One in four British dairy farmers to benefit from a share of the £31 million windfall from Arla
Arla Foods, the country’s leading farmer-owned dairy company, has announced that its British owners will receive £31 million as their 2016 year-end bonus. Arla is owned by 12,000 dairy farmers across Europe, 2,500 of whom are British and make up almost a quarter of all British dairy farmers.
Once a year, Arla distributes its profits equally between all of its farmer owners in its so-called supplementary (13th) payment [1]. This will be paid as a cash bonus this Friday, 10 March. £7 million of the windfall will be invested into each farmer’s individual savings accounts for each farmer to build up a lump sum should they decide to leave the cooperative.
The 13th payment is equally distributed to all farmer owners; proportionate to the amount of milk they supply rather than based on their equity investment in Arla. This year, the 13th payment is equivalent to an average of almost £9,000 to each Arla farmer across England, Wales and Scotland.
The bonus was agreed by the company’s Board of Representatives, which is almost wholly comprised of elected farmer owners and includes 20 British farmers. In 2017, this will increase to 23 British farmers, reflecting the increasing strength of British farming within the dairy cooperative.
Farmer owner and Arla Foods Board Director, Jonathan Ovens, said: “The 13th payment is one of many important benefits for farmer owners like me and is particularly welcome as we begin to come out of a difficult year. It enables us to invest in our farms, and also save for the future.
“It’s an annual benefit and a return on my investment that I couldn’t achieve elsewhere. It’s good to work together with Arla to back British dairy farming. As we need to increase the country’s milk production to meet growing demand, it’s also reassuring that Arla promises to collect every drop of milk I produce at the Arla price.”
Ends
1 Arla farmer owners received a monthly payment for their milk, called the milk price, based on the amount of milk they have provided. The ‘13th Payment’ is so-called as it sits outside the usual monthly payment structure, based on the cooperative’s profit. Some farmers choose to receive their proportion as a cash payment; some use it towards their original investment in the cooperative.
Arla Foods is a global dairy company and co-operative owned by 12,000 dairy farmers with circa 2,500 of whom are British.
Dating back to 1881, Arla’s purpose is to secure the highest value for its farmers’ milk, while creating opportunities for their growth. With production facilities in 11 countries and sales offices in a further 30, Arla is the world’s fifth largest dairy company and largest supplier of organic dairy products. Arla has a total of more than 18,000 colleagues and its products are sold under the well-known brands Arla®, Lurpak® and Castello® in more than 100 countries.
Arla Foods UK is the largest dairy company in the country and is home to leading dairy brands Anchor®, Arla Cravendale®, and Arla Lactofree® with a turnover of €2.2 billion. The UK is largest market within the Europe Zone, contributing 35% of the zone’s turnover and also comprises 25% of the Group revenue.
As well as being a leading supplier of fresh milk, number one in butter, spreads and cream, Arla is the UK’s largest cheese manufacturer. It has also built the world’s largest fresh milk facility located at Aylesbury that later this year will become the first net zero carbon site of its kind. The UK business has a team of approximately 3,500 colleagues located at its dairies, creameries, distribution centres and head office.