Dairy saw almost £2.50 loss per kilo of cheese

A small protest was held in April against the decision to stop producing cheese at Guernsey Dairy

Guernsey Dairy was losing £2.37 per kilogram of cheese produced, a Freedom of Information request has revealed.

Cheese production at the facility halted in February, as officials said it did not have the space needed for the machines to continue producing it.

The amount of cheese made by the dairy has declined. In 2020, 17,648kg was produced, compared to 10,760kg in 2024. In 2024, the dairy lost £156,000, continuing a trend of operating deficits in recent years. Since 2020, it has lost more than £1m.

The States Trading Supervisory Board (STSB) said operating losses could be addressed if a new facility was built. A States decision about a new dairy is expected before the end of June 2026.

Plans for a new dairy are more than a decade old

President of Guernsey's Farmers' Association Michael Bray said: "What we need as an industry is a dairy that's fit for purpose.

"The dairy has not been invested in for a large number of years. That has put it further into disrepair, and that has, unfortunately, resulted in higher staff numbers, more breakdowns, more losses and, unfortunately, that equals financial downturn for the dairy."

Plans for a new facility were halted in the last political term by deputies, who labelled them too expensive, gold-plated and unnecessary.

The current facility in St Andrew has been in operation for nearly 70 years, with its last major refurbishment more than 30 years ago.

The STSB, which oversees the dairy, said a decision on whether to prioritise the project would be made in "Q2 2026".

Capital projects

A new facility could be located on the current site, or elsewhere.

In February 2025, deputies agreed to increase the subsidy paid to local dairy farmers to £2.35m a year.

Other capital projects which have been put on hold like the second phase of the hospital modernisation project and the sixth form centre could also have their fates decided as part of government work plan planning next year.

New figures have shown the amount of milk consumed in Guernsey has declined in recent years.

In 2020, Guernsey Dairy produced 5,679,890 litres of milk, compared to 2024 when it produced 5,415,707 litres.

The amount of cream and butter produced by Guernsey Dairy has also declined in recent years.

Some 270,229kg of butter was produced in 2020, dropping to 238,389kg in 2024.