Arla sues UK producer

Arla Foods is seeking damages close to ‚£2 million (€2.8m) against a producer for breach of its obligation to supply milk to Arla Foods UK.

The UK branch of the Scandinavian dairy processor says it has served proceedings on Arla Foods Milk Partnership members – the Barnes Partnership/Withgill Farm Limited. The prosecution arose as Barnes sought to bring its contract to an end before the 12-month notice period has expired by entering into an agreement to sell its farm.

“Under the terms of its AFMP milk supply contract the Barnes partnership/Withgill Farm Limited remains obliged to supply all of the raw milk, produced at the farm to Arla Foods for the remaining period of the notice,” says Arla.

It is the first time that Arla has sought to prosecute a member. Hanne Sondergaard, deputy chief executive and responsible for milk procurement, says: “It is very disappointing that we have found ourselves in the position where we have had to go down this route. It was not our desired option in dealing with this matter. We made every possible effort to resolve the situation through correspondence and without having to issue a formal claim but unfortunately, were left with no alternative.”