USA: Arla Foods and Dairy Farmers of America to open cheddar plant

Arla Foods, the Danish dairy cooperative, is to collaborate with its US counterpart Dairy Farmers of America to open a cheddar cheese plant in the USA, according to a report in Co-operative News.

Located in Linwood, NY, the plant will source up to 70,000 tonnes of raw milk from eight DFA members situated locally. Arla will invest 20% of the required capital of $53 million and will also own 20% of the business, with DFA owning 70%.

Commenting on the deal, Arla Foods chief executive Peder Tuborgh said: "Together with Dairy Farmers of America and eight of their farmers, who will supply the raw milk, we will explore the opportunities in building premium quality standards into the cheddar category through the Arla brand. Adding cheddar to our US portfolio will make us more attractive to the retailers and help increase the sales of our European products made from owner milk".

Arla Foods USA head Don Stohrer Jr added: "American families are increasingly looking for food products that they can feel good about serving and consuming from a better-for-you standpoint. This is exactly the position we have created for the Arla brand with its authenticity, transparency and great taste. It’s an attractive position that currently doesn’t exist in the USA dairy aisle or the cheddar segment. Our expectation is that the new cheddar products will create a halo effect for the cream cheese and other Arla branded products".

Production is expected to start in the autumn of 2017.

Source: Co-operative News