KINTYRE is one of the most productive dairy farming areas in Scotland, but it does suffer from being remote and highly dependent on virtually all of the milk being processed at the creamery in Campbeltown.
There have been concerns over the future of that facility, despite regular investment and upgrades.
It was originally built as a distillery in 1820s before being converted into a creamery many years ago.
However, First Milk, the farmer-owned
co-op with more than 2,600 members in Scotland, England and Wales, announced yesterday that it is plans to build a state-of-the-art creamery in Campbeltown with the assistance of a grant of up to £3.9 million from the Scottish Government. The existing creamery is supplied by 42 farms while the dairy sector in Kintyre is estimated to be worth at least £11m to the local economy.
The total cost of the new creamery, which will have a larger capacity, is regarded as "commercially sensitive", but the sale of the existing facility to Tesco, funding from First Milk's capital reserves and the government assistance make the project viable.
Visiting Campbeltown yesterday, Richard Lochhead, the Cabinet secretary for rural affairs, said: "This substantial investment is a great boost for the peninsula of Kintyre and the dairy sector.
"I made it clear at our recent 'dairy summit' that we are committed to doing all we can to support the Scottish dairy sector.
"Our largest-ever grant for a dairy company in Scotland proves we are willing to turn words into decisive action."
The Mull of Kintyre brand has a growing national and international reputation and this is supported by the fact that the creamery won three gold medals at the last World Cheese Awards.
Lochhead added: "At last week's Royal Highland Show, there was undoubtedly a feel-good factor. It's important that we build on the momentum and use the nation's fantastic produce to enhance our economic, environmental and health credentials. Our national food and drink policy provides the framework to make this happen.
"The Campbeltown creamery is a huge part of the social and economic fabric of Kintyre.
"I am delighted that, in partnership with First Milk and Tesco, we are able to offer many families and communities throughout the region a much brighter future."
First chief executive Milk Peter Humphreys said: "This is a red-letter day for us, our employees and dairy farmers on Kintyre. This new investment secures the future of the dairy industry in this part of Scotland.
"From day one, the Scottish Government provided us with encouragement and we are very grateful for the grant assistance they have committed to give us."
Tony McElroy, corporate affairs manager with Tesco, added: "This is a really exciting project for us and we are proud to be involved in helping to safeguard the future of cheese-making in Campbeltown.
"Our partnership with First Milk will not only help to protect production in the area, but will also enable Tesco to create over 200 much-needed new jobs."
Dairy farmers have been struggling to cover production costs in recent months and unless returns improve many more will leave the industry, but not in Kintyre. Jim McLaren, the president of NFU Scotland who ceased milk production on his farm near Crieff some months ago, welcomed the announcement.
He said: "Confidence levels among dairy farmers are in need of a boost and this significant investment in modern plant to produce an award-winning product maps out the route to re- invigorating the dairy sector across Scotland."
