.4 billion revenue last year. Most of the food ingredients are shipped unbranded from one factory to another. The company has become one of the biggest suppliers of vanilla to the baking world, according to one industry source, controlling the supply chain from farms in Madagascar to an extraction plant in Grasse in the south of France. Its Global Technology and Innovation Centre in Naas, Co Kildare, is one of the largest in the world. Teams from PepsiCo and McDonalds regularly visit to brainstorm what they're doing next. Somewhere in Naas, or the sister operations in Singapore or Beloit, Wisconsin, they're probably working on the McDonald's summer specials for 2020.

We love to think of Irish food in terms of green fields and farmers. But the food isle is becoming a food-processing isle. It’s less a story of farm to fork than lab to larder.

Driven the growth

Food ingredients have driven the growth in Irish food and drink exports. In the past two decades, exports have more than doubled from €5.6 billion to €12.6 billion. We are not producing twice as much food. Farmers are not farming any more land. Milk production has risen following the dropping of the EU milk quota but the sector accounting for the fastest growing area is the ingredients for the food service, ready meal, snack, cereal, on-the-go and fast-food industries.

Ireland's food-processing behemoths have been driving the export boom, swallowing food companies and partnering with global brands with revenues in the tens of billions. Our food ingredients industry is a hothouse of enterprise and innovation, producing home-grown giants or a threat to our food traditions, health and small-farm culture, depending on which side of the fence you stand. The big players like Kerry, Glanbia, Greencore and Ornua have fingers in pies all over the globe, and are major players in the race to produce the foods that mean we don't have to cook for ourselves, the snacks that push our crave buttons and nail our bliss points, infant formula as close to human breast milk as scientifically possible, all the while keeping ingredients costs as low as possible.

Like tech companies, there is a dizzying sense of forward momentum, pushing food technology on to the next trend, whether it’s a creamier cheesecake made with less cream or an emulsifier that isn’t palm oil. As public health concerns are raised about the effects of ultra-processed foods, the food giants are moving to repackage what they do. “Clean labelling” is the new buzzword, replacing ingredients that consumers don’t want in food with more comforting-sounding ones. It all sounds like a step in the right direction if trust in big food wasn’t at such a historic low.

Prof Alan Kelly: The Irish food industry is “one of the most scientifically advanced in the world. It’s a hotbed of scientific innovation in food science.” Photograph: Tomas Tyner, UCC

Prof Alan Kelly is based at UCC's Food Science department and he is getting used to seeing his graduates walk straight out into jobs in Ireland. "There's no let up. Last year's food science students? Every single one of them had a job, right around the country. There's almost full employment for food graduates in Ireland, which is great."

How did we get here? Partly it’s down to what we farm. More than 80 per cent of Irish agricultural land is in pasture or grazing for animals, primarily cows. It’s no surprise that a country whose primary agricultural product is milk has a large food-processing sector. The gold rush started with milk, or more specifically the whey that was the byproduct from the cheese industry. Prof Kelly remembers a plain-speaking phrase coined by an Australian colleague. Whey, he said, went “from gutter to gold”.

Whey protein

For every 100 litres of milk used to produce cheese, 90 litres of it will be whey, Prof Kelly explains, “so it’s a really efficient success story of using an ingredient that used to be treated as a waste product”. Whey protein is familiar to body builders and the sports world but whey is used across the board in processed foods, cereals and snacks. The food industry would like to “mainstream that protein science into people’s lives”, according to one industry source. Glanbia’s business model has been based on packing whey protein into as many drinks and snacks as possible.

Whey also contains a lot of lactose, which is used in the pharmaceutical industry. “If you take a tablet, a tiny fraction is the actual ingredient,” Prof Kelly explains. “The rest is lactose.” The mining of whey for new ingredients is far from finished. Scientists are now looking at peptides in milk protein that can help reduce cholesterol or improve mood.

The scientist is not fond of the term “ultra-processed foods”, with all its connotations of cheap crap. He prefers the term “formulated foods”. Busy lifestyles, two-worker households and life on the go rather than gathering round a dinner table every day has made convenience foods daily staples. “Are people being influenced by the food industry pushing it on them or is the food industry giving them something they need?” Prof Kelly asks. “There’s an innate suspicion of the food industry as being somehow nefarious but by and large people in industry are well-intentioned,” he argues. The Irish food industry is “one of the most scientifically advanced in the world”, Prof Kelly says. “It’s a hotbed of scientific innovation in food science.” Much of that stems from the mountains of research carried out into infant formula. Efforts being made to “humanise” cows’ milk – to mimic the fat and nutrient profile of human milk has involved a phenomenal amount of research.

Not everyone is happy with Ireland’s dominance in the infant-formula market. Ireland supplies up to 15 per cent of the total global market. Public health experts point to Ireland’s average breast-feeding rates, which are among the lowest in the world, and particularly at their lowest in poor communities.

Concerns about the environmental impacts of big dairy and the nutritional implications of marketing infant formula in developing and developed countries put the dairy focus of Irish food science in a different light. At a briefing on the European Academies Science Advisory Council in Dublin earlier this month, Dr Aifric O'Sullivan, assistant professor in human nutrition at UCD, said innovative foods like insect protein, tackling food waste and the idea of sustainable diets will all come into focus in the near future. Looking at how we "underutilise marine resources but over exploit fish stocks", and genotyping wild plants, are all areas of food science in which Ireland could innovate. Global demand for meat and dairy is rising by 2 to 3 per cent, she said, "but that's not sustainable in the long term". In terms of dairy "breeding to reduce greenhouse-gas emissions", looking at carbon sequestering in soil and smarter agriculture are all needed if dairy, that primary building block of Ireland's processed food industry, is to grow substantially bigger.

Global reputation

Big food is going through a bad time. Bord Bia brought David Hughes, emeritus professor of food marketing at Imperial College London (who brands himself Dr Food) to talk to the Irish food industry about the global reputation of Irish food.

"If you look at the top 20 fast moving consumer good grocery companies, virtually all of them are seeing little or no sales growth and in many cases they're selling off bits of their business," Hughes explains in a Skype interview from an airport lounge in between speaking engagements. In Europe and the US "they're being outmanoeuvred by these quick-on-their-feet millennial start-up companies who have a better understanding of the under-40s market and so what are they doing? Every single one of those [big food firms] has established a venture capital arm and they're co-financing, buying into or buying those start-up companies.

"They're also expanding into emerging Asia where their iconic brands still have legs, where people are still willing to buy Oreo cookies."

Ireland’s place as a “big ingredients” producer rather than “big branded” means that worldwide consumers have no idea what Irish food is. The Irish firms are quite good at researching, developing and then patenting new food ingredients, Hughes says, but “not quite as good as Denmark”. Danish speciality food companies “are more profitable than your own companies but you’re in the right direction”.

“If I say around the world ‘what is Ireland famous for in food?” people tend to look sort of blankly. In the US they might say corned beef and cabbage, which is hardly the place you want to be in. You have a whole series of really interesting smaller firms that have got nice niche products but Ireland means very little to world consumers. They probably have a positive perception of you being clean and green but that isn’t a differentiating factor, that’s a minimum requirement increasingly. If I’m talking at a conference and say on the podium ‘will all those countries who are clean and green please form an orderly queue to my right?’ then there’ll be a huge rush, with you guys being pushed out by the Scandos, then there’s the New Zealanders saying ‘we’re the clean and green’ and even the Australians, who are brown and dusty, say they’re clean and green.”