Spiralling costs threaten jobs at Arla

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Related tags: Cost, Arla foods

Job losses in the UK could be on the cards at dairy giant Arla Foods as part of a cost-cutting drive to offset rocketing input costs.The company,...

Job losses in the UK could be on the cards at dairy giant Arla Foods as part of a cost-cutting drive to offset rocketing input costs.

The company, which last month warned that full-year profits would be below expectations, said it was "exploring a variety of measures to mitigate exceptional inflationary pressures" resulting from rising oil prices that were sending distribution and packaging costs through the roof.

Arla said that while it was always looking to increase efficiency and was in constant negotiations with customers over prices, job cuts could be on the cards. "It's too early to say, but we are having difficulties recovering cost increases, particularly in the middle-ground [convenience] retail market," it said.

While continued blockades at Arla depots by pressure group Farmers for Action (FFA) were "inconveniencing" the company, they were not causing major disruption to supplies, Arla added.

However, the FFA boss David Handley insisted that his protests against Arla's recent 0.35p/l milk price cut were having an impact and vowed to carry on.

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