Arla Foods’ Lockerbie site to get £90m additional investment

Arla Foods has proposed to invest nearly £90 million into its Lockerbie site in Scotland to support the farmer owned cooperative’s future growth ambitions.

Alongside the £300m site investments announced in 2024, which included £34m investment into Lockerbie’s cheddar production, the food manufacturer has recently announced a proposal to further increase the investment in Lockerbie to enable it to future proof its UK production.

The UKs largest dairy cooperative is proposing to create a Centre of Excellence for the production of UHT and Lactofree milk at Lockerbie, which could create new roles in the local area.

As a result, Arla has proposed the closure its Settle site, and part of the proposal could also impact some colleagues based at Arla’s Stourton Dairy, however the business does not envisage any redundancies for Stourton Dairy employees.

Arla said it will enter into a collective consultation period with all colleagues impacted by the proposal.

“The proposals form part of our strategy to strengthen our manufacturing network and futureproof dairy production in the UK, and whilst this is an exciting announcement for Lockerbie our priority right now is to support our colleagues,” Fran Ball, VP of production at Arla Foods, said.

“At Arla we are committed to supporting everyone through periods of change and we understand that this will be a time of uncertainty for colleagues. We will be entering into a period of consultation with everyone affected by these proposals.”

The development follows the announcement of Arla’s 2024 annual results, whereby the dairy cooperative confirmed it made record investments of more than €1 billion globally in 2024. The investments included over £300 million across Arla’s UK sites, including £179 million in state-of-the-art technology at its Taw Valley creamery in Devon, which will allow the business to create mozzarella in the UK.

Speaking about the proposals, Bas Padberg, managing director of Arla Foods UK, said: “The proposed investment into Lockerbie showcases our commitment to driving change in the UK, and supporting the future of British dairy. There is an increasing focus on the role the UK food industry plays in helping to tackle the health crisis and provide good food to nourish a growing population. We are aware that this proposal has the potential to impact colleagues across some of our UK sites, and our priority is to support them through this challenging time.”

Arla Foods UK board director, and Arla farmer, Arthur Fearnall, said: “We are incredibly proud to see this significant investment proposed for Arla’s Lockerbie site. We’re excited to see how this progresses over the coming years as we continue to work together to ensure all Arla farmer owners receive the best price for their milk.”