The company said there will be new, more sustainable technology for the plant.
Work on the expansion starts in early 2020, with completion expected in the summer of 2021, and Arla will also create approximately 25 new jobs in the local market in connection with the increased capacity.
Arla will expand the milk weighing capacity, milk silo inventory, milk processing area, storage capacity and add a cheese production line to increase annual production to 53m kilos of mozzarella.
Arla's mozzarella production in Denmark takes place at its Branderup and Rødkærsbro facilities. From here, cheeses are shipped worldwide to 100 countries on all continents.
The cooperative said it expects the European mozzarella cheese market to increase from around 650,000 tonnes in 2019 to 720,000 tonnes by 2022.
The dairy will also reduce its use of water, and the expansion ensures that the dairy also can invest in green energy solutions in the future.
Rene Nørgaard, senior director of Arla's mozzarella production, said, “At Arla, we work with sustainability in all aspects of dairy production from the farm to the consumer. We also assume this responsibility at Branderup Dairy and therefore we aim to reuse as much water as possible, and will use the latest energy-optimized equipment for the expansion.”