The demand for protein-rich dairy products is growing. Arla is therefore investing DKK 470 million (€62.8m) in expanding the production of skyr and cottage cheese in Germany and Sweden. The investments will make it possible to keep up with demand and create greater value from the owners’ milk, the co-operative says.

More consumers in Europe and the rest of the world are looking for food that tastes good, is easy to use in everyday life and can be part of an active lifestyle and a balanced diet. Skyr and cottage cheese have become regular items in many people’s meals in line with the growing interest in protein-rich foods. This can be seen in sales. In three years, Arla’s sales of skyr measured in volumes have increased by more than 33% in the European markets. In the same period, sales of cottage cheese have increased by 25% across Arla’s markets. Demand has grown so fast that dairies across the industry are investing in being able to produce more.

Therefore, Arla is now investing DKK 262 million (€35m) in skyr production in Upahl in Germany and DKK 212 million (€28.4m) in the production of cottage cheese in Falkenberg, Sweden.

“Consumers’ eating habits are changing, and more people are demanding products with a high protein content, which at the same time taste good and are easy to use in everyday life. Skyr and cottage cheese are popular in many countries, and with the investments, we want to make the products available to even more people,” says Peder Tuborgh, CEO of Arla Foods. Skyr is a clear example of the growing interest in protein-rich foods. The product has roots in Nordic dairy traditions and has become one of the fastest growing categories among dairy products in Europe.

Arla’s Upahl dairy in Germany is already an important part of Arla’s total skyr production in Europe, and the expansion will make it possible to keep up with demand and develop the market for skyr further. The investment builds on several years of work to expand Arla’s skyr production. In several markets, demand has grown faster than production capacity has been able to keep up with over a long period. Since 2023, Arla has invested DKK 381 million (€50.9m) in increasing capacity and streamlining skyr production at dairies in Denmark, Germany and Sweden. The new investment in Upahl comes on top of this.

Cottage cheese is becoming increasingly popular. Arla’s plant in Falkenberg, Sweden is Europe’s largest production site for cottage cheese.

Previously considered a niche product, cottage cheese is among the products that have most clearly benefited from the global interest in nutrition. Over the past year, the cottage cheese market has grown by 13% in Sweden, 37% in Denmark and the UK and 38% in the Netherlands. Overall, Arla is the largest supplier of branded cottage cheese products in its European markets, driven in particular by a strong position in Sweden and Denmark. The investment in Falkenberg will help Arla to meet the growing demand in both Sweden and other European markets.