Arla Foods

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Arla Foods
Type Agricultural cooperative
Industry Dairy
Founded 2000 (2000)
Headquarters Aarhus, Denmark
Area served Worldwide
Key people
  • Peder Tuborgh, CEO
  • Povl Krogsgaard, Vice CEO
  • Andreas Lundby, Vice CEO
  • Åke Hantoft, Chairperson
Revenue 63,114 Billion DKK(2013)
Operating income 1,413 Billion DKK(2010)
Net income 1,253 Billion DKK(2010)
Employees 18,112 (2013)
Website http://arla.com

Arla Foods is a Danish cooperative based in Århus, Denmark, and the largest producer of dairy products in Scandinavia. Arla Foods was formed as the result of a merger between the Swedish dairy cooperative Arla and the Danish dairy company MD Foods on 17 April 2000.

Arla Foods is the seventh largest dairy company in the world measured by turnover[citation needed]. Among the cooperative dairy companies Arla is the third largest in the world[citation needed]. At the start of 2010, 7,625 Danish and Swedish cooperative members owned the cooperative[citation needed].

Arla Foods has three major brands: Arla, Lurpak and Castello cheeses that are sold worldwide. The Arla Brand is both a co-operative brand and a brand across all product categories. The Lurpak brand of butter and spreads is owned by the Danish Dairy Board, and Castello is a cheese brand including blue cheese and yellow cheeses.[1][2] The name Arla derives from the same word as the English word "early" and is an archaic Swedish term for "early (in the morning)".

Arla Foods incorporates Arla Foods Ingredients, a former division established as an independent subsidiary in 2011. The company develops and manufactures milk-based ingredients, primarily functional and nutritional milk proteins, bioactive phospholipids, minerals, permeate and lactose for the food industry. Head office is located in Denmark.

Arla Foods Ingredients has one wholly owned production plant in Denmark, with joint venture production at facilities in Argentina and Germany. In early 2011, Arla Foods and DMK formed the joint venture company ArNoCo GmbH & Co. KG, to produce whey proteins for the food industry.

History[edit]

The Swedish "Arla ekonomisk förening" and the Danish "MD Foods" became one company, "Arla Foods amba" in 2000. The two dairy companies share a similar history:

History of Arla Foods in Sweden from 1881 to 1999

1881: The first co-operative dairy is established at Stora Arla Gård in Västmanland under the name of Arla Mejeriförening.

1915: Arla’s history begins when Landtmännens Mjölkförsäljningsförening is formed. The name is later changed to Mjölkcentralen (MC). Subsequent years see a substantial number of larger and smaller dairies merging with Mjölkcentralen and in connection with a number of mergers in the early 1970s, it is proposed that the company should have a new, common name.

1945: Mjölkcentralen acquires NEN’s village dairies.

1949: The MC cow, designed by Mjölkcentralen’s ad-man, Karl Thunberg, is registered as a trademark

1959: The dairy associations in the county of Skaraborg merge with Mjölkcentralen.

1971: Mjölkcentralen amalgamates with Lantbrukarnas Mjölkcentralen in Gothenburg, Sydöstmejerier and the Őrebro area’s dairy association begins.

1974: Registration of the name Mjölkcentralen Arla.

1975: Mjölkcentralen changes name to Arla and acquires its new logo: the Arla Cow.

1992: Arla takes a stake in the Copenhagen-based dairy, Enigheden, owned by Kløver Mælk of Denmark.

1999: Arla has 65% of the Swedish milk production.

History of Arla Foods in Denmark from 1882 to 1999

1882: The first co-operative in Denmark is established in Hjedding. In the following decades, the number of co-operative dairies rises dramatically.

1945: There are 1,650 co-operative dairies in Denmark

1963: The concept of a nationwide dairy is aired for the first time.

1970: Mejeriselskabet Danmark (MD) is established on October 1 by four dairy companies and three individual dairies. The company starts out with a milk volume of 384 million kg.

1970s and 1980s: Various dairies and dairy companies across Denmark join Mejeriselskabet Denmark through mergers or acquisitions.

1978/79: The volume of milk exceeds 1 billion kg for the first time.

1988: The company changes name to the more international MD Foods.

1989: MD Foods International A/S is formed for the purpose of acquiring dairies abroad.

1990: MD Foods International acquires the UK’s fifth largest dairy company, Associated Fresh Foods.

1992: MD Foods and Denmark’s second largest dairy company, Kløver Mælk, sign a financially binding cooperation agreement. MD Foods International makes further acquisitions in the UK.

1996: There are 15 cooperative dairies left in Denmark, including MD Foods.

1999: MD Foods and Kløver Mælk merge to become MD Foods, gaining 90% of the Danish milk production.

Arla Foods' history from 2000 and forward

Hirtshals Andelsmejeri, an Arla Foods dairy in Hirtshals, Denmark

The two companies behind Arla Foods amba, is the Danish MD Foods and the Swedish Arla

The founding of Arla Foods

1995: MD Foods and Arla begin to co-operate

1999: Plans for a merger between Arla and MD Foods take shape and during the autumn, the owners – the cooperative members, agree to the proposal and MD Foods and Arla announce their merger.

2000: Arla Foods amba is formed on April 17

2001: On June 27, Arla Foods publishes a new five-year strategy plan which means the closure of 17 dairies in Denmark and Sweden and the redundancies of approx. 1,000 people.

2002: The cooperative members in Hellevad Omegns Andelsmejeri agree (63 votes for and 50 against) to a merger with Arla Foods with effect from 30 September 2002.

2004: On 2 November, Arla Foods’ Canadian subsidiary agrees to buy the Canadian cheese importer and producer, National Cheese Company Ltd.

2005: The planned merger between Arla Foods and the Dutch Campina break down in April and Arla’s CEO Åke Modig leaves the company. Peder Tuborgh is appointed CEO in June.

2005: On August 26, Arla Foods and the Chinese dairy company, China Mengniu Dairy Company, begin a partnership for the production of milk powder in the Chinese market.

2006: On January 27, Arla Foods buys the speciality dairy, White Clover Dairy in Wisconsin, USA. The purchase of Wisconsin-based White Clover Dairy, a company with 170 employees, on 26 January 2006, provided direct access to the U.S. market (White Clover had produced Arla products under license since 1998).[3]

2006: On June 26, Arla Foods announces the purchase of the privately owned dairy Tholstrup Cheese. The purchase gives impetus to Arla Foods’ strategy to strengthen its international brands.

2006: On November 8, Arla Foods announces the purchase of 30 per cent of the shares in the Finnish dairy company, Ingman Foods Oy Ab. The purchase is approved by the EU on January 16, 2007.

2007: On March 27, Arla Foods merges with Express Dairies in the UK. The merger creates the a UK supplier of dairy products under the name of Arla Foods UK plc.

2008: Production from the Swedish fruit juice factory in Alingsås is relocated to Rynkeby Foods in Ringe during the first half of 2008.

2008: On January 8, Arla Foods acquires the remaining 50 per cent of the shares in Cocio Chokolademælk A/S.

2008: UK farmers become part-owners of Arla Foods UK. To give the British farmers in the supplier group, Arla Foods Milk Partnership (AFMP) joint ownership of Arla Foods’ UK subsidiary, Arla Foods UK, 10,000 Swedish, Danish and UK milk producers unite in a new joint venture which, from May 14, 2008, holds 7 per cent of Arla Foods UK.

2008: On July 1, Arla Foods acquires Borup Andelsmejeri in North Zealand.

2008: Arla Foods acquires the remaining 70 per cent of the shares in the Finnish Arla Ingman Oy AB which becomes a fully owned subsidiary.

2009: Hirtshals Co-operative Dairy joins Arla

2009: Authorities approve: Arla Foods to buy Fresh Nijkerk from FrieslandCampina

2011: Authorities approve: Arla Foods merger with German dairy company Hansa Milch

2011: Arla dairy swallows the German dairy Allgäuer-Käsereien GmbH, raising it to the seventh-largest dairy company in Germany. Later the German market is being upgraded; Germany and the Netherlands get to the Arla Consumer Germany & Netherlands a separate business unit.

2012: Arla Foods merges with Milch-Union Hocheifel in Germany, and Milk Link in Great Britain.

2013: Arla opens the world's largest fresh milk plant in Aylesbury, UK

History of Arla Foods Ingredients

The first pilot production of whey proteins took place in 1976 in the cellar of HOCO milk powder plant in Holstebro, Denmark. Arla Foods Ingredients – initially called Danmark Protein – was established soon after.

Four years later, the company inaugurated the world’s largest factory for the production of whey protein concentrate and lactose.

In 1994, MD Foods acquired Danmark Protein, which then became part of MD Foods Ingredients, the division responsible for sales of milk powder. The division’s name changed to Arla Foods Ingredients when Arla and MD Foods merged in 2000.

A joint venture agreement with SanCor, one of the largest dairy companies in South America, resulted in the construction of a second production plant in Argentina in 2002.

In 2011, a joint venture agreement with the German dairy company DMK marked the launch of an investment plan to expand capacity at Arla Foods Ingredients’ whey processing plant in Denmark and establish a new whey processing plant in Germany.

Functional ingredients[edit]

Functional milk proteins from Arla Foods Ingredients are used in bakery products, cheese, ice cream, fermented dairy products, meat and ready meals/fine foods.

Nutritional ingredients[edit]

Arla Foods Ingredients develops whey-derived bioactive ingredients for infant nutrition, clinical nutrition, sports nutrition and functional food.

Ingredients include:

Middle East boycott over Muhammad cartoons[edit]

Arla's sales were seriously affected by a boycott of Danish products in the Middle East in 2006. Transnational anger among Muslims over satirical cartoons of Muhammed was the immediate cause of this. After the Danish government refused to condemn the cartoons or meet with eleven concerned ambassadors from Muslim nations, a boycott was organised, starting in Saudi Arabia and spreading across the Middle East. The Middle East is Arla's largest market outside of Europe.

On 3 February 2006, the company said that sales in the Middle East had stopped completely, costing the company US$2 million a day.[4] Soon after the boycott began to affect Arla's sales, the Danish government met with Muslim ambassadors, the newspaper issued apologetic statements. Unfortunately for Arla, the boycott continued undiminished for some time.

In March 2006, Arla took out full-page advertising in Saudi Arabia, apologising for the cartoons and indicating Arla's great respect for Islam in the country. This raised controversy back in Denmark, where women's organisations and some Danish politicians criticised Arla, and called on a lot of Danish women to boycott Arla's products in Denmark.

In April 2006, the company said that its products were being placed back in shops in the Middle East. Before the boycott, it supplied 50,000 shops in the area. It announced that many of its largest clients in Saudi Arabia would start selling its butter and cheese on 8 April.[clarification needed] Arla has started sponsoring humanitarian causes in the Middle East in order to reduce horrid feelings from consumers.[5]

2008 Chinese milk scandal[edit]

Arla Foods has a joint venture company Arla Mengniu, in association with Mengniu,[6][7] one of the companies involved in the 2008 Chinese milk scandal involving the addition of melamine to milk products.

Executive director Jais Valeur stated that: "We are part of this [crisis] – just as we're a part of the solution."[8]

See also[edit]

References[edit]

  1. ^ "Arla genom åren" (in Swedish). Arla Foods. Archived from the original on 2007-07-02. Retrieved 2007-07-19. 
  2. ^ "Historien bakom namnet Arla Foods" (in Swedish). Arla Foods. Archived from the original on 2007-07-02. Retrieved 2007-07-19. 
  3. ^ "Arla Foods acquires US dairy company", Nordic Business Report,January 26, 2006
  4. ^ "Arla cheesed off over Middle East boycott". The Daily Telegraph. 2006-02-04. 
  5. ^ "Arla returns to the Middle East". BBC. 2006-04-07. 
  6. ^ "Mengniu shareholders cash in $165 million By Anette Jönsson". 5 August 2008. Archived from the original on 1 October 2008. Retrieved 2008-09-25. 
  7. ^ "Big sky country offers niche opportunities - SPECIAL REPORT". Retrieved 2008-09-26. 
  8. ^ "Mengniu Food Awaits Testing Equipment 09/22/2008". Archived from the original on 30 September 2008. Retrieved 2008-09-25. 

External links[edit]


Coordinates: 56°07′11″N 10°09′26″E / 56.1198°N 10.1572°E / 56.1198; 10.1572