Dairy giant Arla eyes cheese and on-the-go milk NPD

“Cravendale is in all retailers, so the bigger opportunity is the on-the-go format,” ​Ash Amirahmadi, head of milk and member services, told FoodManufacture.co.uk. “We have 500ml, but if the demand is there we could make a smaller bottle.”​

Cheese would also a big focus for the business, he added. “In 2013 we launched Anchor into cheddar. There will be a lot more focus on that in the next year or so. The trick is how you are going to add value in cheddar.”​

There was more potential to develop cheese products and packaging in the next year, he said. “The key challenge in the UK is that as consumers we are quite underdeveloped. We tend to use cheese as an ingredient. We buy it and we grate it on food and put it in sandwiches.​

“We buy speciality cheese at Christmas time, but don’t know what to do with it at other times of the year.”​

Relentless mission​

The dairy cooperative was also close to boosting its milk supply by a further 300M litres as it continued its relentless mission to recruit dairy suppliers to its cause, said Amirahmadi.

He said the aim was to recruit 300 extra farmer suppliers by the end of the firm’s second financial quarter this summer. That would take total numbers to 2,800 farmer members, plus a further 300 direct suppliers, he said.

Amirahmadi said he estimated an average of one million litres of milk would be added to its supply for each farmer agreeing to supply the group.

Farmers were attracted by the high rates of return it paid for their milk compared with competitors, which helped to shield the dairy sector from rapid peaks and troughs in prices, he said.

‘Stability’​

“Our farmer owners today are earning between £15,000 and £20,000 ​[a year] more than their neighbours. That is something more and more farmers are finding attractive. It will bring much-needed stability back to the market.”​

Referring to processing, Amirahmadi said Arla’s plans to shift production from its Ashby-de-la-Zouch dairy and distribution centre to its recently opened Aylesbury plant were on track. The firm has declared plans to shut down the former facility in April this year​.

Having pumped £150M into its Aylesbury site and £500M into its UK supply chain in the past 10 years, Arla now aimed to consolidate gains and deliver new product development plans, said Amirahmadi. 

Expansions​

At the beginning of this month, the Arla group also announced a £243M investment in dairy expansions and environmental initiatives​ this year.

“We just invested £150M in a new production platform ​[at Aylesbury],” ​said Amirahmadi. “There are huge opportunities to drive premiumisation in milk and produce products people want and need.​

“We have just opened Aylesbury to drive the retail milk business. Some of that will be foodservice.”​

Earlier this week, Arla announced a rise in the price it pays its direct, non-member milk suppliers to 33.5 pence per litre (ppl), effective from March 1 this year. That followed a rise in price paid to farmer members from 33.83ppl to 35.01ppl, effective from February 3.