Arla and German dairy company DMK Group have signed a manufacturing agreement which will see DMK produce 35,000 tonnes of mozzarella a year for Arla.
As a result of the agreement, DMK will rebuild its Nordhackstedt factory into a site which is fully-focused on mozzarella production. DMK will invest €15 million to convert the facility by late 2018.
DMK’s Nordhackstedt facility currently has a production capacity of approximately 70,000 tonnes of produce per year.
Arla will supply DMK with 300-350 million kilos of milk annually for the production of the mozzarella.
The move comes as global demand for mozzarella has increased from both consumers and the foodservice industry.
Peder Tuborgh, CEO of Arla Foods said: “Arla is one of the world’s leading producers of mozzarella cheese, and with this agreement we aim to build on that position to continue to provide consumers and foodservice customers with quality mozzarella in Europe, Asia, USA and the Middle East.”
Both companies also joint own whey protein producer ArNoCo, established at the Nordhackstedt in 2011, and as a result of the agreement, the site’s supply of whey for ArNoCo will also increase.
Tuborgh added: “We are very pleased to sign this important manufacturing agreement that secures access to profitable raw material for our joint venture production at ArNoCo.
Ingo Müller, CEO of DMK Group, said: “We are re-shaping our footprint for our German plants to produce in a more efficient way. Next to this, we are optimizing our portfolio towards more value-creating products.
“This contract manufacturing agreement will enable us to make the next step forward and to weatherproof DMK for the future.”
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