Arla unveils £144m+ investment and new centre of excellence to mark anniversary

Arla Foods is cementing its long-term commitment to UK dairy manufacturing with a colossal multi-year investment programme of over £144 million at its Lockerbie site, as it celebrates 50 years of cheese-making at the Scottish facility.

The major capital injection, announced on October 10th, underscores Arla’s ambition to boost capacity, innovation, and sustainability across its UK operations.

Key elements include significant upgrades to its cheddar facilities, the establishment of a dedicated Centre of Excellence for UHT and lacto free milk production, and the near-completion of a second anaerobic digestion (AD) plant.

Arla Lockerbie, one of the UK’s largest cheese-making sites since its 1975 opening, has already seen a £34 million enhancement of its cheddar production technology. This upgrade was recently inaugurated by Mairi Gougeon MSP, Scottish Cabinet Secretary for Rural Affairs, Land Reform and Islands, and marks a renewed focus on the site’s award-winning cheddar heritage.

The next phase of investment focuses on specialty dairy, with the confirmation of a £90 million Centre of Excellence for UHT and LactoFREE milk. This new hub will create 90 new roles and firmly establish Lockerbie as a key UK site for long-life and speciality milk production.

“This is a landmark moment for Lockerbie. As we celebrate 50 years of production, we’re also unlocking the site’s next era with significant investment to power future growth,” said Fran Ball, SVP of UK supply chain at Arla Foods. “We’re thrilled to confirm the start of construction for the new Centre of Excellence… bringing fresh opportunities to the local community.”

Today, the Lockerbie site processes over 600 million litres of milk annually, resulting in around 200 million litres of fresh bottled milk and 42,000 tonnes of cheese.

The investment has been strongly welcomed by the Scottish Government. “The scale of investment here represents a real boost to the local economy, strengthens vital partnerships with Scottish farmers and suppliers, and sends a clear signal of confidence in the future of Scotland’s dairy sector,” commented Cabinet Secretary Mairi Gougeon MSP.

Furthermore, Arla is doubling down on its sustainability efforts with a £20 million anaerobic digestion plant nearing completion. This second AD facility will help turn whey permeate — a by-product of the site’s massive cheese operation — into bio-methane for the national gas grid. At full capacity, the existing and new plants can generate enough gas to heat thousands of average UK homes, effectively supplying the entire town of Lockerbie.

Bas Padberg, managing director of Arla Foods UK, summarised the strategic vision: “By investing in Lockerbie, we’re strengthening the backbone of British dairy—boosting capacity, innovation and skilled jobs… we’re committed to delivering nutritious, affordable dairy for more people.”

Arla farmer and Arla Foods UK board director, Arthur Fearnall, added that the programme is designed to “secure the best possible milk price for all Arla farmer owners” by building a stronger site.

Lockerbie investment snapshot:

• Total commitment: over £144 million
• Cheddar upgrade: £34 million completed this year.
• UHT/Lacto Free Centre: £90 million for new Centre of Excellence, creating 90 new jobs.
• Sustainability: £20 million on second anaerobic digestion plant.