Danish-based dairy giant Arla Foods has said it plans to transfer production of processed cheese from Bislev Dairy in Northern Jutland, Denmark to Saudi Arabia, leading to the loss of 60-70 jobs in Denmark.

The move is part of Arla Foods’ plans to expand and maintain its position as market leader in the Middle East within the cheese, butter and cream sectors. 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 Finn Hansen, executive director of Arla’s 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 DKK2.5bn (US$0.4bn).