One of the Nordic region’s largest food companies, Fazer, has signalled its intention to cease dairy production and focus on oat-based products.
Fazer, which has net sales of €1.1 billion, is a leading manufacturer of oat products in the Nordics.
Although it is a relatively small player in the Finnish dairy industry, it has now confirmed that it is considering discontinuing its dairy operations at its Koria factory near Kouvola, which employs 226 people.
It said the move would allow it to focus “on its core business and the execution of its plant-based strategy”.
Fazer said its dairy operations had been challenging because of “low volumes and high complexity in a category driven by scale”.
Last summer it doubled the production capacity of oat drinks at the Koria factory and if its plans to cease dairy operations go ahead, the factory will solely focus on the production of oat drinks and other oat-based products.
Kati Rajala, vice-president of Fazer’s non-dairy and dairy business added:
“Improving efficiency of our Koria operations is inevitable to secure our competitiveness. A possible discontinuation of the dairy production would enable us to focus on our plant-based core business, in which the Koria factory plays an important role in the future.”
The company, which exports its products to more than 40 countries and employs an estimated 6,000 people across Europe, said it is “actively developing plant-based food solutions of the future”.
Last year the European Union’s (EU) promotional policy encouraged people to try more plant-based diets. It also advocated that consumers should eat less red and processed meat and other foods linked to cancer risks.
Latest market data from the market research group Neilsen suggests the plant-based milk sector has recorded double-digit growth year-on-year.
This year the European Commission has allocated €185.9 million towards promotion activities “for sustainable and high quality EU agri-food products” in the EU and worldwide.
It also said that to “encourage healthier and balanced diets” more than €19 million will be specifically earmarked during 2023 for the promotion of fresh fruit and vegetables.