Arla Foods has announced it will close its Gefleortens dairy business in Sweden due to the financial challenges that the unit faces.
Gefleortens merged with Arla in 2017. The business has 45 permanent employees.
Arla drew attention to increased competition in the dairy market and demands for new types of food.
It added that the market requires specialised dairy products, such as lactose-free products, which Gefleortens cannot offer.
According to Patrik Hansson, Arla’s Sweden manager, Gefleortens management has carried out an efficiency programme to reduce the number of products and employees.
“But unfortunately, we have not been able to increase sales from Gefleortens,” he said.
The Gefleortens brand will remain, although the milk will be packaged in another dairy together with milk from other farms.
Last year, Arla Foods started a transformation programme that aims to save more than €400 million by the end of 2020 through improved efficiency.
Called Calcium, the initiative is creating efficiencies in order to improve returns to Arla farmer-owners and to reinvest into business areas that fuel growth.
© FoodBev Media Ltd 2019