Danish dairy major Arla Foods has proposed closing a UK plant and shifting some production from another in a move that could impact more than 150 jobs.

It is looking at shutting its plant in Settle, North Yorkshire, in northern England and moving production to its Lockerbie site in Scotland. Some operations from a facility in Leeds, also in northern England, will also be shifted to Lockerbie.

Currently, the Settle site employs 128 workers, with an additional 450 at Leeds.

In the statement sent to Just Food,, the Cravendale milk and Arla skyr manufacturer said the proposed changes will affect “some colleagues” at Stourton and “all” Settle staff.

A company spokesperson said the planned move puts 152 jobs at risk but said approximately 90 new positions will be created in Lockerbie.

The dairy co-op said it plans to invest €107.7m ($112.8m) in the Lockerbie plant.

The transition will occur in the second half of 2026, if the plans proceed. Arla is now initiating a “period of consultation” with affected workers.

Deanne Ferguson from the GMB trdes union, which represents workers at the affected plants, expressed concern over the closure plan, stating that it would have “a significant economic and social impact”.

Ferguson said: “We will now begin urgent discussions with Arla to explore all possible options to protect jobs,” [and to] “consider all available alternatives to compulsory redundancies.”

Explaining the rationale behind the closure, the Arla spokesperson said: “Unfortunately we are limited by the land available in Settle, so we are proposing to close this site and to reinvest into Lockerbie, which has the required space and buildings.”

Arla intends to set up a centre for the production of UHT and lactose-free milk at the Lockerbie site.

Arla executive vice-president and head of supply chain David Boulanger said: “We have chosen Lockerbie as a future UHT competence centre in the UK as it allows us to achieve economies of scale, improve efficiency and strengthen our resilience. Furthermore, it is close to a large milk pool, which provides some additional sustainability benefits.”

This development comes after Arla’s previous announcement of more than €355m in investments across its UK dairies, which includes €210m for mozzarella production at the Taw Valley creamery in Devon.

Last week, Arla announced its 2024 results, with its revenues and net profit improving to €13.8bn and €401m, respectively, for the year.

Looking ahead to 2025, the company forecasts revenues of €14.5bn-€15.3bn, “driven by the high dairy price level”. However, high prices and “consumer uncertainty” are projected to put pressure on branded volume-driven revenue growth, which is estimated to be down 1-2%.

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