Arla Foods invests US$175.68M to expand its Lockerbie creamery

UK – Arla Foods, a dairy manufacturer, has announced a £144 million multi-year investment to expand its Lockerbie creamery, as the dairy cooperative marks 50 years of cheese-making at the site.

The milestone expansion includes a £34m upgrade to its cheddar facilities, the creation of a new Centre of Excellence for UHT and lactose-free milk, and the near completion of a second anaerobic digestion plant to generate renewable energy.

The Scottish base will now see a further £90 million put towards the expansion of the site with a new Centre of Excellence.

This hub will be for the production of UHT and lacto free milk in the UK specifically. A further £20 million has also been invested into an anaerobic digestion (AD) plant, which is now nearing completion.

This will help to turn waste from whey permeate – a by-product from cheese making – Into renewable energy by supplying bio-methane into the gas grid.

The existing AD plant can process up to 36,500 tonnes of whey permeate per year. At full capacity, it can generate around 30,500 MWh of gas annually – enough to heat more than 2,600 average UK homes.

“This is a landmark moment for Lockerbie. As we celebrate 50 years of production, we’re also unlocking the site’s next era with significant investment to power future growth,” commented Fran Ball, SVP of UK Supply Chain at Arla Foods.

“This month we’ve already delivered major technology upgrades as part of our £34 million enhancement of cheddar production, and we’re thrilled to confirm the start of construction for the new Centre of Excellence for UHT and LactoFREE milk at Lockerbie – bringing 90 new roles and fresh opportunities to the local community.”

The investment into Lockerbie comes as the dairy plant celebrates its 50th year, with Mairi Gougeon MSP, Scottish cabinet secretary for rural affairs, land reform and islands, officially opening the new cheddar facilities building.

Gougeon said: “This is not just a proud moment for Arla, but for the Lockerbie community and the wider South of Scotland region. Our food and drink industry is uniquely placed to grow the economy, with the Scottish dairy sector valued at more than £560 million in 2024, and this project shows this can be done, whilst also reducing emissions.”

Since opening in 1975, Lockerbie has grown into one of the UK’s largest cheese-making plants, processing more than 600 million litres of milk each year and producing around 42,000 tonnes of cheese — enough for hundreds of millions of sandwiches.

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