Arla Foods bolsters net-zero campaign with new US$4.6B investment in sustainable dairy production

DENMARK – Dutch multinational dairy cooperative, Arla Foods has unveiled a five-year strategy to bolster its commitment to become a net-zero business by 2050. 

The farmer-owned dairy cooperative said it is prepared to increase its investments by more than 40% to over €4 billion (US$4.6 billion) in the next five years to support sustainable dairy across its value chain. 

The investment, according to Arla, will be channeled to sustainability initiatives, digitalization, new production technologies, and product development.  

Arla has also announced a new retainment policy allocating a higher additional payment of €1 billion (US$1.1 billion) over the next strategy period to support its farmer owners on their sustainability journey. 

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The new investment builds on a commitment by Arla farmers to accelerate their reduction of greenhouse gas emissions toward the science-based 30% goal in 2030.  

Today, they are among the most climate efficient dairy farmers globally, producing milk with an average of 1.15 kg CO2e per kg of milk.   

Across its operations, Arla has also raised its target to a 63% reduction of greenhouse gas emissions by 2030. 

The company plans to deliver on this promise by accelerating its conversion to green electricity, investing in fossil-free fleets, making all packaging recyclable and having zero virgin plastics in branded packaging by 2030. 

Arla’s investment in suatianable dairy follows market trends where consumers are becoming more conscientious and expect the food they eat to be healthy and affordable and produced responsibly and sustainably. 

Additionally, sentiment against dairy production has been growing with one of Arla dairy facilities being blocked recently by activists calling for the company to fully transition to plant-based dairy by 2025.  

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“We are at a defining moment for dairy and our farmer owners,” says Arla Foods CEO Peder Tuborgh.  

“The twin challenges of climate change and malnutrition are the most difficult facing our global food systems. It requires urgent action, and dairy is part of the solution. If there ever was a time to step up and create the future of dairy, it is now.” 

Tuborgh believes that with its Good Growth 2020 strategy, the company has created the right recipe to grow its brands, deliver efficiencies and invest in sustainable actions across our value chain while securing a competitive milk price for its farmer owners.  

Arla Foods also recently examined how dairy farming can help improve soil biology, carbon capture, water quality and biodiversity via regenerative farming methods. 

Earlier this year, the cooperative revealed it is keeping more renewable energy within its value chain by purchasing guarantees of origin directly from its farmer owners.  

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