Arla targets UK dominance in organic spreads

By Neil Merrett

- Last updated on GMT

Related tags: Butter

Arla Foods is launching an organic alternative for its leading
spread brand in a bid to become market leader of the burgeoning
segment.

As of this month, the company will now produce and distribute Lurpak Organic Spreadable across the country, before a possible roll out of the product further across Europe. The company says that extending the Lurpak range, which is currently the nation's best selling butter, spreads and margarine brand, reflects the high level of potential growth for organic dairy goods in general. The spread is made from blending organic milk with organic vegetable oils to the traditional Lurpak recipe, the company says. Organic butters, margarine and spreads currently account for just 1.4 per cent of total UK spending in the segment, with a large proportion of these sales attributed currently to private label brands, according to Arla. Lurpak brand manager Jessica Hardcastle believes that there is a gap in the current market for butters, spreads and margarines, which the brand can fill. "[Spread's] share of the total organic market is considerably lower than that of organic milk and we believe that this offers an opportunity for a product, such as Lurpak Organic Spreadable, to take ownership of the category,"​ she stated. "Our research tells us that consumers want an organic [butters, spread and margarine] product from a brand they can trust."​ According to figures supplied by organic body, the Soil Association, UK sales of clean label food and drink products are increasing by £7m a week. The same findings add that volume sales of organic butters, spreads and margarines alone are up 16 per cent in year-on-year terms to £13m. To tap into this demand, Arla claims that it has already made significant steps into European organic dairy production, with the extension of Lurpak reflecting the growing importance of the market to the company. A company spokesperson said that the launch of the organic Lurpak range had not required significant investment in its operations with it operations already sufficiently supplied by a pool of Danish organic farmers to meet the demand. The spokesperson added that in the UK alone, Arla Foods already processes organic milk for UK retailers including restaurant chain McDonald's. The group also supplies organic butter to retailers in the country. The company last expanded the Lurpak range in 2006, with the launch of a separate unsalted version of the spread, and said it would look to consider further variations for the brand in the future to meet specific nutritional demands. Similarly as part of this focus on expansion, the group said that it was planning to release the product in other markets in the future, though did not specify any exact country or timeline for the expansion.

Related topics: Markets, Arla Foods, Butters & Spreads

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