Arla says inflation hitting sales of some products

Lurpak butter, Castello cheese have suffered declines
calendar icon 9 February 2023
clock icon 1 minute read

Dairy cooperative Arla Foods saw revenue jump almost a quarter last year thanks to higher prices but said on Thursday that recession fears had discouraged consumers from buying its key brands, such as Lurpak butter and Castello cheese, reported Reuters

"2023 will undoubtedly be another difficult year with the challenging economic environment," chief executive Peder Tuborgh said in a statement.

Owned by more than 8,900 farmers in Denmark, Sweden, Britain, Germany, Belgium, Luxemburg and the Netherlands, Arla said sales in 2022 had reached 13.8 billion euros ($14.8 billion), up 23.2% on 2021.

But rising prices had prompted consumers in Europe and Africa to switch to cheaper products and consume less dairy products in general, the Denmark-based cooperative said.

In 2022, volumes of Lurpak butter, which is sold in 95 countries, had declined by 7.6%, while the amount of Castello cheese it had sold had decreased by 6.9%.

"We also expect to see a continued slow-down in branded growth due to reduced buying power of consumers and fear of recession," Tuborgh said.

($1 = 0.9317 euros)

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