COPENHAGEN: Dairy cooperative Arla Foods, maker of Lurpak butter, said on Tuesday that big price hikes boosted sales in the first half of the year, but consumers will cut back on spending as prices are expected to rise further. I warned you.
Arla, which is owned by more than 9,400 farmers in Denmark, the UK, Sweden, Germany, Belgium, Luxembourg and the Netherlands, said sales from January to June were up 17% year-on-year to €6.38 billion ( $6.4 billion).
The rise was driven by “significant price increases” in Arla’s retail, foodservice and commodities businesses, despite lower sales volumes.
The Danish-based cooperative said higher prices would not lead to higher production as fertilizer prices would rise 145%, fuel 134% and cattle feed 36%, making farms more costly. .
“Global milk production is likely to decline further in the second half of 2022 and dairy prices will remain high and fall further as ongoing inflationary pressures and political instability negatively impact global growth. Arla expects it to be even more challenging because of the consumer trust and consumption,” the company said in a statement.