Arla Foods is investing Skr70m ($7.4m) in a dairy plant in Sweden, enhancing production capabilities for cottage cheese.
Based in Denmark, Arla has announced that this investment at its Falkenberg site aims to boost annual output of Keso branded cottage cheese by 1,500 tonnes. This year’s target is set at 27,000 tonnes, which, if achieved, would represent approximately a 17% increase over the previous year’s production.
Arla explained that the project will focus on upgrading existing equipment, including filtration and cooling systems, while enhancing capacity and efficiency. The Falkenberg dairy primarily serves the Swedish market but also exports to Finland, Denmark, and Spain. Currently, it maintains six packaging lines.
Although no new jobs will be generated at this site, the workforce will remain stable at around 130 employees. Notably, Arla reports that staff numbers in Falkenberg have increased by approximately 20% over the past two years due to rising demand for cottage cheese.
Arla asserts that Falkenberg is the largest cottage-cheese manufacturing plant in Europe, and it also produces the Cheasy brand. The facility processes around 130 million kilograms of milk each year from its network of farmer suppliers.
The investment is set to commence early in the new year, with the additional capacity anticipated to come online by the final quarter.
In financial performance, Sweden generated €1.59bn ($1.85bn) in revenue for Arla last year, marking a 3.6% increase. Total group revenue saw a modest climb of 0.7% to €13.77bn.
Earlier this year, the country was also designated for further investment, with €34.5m earmarked for Arla’s facility in Jönköping to initiate production of skyr.
Moreover, cream cheese is a focus of another project in Denmark, where the co-op plans to invest €59.4m in its Holstebro Dairy.
April marked a significant development as Arla announced a plan to merge with German dairy peer DMK Group, pending regulatory approval. Just Food has sought an update from the Danish company regarding this proceeding today (2 December).
Additionally, Arla released its first-half results in August, reporting a substantial 12.7% revenue increase to €7.45bn, while EBITDA rose by 5.5% to €540m. EBIT climbed by 6% to €282m, although net profit experienced a 3.5% dip to €167m.
