Arla looks to branded sales and exports to boost farmgate prices

Arla Foods UK was looking to boost branded sales, improving the profitability of the liquid milk category and look to export markets for the first time Boosting branded sales, improving the profitability of the liquid milk category and looking to export markets for the first time were the priorities for Arla over the next five years in the UK as it looks to deliver a better price to its farmers owners.As it announced its plans for the next five years, the dairy emphasised it was ‘massively committed’ to the UK and saw a ‘bright future’ for the industry and would be looking to recruit more milk.It follows the launch of the global Arla Group Future26 strategy.BoostHere in the UK, the dairy will also be looking to boost its milk supplies through a combination of increased production from existing farmers and new recruits.The cooperative was looking to build its branded sales and become a household name with Arla Foods UK managing director Ash Amirahmadi saying it was a ‘tried and tested strategy’ to deliver better returns and encourage consumers to engage more with the category. Sustainability would also continue to be a key priority, with Mr Amirahmadi adding farmers needed a sustainable milk price to have the confidence to invest.Mr Amirahmadi said profitability in the liquid sector had been a long-term issue for the industry but there were strategic developments which meant the future would be different.“Sustained growth of demand for dairy globally means there are very credible alternative uses for UK milk,” he said.He said UK consumers have rediscovered their love for dairy during Covid-19 with increased demand also on the domestic market.“If liquid milk wants to hold its own against the competition it has got to deliver a return,” he added.Arla was keen to explore export sales of UK milk, with short term opportunities for exporting milk to its facilities in Denmark and Germany.Export“Today we can get 15-20 per cent more for British milk if we export it,” he said, but added longer term it would be looking outside the UK to export consumer products where they were in demand.As part of its plans, Arla would be starting the ‘first steps’ to recruit more milk in the late spring with it looking to encourage more production from its current farmers and take on board new suppliers.But he admitted it was ‘very difficult’ to encourage producers to increase supplies at the moment.“The very simple answer is we do it by focusing on maximising the farm gate price,” he said.