Arla Plans Further Investment as Protein Demand Surges
Arla Foods is preparing to expand investment in its ingredients operations after reporting stronger demand for dairy proteins. Chief executive Peder Tuborgh described demand for protein ingredients as “super high”. The company linked the market conditions to interest in nutrition, sports nutrition and products with high protein content.
Arla Foods Ingredients generated €867 million in revenue during the first six months of 2026, a 19.3% increase compared with the same period in 2025. Higher whey-protein prices contributed to the result, while volumes of value-added ingredients also rose. Arla said demand was supported by protein-focused diets and nutrition associated with GLP-1 weight-management treatments.
The cooperative’s branded protein products also recorded growth. Sales of Arla Skyr increased by 39.6% in the first half, while Arla Protein grew by 34.4%. Group revenue reached €7.6 billion, compared with €7.5 billion a year earlier, and net profit rose to €213 million from €158 million. Strategic branded volume-driven revenue increased by 6.7%.
Investment and capacity
Arla invested €322 million across its markets during the first half of 2026. It also approved a €300 million project for a new cheese dairy at its Götene site in Sweden. The facility is expected to lift the site’s annual milk intake to about 1 billion kilograms, roughly twice its current level. Production is scheduled to start in 2030.
The Götene project concerns cheese production rather than protein ingredients. Arla’s leadership has indicated that additional investment in ingredients is likely as demand expands, with a focus on higher-value dairy components. The cooperative has reported that the ingredients business has benefited from both firmer whey prices and increased demand for specialised nutritional products.
Commodity pressure and merger
Arla’s protein business performed against weaker conditions in commodity dairy markets. High milk availability in Europe put pressure on commodity prices and reduced the value of milk in the first half. Arla’s performance price fell to 43.6 euro cents per kilogram, from 57.5 euro cents per kilogram in the first half of 2025. The company said branded volume growth, protein demand and operating efficiencies supported its overall result.
Arla completed its merger with German dairy cooperative DMK on June 1st 2026. The combined cooperative has about 11,200 farmer owners, 28,800 employees and a milk pool of approximately 20 billion kilograms. Arla’s first-half accounts included only one month of DMK operations.
Arla raised its full-year guidance for strategic branded volume-driven revenue growth to between 4% and 6%, from an earlier range of 1% to 3%. The cooperative expects dairy markets to remain volatile because of high milk supply, while reporting continued consumer demand for nutritious dairy and protein products.
