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Danish Arla Foods to plough Tk 9.0b into Bangladesh

Dairy giant to expand its operations


Jubair Hasan | September 06, 2018 00:00:00


Mark Boot talking to the FE

Global dairy giant Arla Foods plans to further strengthen its footprint in Bangladesh reaching out to uncovered segment of the population while supporting them with affordable and better nutrition.

With the objective, the world's fourth-largest dairy producer through its brand, Dano, wants to invest Tk 9.0 billion in the coming years in Bangladesh, where a 51 per cent daily deficit in the consumption of milk was recorded by the World Health Organisation (WHO).

Vice president and head of Southeast Asia Arla Foods Ltd Mark Boot shared the company's future investment plan and prospects of dairy industry in the country in an exclusive interview with The Financial Express (FE) on Tuesday.

Managing director of Arla Bangladesh Peter Hallberg was also present there at the interview.

Terming Bangladesh a key market for the Scandinavian company, he said Arla has been operating its business in this country for the last 57 years and developed a great distribution network with a strong team of people.

At the same time, some macro-economic factors like GDP (gross domestic products) growth, population growth and the growing need for dairy products is turning Bangladesh into a "fertile ground" for business, he said.

"So, we have things in place from where we can start rolling our business," he said.

Replying to a question on how the company can help Bangladesh with the lowest milk supply (22 kg per capita per year) in the region, he said there is a need for getting more nutrition to ensure physical growth of the children given the rates of stunting and malnutrition.

Citing a study findings recently released by British researchers, he said milk can help stunted children grow and improve their health.

"So, it is proven that milk can help. This is the first part. Second thing is how we can make sure that it becomes affordable. This is a key," he said.

The company's Southeast Asia head went on, "Buying milk for the people who live on two dollars a day is something expensive and prohibitive."

Mr. Boot said that the company launched Dano Daily Pusti taking affordability of the consumers into their consideration back in 2016.

"We've a task on nutrition availability. We've a job as a company to innovate how we can put more nutrition per Taka. I think we're on the right track here," he said.

Asked steps to maintain the company's growth in Bangladesh, he said Dano has been adjudged as the best milk brand in Bangladesh in the last three consecutive years.

He said the company always focuses on innovation that helps maintain stronger position in any market. "We keep innovating considering the demand of the market."

According to Mr Boot, the lion's share of its future investment will be made for more production facilities while the remaining part to be used to innovate and find the right products and develop the local dairy sector.

Under the plan, the Viby-based dairy producer wants to develop the country's dairy farming by sourcing milk locally.

"We're trying to work with the government agencies concerned to see how we can develop the dairy sector. It does not make any sense just to start anywhere. We also need to make sure with the government where and how as a company can really help," he added.

He said the company gave utmost priority to safety and quality of its products. It is a cooperative owned by 11,200 farmers in several countries.

"We know what matters most is the quality of our milk. If we would have bad quality, we basically hurt our own business,' he said.

According to the statistics of the Department of Agriculture (DoA), the local dairy production can only meet 40 per cent of the demand.

Arla Foods is the 7th largest company of the world in terms of milk supply.

According to the Wikipedia, the company was formed as the result of a merger between the Swedish dairy cooperative Arla and the Danish dairy company MD Foods in 2000.

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