Double digit increases in US sales has prompted Arla to expand its dairy in Hollandtown, Wisconsin, with an eye on burgeoning quality cheese market.
According to a report from DairyReporter.com, citing figures from Rabobank, Arla is the seventh biggest dairy company in the world with sales of Euros6.19 billion (NZ$10.9 billion) in 2009.
The US only accounts for 4.7% of that revenue figure but it is a booming market for Arla having grown 10% in 2009 and with volumes midway through 2010 standing 20% above last year.
Quality cheese is the product of choice for Arla in the US and although the market for premium food products dipped last year, US country manager Susie M•ller Hjorth was quote saying Arla won new contracts with large nationwide chains.
Currently, Arla produces 70% of its products on the US market at dairies in Muskegon, Michigan and Hollandtown, Wisconsin and imports the remaining 30% from its dairies in Denmark.
By expanding its capacity in Hollandtown, a project due to finish in early summer 2011, Arla plans to compete for larger contracts and meet demand for locally produced cheese.
The company sees continued high potential in the market for quality cheese. “Specialty cheese has proven to be a very exciting product segment in the US markets, with its rapid development and sales over the past years,” according to Susie M•ller Hjorth.
Although Americans do not have the same cheese production traditions that exist in Europe, the Arla executive said: “They think differently, as can be seen from their beer production where microbreweries have been challenging the established breweries for years. We’re seeing the same trend in cheese production right now.”
Meeting the needs of the American consumer may require some lateral thinking and innovation. For example, Havarti and blue cheese may now be found at the delicatessen counter but Arla sees potential elsewhere.
“If we can make our way into the sandwich and burger market with our Havarti cheese, our business can grow substantially,” Susie M•ller Hjorth was quoted saying.
