Consumers in Middle Eastern are increasingly demanding fresh, locally produced dairy-products. Photo: Håkan Lindgren.

As part of Arla Foods’ plans for doubling sales to the Middle East, the production of processed cheese will be transferred from Bislev Dairy in Northern Jutland, Denmark, to Saudi Arabia. Between 60-70 employees at Bislev will be affected.

The move is part of Arla Foods’ wish to expand and maintain its position as market leader in the Middle East within cheese, butter and cream. The aim is to increase sales from the current 60,000 tons per year to 120,000 tons by 2010.

”Middle Eastern consumers are increasingly demanding fresh, locally produced products,” said Executive Director, Finn Hansen, the Overseas Division. “The intention is for new products produced in the Middle East to account for 20% of our turnover there.”

Arla’s sales in the region currently total approximately DKK 2.5 billion.

A cost-benefit analysis of the consequences of relocating the production of processed cheese to Arla’s Saudi dairy, Danya, in Riyadh, shows substantial advantages. The current feta production at Bislev will continue as before.

The decision to transfer production of processed cheese to Danya means that employment levels at Bislev Dairy will fall by 60-70 persons by the autumn of 2006.