Million-pound loan from Finance Wales helps North Wales dairy co-operative expand cheese production
Wales’ oldest and largest dairy co-operative is expanding its
cheese production facilities and helping to fund the development
costs with a £1 million loan from the Wales Capital Growth Fund
managed by Finance Wales.
South Caernarfon Creameries (SCC) first started operating at the
site near Pwllheli in 1937 and will use the funding to modernise
its production facilities and increase its first phase capacity
from 9,500 to 11,500 tonnes a year.
The expansion is part of South Caernarfon Creameries’ long-term
growth strategy which will see the continued development of its own
Dragon premium cheese brand which is sold across the UK by major
The company has supported North Wales’ agricultural sector for
over three quarters of a century and currently employs 90 local
staff. Over 90 million litres of milk sourced from local
suppliers is processed at the Pwllheli site each year.
Alan Jones, South Caernarfon Creameries’ Managing Director has
spent 18 years with the company and he believes the development of
the facilities is critical to the business’ future: “We
reviewed our business model in 2010 and decided to focus on the
development of our core products of Welsh cheese and butter. Our
Dragon branded cheese is the leading Welsh brand and is available
in most UK supermarkets. This investment to develop our facilities
is required to further grow the brand as well as to enable us to
develop other market opportunities.
“This funding package supports our expansion plans. Finance
Wales’ loan will help fund the initial development phase. The new
development will provide us with a very efficient and flexible
production facility which will further support our long-term growth
Mr Jones is also a long-standing member of the Dairy Strategy
for Wales Group which liaises with the Welsh Government on key
Welcoming news of South Caernarfon Creameries’ expansion,
Economy Minister, Edwina Hart said: “The £20m Wales Capital Growth
Fund was established by the Welsh Government in response to demand
from Welsh SMEs for short term working capital and I am delighted
to see how it is supporting such an important co-operative to
expand and increase efficiencies and capacity.
“The expansion will not only support the farming community in
the region but will also help support the Welsh Government’s aim to
increase annual sales of the food and drink industry by 30%
Finance Wales Investment Executive, Rhodri Evans structured the
loan from the Wales Capital Growth Fund. He said: “Having spent
most of my career working in North Wales, I know how important
South Caernarfon Creameries is to the area’s agricultural
community. It has been operating on the same site near
Chwilog since 1937 and is also a significant local employer.
“Alan and his team have transformed South Caernarfon Creameries
since 2010 and this investment provides them with the funding to
continue this transformation. Expanding cheese production is a
major development for the company and welcome news for the local
economy. Finance Wales has come up with a short-term capital
bridge-funding package to get the project underway.”
South Caernarfon Creameries has been recognised as a
forward-thinking co-operative with a strong working relationship
with its loyal members. Its cheese scooped five top awards at
this year’s International Cheese Awards.