UPDATE: DENMARK: Arla Foods wants fifth of sales from emerging markets
Arla eyes emerging markets
Arla Foods has told just-food its new strategic plan calls for it to double the proportion of dairy sales derived from emerging markets by 2017.
Arla said today (11 January) it has brought forward a new strategy designed to increase its presence in emerging markets up to 2017. The group expects the abolition of EU milk quotas in 2015 to lead to increased milk production, much of which cannot be swallowed by mature dairy markets in Europe.
The group has not given specific sales targets for the 2017 strategy, which will supercede a current plan to hit DKK75bn in sales by 2015.
However, speaking to just-food following the launch of the new strategy, an Arla spokesperson said: "By 2017 our strategic consumer business in Russia, China, Middle East & Africa plus global ingredients sales must make up 20% of our global revenue, compared to 10% today."
Arla said it plans to double global ingredients sales over the period, to DKK5bn (US$888m). "We have an opportunity to achieve profitable long-term positions in markets outside the EU," said Arla's chairman, Åke Hantoft.
When asked how the Danish dairy co-operative plans to measure profitability, the group spokesperson added: "Our aim is to pay a milk price to our cooperative owners which is 3-5% above our comparable competitors in Europe."
At the same time as seeking a greater presence in non-EU markets, Arla's 2017 document also recognises the need for DKK2.5bn in efficiency savings in Europe.
The spokesperson said it is "impossible to say at this point" whether this could lead to job losses via streamlined production.
But, he added: "The effeciency measures are part of our daily work to reduce cost and not necessarily focused on site closures. When commenting on an upcoming period as long as five years it is, however, impossible to rule anything out."
The rapidly expanding Chinese food sector has long been a focus for multinationals looking beyond developed western markets for expansion. However, it isn't just the international food Goliaths - with...
Dairy in Denmark industry profile provides top-line qualitative and quantitative summary information including: market size (value 2007-11, and forecast to 2016). The profile also contains description...
Dairy in Europe industry profile provides top-line qualitative and quantitative summary information including: market size (value 2007-11, and forecast to 2016). The profile also contains descriptions...
Danone is to make another attempt to tap into the booming demand for fresh dairy products in China. The French food group is teaming up with Chinese dairy giant Mengniu, the largest yoghurt producer i...
Dairy in Sweden industry profile provides top-line qualitative and quantitative summary information including: market size (value 2007-11, and forecast to 2016). The profile also contains descriptions...
- Focus: Danone CEO Faber puts stamp on business
- Cleaning up Tesco will have mixed supplier impact
- General Mills US "priority" categories gain share
- The just-food interview: Doux CEO Arnaud Marion
- Interview part 2: BRF CFO Augusto Ribeiro
- General Mills outlines "aggressive" NPD drive
- Coles supplier payments broke competition law
- General Mills earnings drop one-third
- Kraft to reappraise business, says new CEO Cahill
- PepsiCo opens snacks plant in Saudi Arabia