Scottish Government has pledged to invest nearly half a million pounds in a remote Scots dairy.
Farm minister Richard Lochhead this week pledged around £450,000 in grant support towards improvements at First Milk’s Campbeltown Creamery.
The Glasgow-based farmers’ co-operative has been at the centre of the current dairy crisis.
In January it was forced to delay payments to farmers after revealing it was suffering from cash-flow problems. It also asked members to increase their capital payments into the co-operative to keep it afloat.
Its plant at Campbeltown, which produces the famous Mull of Kintyre cheddar, processes milk from around 40 dairy farms and supports 100 jobs in the area.
Mr Lochhead said the grant support was in line with the government’s Scottish Dairy Plan which sets out plans to secure the long-term future of the country’s dairy sector.
“A key strand of the Scottish Dairy Plan, which I published last week, is to support First Milk transform its business in Scotland. This includes upgrading the Campbeltown Creamery, which is a lifeline for producers on the Mull of Kintyre,” said the farm minister.
“The Scottish Government stands ready to invest in this important facility, and my officials continue to work closely with First Milk on their revised proposals for a new whey plant and various other improvements to the existing site.
“I expect to be able to issue a new offer of financial support very shortly – likely to around £450,000 – which will enable the first instalment of the grant to be paid within weeks and safeguard 25 jobs at the plant.”
A First Milk spokesman said: “This is positive news that the Scottish Government have confirmed they will pay out the grant money relating to the funds we have already invested in Campbeltown Creamery.
“It comes as we make progress in developing new sales for Mull of Kintyre and Isle of Arran cheddar, with new listings in M&S deli stores in the UK, and retail chains in the US and Australia.”
Government previously offered the co-op financial support for works at the Campbeltown Creamery, however this was not taken up due to changes in the business at the time.
EU state aid rules prevent the Scottish Government paying a grant of more than 20% of eligible costs at the creamery. The final upgrade costs at the plant are yet to be finalised but the government’s contribution is likely to be around £450,000.
Meanwhile, NFU Scotland has launched a campaign to encourage members of the public to buy Mull of Kintrye cheddar.
Union president Allan Bowie visited Campbeltown to launch the campaign alongside local dairy farmers.
The ‘Kintrye Cheese, Yes Please!’ campaign slogan will be displayed on bumper and car stickers and roadside banners in the area.
Mr Bowie said: “In the Year of Scotland Food and Drink it [the campaign] is a pertinent reminder of the high-quality produce that is on offer locally.
“The buck doesn’t stop with promoting the cheese locally however, we need to push for further marketing both nationally and internationally and we look forward to hearing from First Milk about how this will be achieved.”
* In January the Press and Journal launched a campaign to help struggling dairy farmers. The campaign, which has been backed by local producers, calls on members of the public to buy more British and Scottish dairy produce.