Arla Foods to boost early life nutrition ingredients production

DENMARK – Danish dairy giant, Arla Foods, has unveiled plans to expand its production of Early Life Nutrition (ELN) ingredients, leading to a significant restructuring that may result in job losses.

The reorganization is part of the company’s strategy to meet the growing demand for ELN products, which includes transforming its Arinco facility in Videbæk, Denmark, into a dedicated ingredients production site.

Arla Foods Ingredients (AFI), the company’s subsidiary responsible for this sector, is expected to surpass current production capacities at its Danmark Protein and Arinco sites.

Consequently, Arla has announced it will discontinue its business-to-business (B2B) ELN operations within the next 19 months, focusing instead on expanding its branded ELN business.

This strategic shift is anticipated to affect approximately 170 employees at the Arinco site and AFI’s headquarters in Aarhus.

Luis Cubel, Group Vice President and Managing Director of AFI, acknowledged the difficulty of the situation, stating, “It goes without saying that this is a difficult situation and a tough day for our employees.”

“The changes will not be fully implemented for another 19 months, and until then, we will do everything we can to retrain and find internal job opportunities for those affected.”

In addition to the reorganisation, Arla has entered into a partnership with the French cooperative Sodiaal, a key player in the ELN market.

Under this partnership, Sodiaal will produce all of Arla’s ELN products for the Chinese market, as well as for other international markets. This collaboration is expected to leverage Sodiaal’s robust production capabilities to bolster Arla’s branded ELN business, especially in China.

Luis Cubel expressed optimism about the future of Arla’s ingredients sector, stating, “We see a very bright future for ingredients and a world of opportunities.

This new strategic direction will accelerate our ambitious growth plans for our ingredients production and enable Arla Foods Ingredients to further strengthen our position as a leading global player in the ingredients market.”

The transition period will last until the end of Q1 2026, during which Arla plans to work closely with its customers to meet existing demands before phasing out B2B ELN production at Arinco.

In related developments, Arla recently announced a DKr20 million (US$2.9 million) investment in its Esbjerg factory in Denmark to support the growth of its Starbucks and Cocio milk drinks in Europe, the Middle East, and Africa (EMEA).

The cooperative, owned by 8,000 farmers across Denmark, Sweden, the UK, Germany, Belgium, Luxembourg, and the Netherlands, continues to invest in its operations to meet evolving market demands.

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