Arla Foods Consolidated Annual Report 2021
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Arla Foods Consolidated Annual Report 2021 / Our brands and commercial segments / Global Industry Sales
GLOBAL INDUSTRY SALES
The flexibility of our Global Industry Sales business model enabled us to quickly shift milk volumes
throughout the year as effects from the pandemic changed the demand between the retail and
foodservice sectors. During 2021, we have succeeded in increasing the proportion of higher-value
commodity products sold, and gained the highest possible value for our farmer owners from the
increasing prices.
Contents
What is the segment about?
In addition to our main sales channels, Arla conducts
business-to-business sales of cheese, milk powder and butter
to other companies for use in their production. Our Global
Industry Sales business model allows us to manage seasonal
and regional variability in owner milk production and balance
our milk throughout the year.
Focus in 2022
In 2022, our main focus will however be handling volatile
market conditions we have seen developing towards the end of
2021, with an unprecedented uptake in commodity prices and
swings in milk production. 2022 will also bring a significant
change to our business in Global Industry Sales with newly
established capacities, especially in our powder tower in
Pronsfeld and the expansion of our mozzarella facilities.
Revenue,
EURM
1,686
2020: 1,540
Share of milk solids
sold through global
industry sales
22.1%
2020: 22.7%
Share of total
Arla revenue
15%
2020: 14%
Key drivers of performance in 2021
European and global dairy commodity market prices increased
significantly throughout the year, with an unprecedented
acceleration towards the end of the year. The price increases
were driven globally by lower milk production due to higher
cost both on farm and in the dairies, combined with high
demand in the industrial sector. The overall share of milk
solids sold by our Global Industry Sales fell to 22.1 per cent
compared to 22.7 per cent last year due to a decline in milk
production in Northern Europe and an increase in the sales
through Arla's retail channels. Despite the decrease in volume
the revenue increased to EUR 1,686 million compared to
EUR 1,540 million as a result of the price increases.
Arla
Arla
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