DENMARK – Arla Foods, a prominent dairy cooperative, is set to invest €210 million (US$227.6 million) in enhancing mozzarella cheese production at one of its dairy facilities in the UK.
The investment marks Arla’s largest ever commitment to the UK market, showing its dedication to meeting the rising demands of customers and enhancing product quality.
The Taw Valley creamery, situated in Devon, southwest England, will undergo technological advancements to cater to customer requirements, particularly regarding the browning, melting, and stretching characteristics of mozzarella cheese.
In a ddition, Arla plans to introduce cutting-edge technology, including patented processes that will significantly reduce the maturing period from 14 days to just one.
Peter Giørtz-Carlsen, Executive Vice President and COO of Arla Foods, highlighted the cooperative’s robust growth in the mozzarella segment over the past five years and emphasized the importance of maintaining leadership in the category.
“Our mozzarella business has seen double-digit growth over the past five years and we have strong relationships with key customers, particularly in global foodservice, and it’s from that very solid starting point we are announcing the investment today,” Peter said.
“But we also know that we have to work hard to maintain that position amongst the global leaders in the category and deliver on our strategy. This investment allows us to stay among the leaders within mozzarella, serve our customers even better and at the same time improve profitability for our farmer owners’ milk.”
In addition, he noted that the majority of mozzarella produced at the Taw Valley site will be exported to global foodservice customers.
David Boulanger, Executive Vice President and Head of Supply Chain at Arla Foods, emphasized that the investment will transform Taw Valley into a state-of-the-art cheese production facility, further strengthening Arla’s position in the global mozzarella market.
“With this investment, Taw Valley will become a state-of-the-art cheese production site and combined with our strong channel understanding in the global mozzarella category, we are strengthening further our business,” he said.
Construction of the upgraded facility is expected to be completed by 2026, with the first products anticipated to be available in the following year.
Importantly, this investment will not affect Arla Foods’ other mozzarella production sites in Denmark, ensuring continuity of operations across its global footprint.
In addition to this significant investment, Arla Foods recently announced its intention to divest a cheese-making facility in the UK, highlighting the cooperative’s strategic realignment to optimize its portfolio.
Despite reporting flat sales for the year 2023, Arla remains optimistic about future growth prospects, driven by positive consumer sentiment and strong brand performance.
CEO Peder Tuborgh emphasized the improving market conditions in the latter half of 2023, indicating a positive outlook for the cooperative in 2024.
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