Arla has announced a new investment worth £90 million in its Lockerbie plant in Scotland, but workers at two plants in Yorkshire may lose their jobs.
As a result of the new investment proposal, Arla said it was looking to close down its Settle site in North Yorkshire, and a 'collective consultation' will soon launch.
The dairy co-operative also said there could be 'potential impact' for workers based at the Stourton site, near Leeds, West Yorkshire.
Arla said that it had an ambition to "continue its growth to support UK manufacturing and the future of British dairy".
As part of this, it's £90m investment for the Lockerbie plant would enable it to "future proof UK production".
The co-op is proposing to create a Centre of Excellence for the production of UHT and Lactofree milk there, which could create new roles in the local area.
For the two Yorkshire plants, Arla said it would enter into a collective consultation period with all workers impacted by the proposal.
Fran Ball, VP of production at Arla Foods, said: “The proposals form part of our strategy to strengthen our manufacturing network and futureproof dairy production in the UK.
"And whilst this is an exciting announcement for Lockerbie, our priority right now is to support our Yorkshire colleagues.
"At Arla we are committed to supporting everyone through periods of change and we understand that this will be a time of uncertainty for colleagues who work across our Yorkshire sites.
"We will be entering into a period of consultation with everyone affected by these proposals, announced today.”
Speaking about the proposals, Bas Padberg, managing director of Arla Foods UK, said the investment into Lockerbie showcased a commitment to supporting the future of British dairy.
He said: "There is an increasing focus on the role the UK food industry plays in helping to tackle the health crisis and provide good food to nourish a growing population.
"We are aware that this proposal has the potential to impact colleagues across some of our UK sites, and our priority is to support them through this challenging time.”
It follows the announcement of Arla’s 2024 annual results, whereby the co-op confirmed it made record investments of nearly £1 billion globally in 2024.
The investments included over £300m across Arla’s UK sites, including £179m in new technology at its Taw Valley creamery in Devon.
