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Mixed first half year for dairy giant Arla
Dairy group Arla has had a mixed first half of 2024. The advance price paid to members was higher than in the first half of 2023. Profit was also higher. The performance price was lower, while turnover was also half a billion lower than in the first half of 2023.
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For the second half of the current year, Arla is optimistic, but also cautious. The demand for dairy products is increasing, while the availability is smaller. That should result in higher milk prices, but it is exciting whether the consumer will accept the higher prices for milk, yoghurts, cheese and butter.
For Arla members it was good to see that the advance price in the first half of 2024 increased by at least €5,00 per 100 kilos to €45,00 (the price was €39,90). Turnover did decrease from €7,1 billion a year earlier to €6,6 billion in the first half of 2024. Profit, on the other hand, increased from €103 million to €167 million.
Arla's higher profit may also be due to the increased sales of branded products. Last year, sales of branded dairy products fell sharply, in the first half of this year Arla registered 4,1% growth again. Apart from that, the generally higher dairy prices also helped to increase sales.
Milk supply in the first months of this year was stuck at 7 billion kilos, the same as in the first half of 2023. Arla members did their best to produce milk more sustainably, not least because this simply generates extra money. The average sustainability score rose from 49 points last year to 53 points up to and including June. Dutch Arla members earned an average of €2,00 per 100 kilos of extra milk money in August.