The company said it was in discussion with Scottish authorities over developing a modern plant on the Kintyre peninsula for producing cheese and whey. The move reflects the growing importance on obtaining maximum value from raw materials like milk to achieve profitability in the increasingly competitive dairy market. By expanding production in the region, the company hopes to better exploit demand for its premium brands such as the Mull of Kintyre cheese. Group managing director Jeff Halliwell said the proposed was part of a drive for improved efficiency in First Milk's operations. "Our aim is to a deliver a world class processing network for our business and to achieve this we have reviewed all our sites, including our creamery at Campbeltown, and developed a programme of activity," he stated. Halliwell added that the company was now in discussions with the Scottish government over the plans. "The ministers recognised the importance of the dairy industry for the Kintyre peninsula and expressed their support for our plan," he stated. "Based on their suggestions, we are now engaged in detailed discussions with grant funding bodies to explore opportunities for financial support." The need for greater innovation in order to capture growing added value dairy markets has received strong support in the sector. Gwyn Jones, dairy board chairman of the National Farmers Union (NFU), said earlier this year that strengthening demand for cheese, whey and milk powder offered hope to the sector, providing supply chain "imbalances" were corrected. Joop Kleibeuker, the head of the European Dairy Association (EDA) also agreed pointing, in particular, to the vital role processors would have to play in shifting towards more high-end dairy products, to get better returns from its supply. "The EU has strong experience of producing added-value products in dairy production," he said. "This will be important in shifting towards producing whey proteins and other nutritious goods, and moving away from more basic consumer products."