DENMARK – Danish dairy cooperative Arla Foods has announced plans to close its Brabrand Dairy with plans to move the production operations to other sites in Denmark, Holland and Germany.
The company says that while the European market for yoghurt products is increasing each day, the Brabrand dairy facility has shown inability to expand into this market prompting Arla to shift its production to other facilities to secure future production capacity.
According to the company, this change in site will allow them to focus more on uniform quality of the various fermented milk products such as yogurt, skyr and creme fraiche.
“European consumers are buying more and more yogurt products, and we need to look at how we can secure future production capacity and ensure yoghurt products of a high quality across the European countries.
As we cannot expand production at Brabrand Dairy because of the location and costs of production equipment, we are moving production to competence centres at primarily Danish, Dutch and German production sites,” said Jakob Bernhard Knudsen, senior vice president and Head of Arla Denmark.
The company has already informed the affected employees, with the plant closure, due in mid-2019 expected to affect around 160 employees.
“It is important to us that we help the employees at Brabrand Dairy move on in a good way, either to jobs at other Arla production sites or outside Arla.
And I am pleased that we can maintain and develop more jobs at the Danish production sites, which will take over production from Brabrand Dairy,” said Jakob Bernhard Knudsen.
The inability to increase capacity at Brabrand Dairy plant was cited to be due to high production costs, high priced production equipment and the unsuitable location for production.
Arla was moving most of the operations to the Denmark production site and will move to Slagelse and Hobro Dairies.
Production of Danish brands will continue at the Denmark production site including 1-litre yogurt products Yoggi, Cheasy, A38, Arla Oko and creme fraiche, while the production plants in Sweden and Germany will resume production of smaller products requiring smaller volumes.
“The aim is to create production sites that are experts within the individual products, both in terms of production and development,” added Jakob Bernhard Knudsen.