A spokesperson for Arla told DairyReporter.com emerging markets were seeing a rapid growth, in terms of population and wealth, which was driving a need for value-added food products such as milk powder.
“This is a big investment and by building this plant together we can work more efficiently and minimise the risk of the two companies,” said Peder Tuborgh, CEO of Arla Foods.
DMK said it had been looking for suitable partners in the northern region of Germany over the past few months.
Josef Schwaiger, CEO and spokesman for the DMK Management Board said the firm already had a production operation for milk powder and butter at its Hohenwestedt site, but that this could be built up even more efficiently with other dairy companies.
“The necessary investments would amount to only 30 per cent of the cost of building an entirely new facility. We have presented this offer to the dairies in Schleswig-Holstein, but the response from the industry has been rather modest,” he said.
The companies both complement each other in terms of distribution, said Arla.
“Well-developed sales channels are essential in the highly competitive milk powder sector, in order to participate in the growing markets and to generate added value,” said the firm.
A spokesperson for DMK told DairyReporter.com the firm could not currently provide any further information on the collaboration.