Valorisation of whey 177
Arla Foods Ingredients: AFI
In Denmark, the discovery of the potentials of whey protein began in 1974
when the first pilot production of whey proteins was established in the cellar
of a milk powder plant owned by the dairy cooperative in Holstebro (today,
Arla Hoco). Whey, which was hitherto regarded as waste, proved to be, as
Arla declares, ‘full of wonders’, and in 1980 Danmark Protein opened the
world’s largest factory for the production of whey protein concentrate and
lactose (milk sugar). In 1988, Danmark Protein established a subsidiary in
Japan, while MD Foods established MD Foods Ingredients in Germany in
1990 (Arla Foods Ingredients, 2018a). In 1994, MD Foods then acquired
Danmark Protein, which was merged with MD Foods Ingredients. A similar
development was seen in Sweden. With the merger of the mother companies
in 2000, MD Foods Ingredients became AFI.
Today AFI is an independent subsidiary of Arla Foods and is responsible
for all Arla Food’s whey protein products destined for the global B2B
market for functional and nutritional ingredients. The head office is located
next to Arla Foods in Viby, Denmark, and it has subsidiaries across the
globe (see below). The company has 1,370 employees. AFI has experienced
high growth rates over the last few years. In 2017, the revenue of AFI was
C655 million, and C766 million including its joint ventures (Arla, 2017).
This represents a revenue increase of 19.6% compared to 2016. AFI has also
seen a relative growth in both the scope and quality of its product portfolio;
the share of the volume of ‘value’ products compared to ‘standard’ products
grew from 68% to 74% between 2012 and 2017 (ibid.).
Maintaining or increasing market share in a fast- growing global market for
whey- based products requires large investments. AFI invested C220 million
in value- adding activities between 2012 and 2017 (Arla, 2017). A large share
has been directed towards expanding and refining its domestic production
capacity. This includes a C57 million investment in 2012 that nearly doubled
AFI’s whey processing capacity in Denmark, and a new lactose factory in
2013 worth C120 million. In 2016, a new production facility for whey
protein hydrolysate, used in infant, sports and clinical nutrition, went into
operation, tripling AFI’s existing capacity in this production category.
Today AFI processes 6–7 million tons of sweet whey every year on its
Danish facility in Nr. Vium. This includes 400,000 tons of casein whey,
derived from the production of calcium caseinate at Arla Hoco (interview
with AFI). To utilise the full capacity of the plant, AFI also imports sweet
whey from Sweden, the UK and Germany, and it buys sweet whey from
other Danish dairy companies. The products produced from sweet whey are
described in section 9.4.3.
AFI invests significant resources in research and development (R&D). Its
R&D division employs 70 scientists and technicians, accounting for 10% of
all AFI employees, and collaborates closely with universities. The R&D
covers ‘tailoring of molecular functionality, advanced separation technologies
Arla Foods Ingredients: AFI
In Denmark, the discovery of the potentials of whey protein began in 1974
when the first pilot production of whey proteins was established in the cellar
of a milk powder plant owned by the dairy cooperative in Holstebro (today,
Arla Hoco). Whey, which was hitherto regarded as waste, proved to be, as
Arla declares, ‘full of wonders’, and in 1980 Danmark Protein opened the
world’s largest factory for the production of whey protein concentrate and
lactose (milk sugar). In 1988, Danmark Protein established a subsidiary in
Japan, while MD Foods established MD Foods Ingredients in Germany in
1990 (Arla Foods Ingredients, 2018a). In 1994, MD Foods then acquired
Danmark Protein, which was merged with MD Foods Ingredients. A similar
development was seen in Sweden. With the merger of the mother companies
in 2000, MD Foods Ingredients became AFI.
Today AFI is an independent subsidiary of Arla Foods and is responsible
for all Arla Food’s whey protein products destined for the global B2B
market for functional and nutritional ingredients. The head office is located
next to Arla Foods in Viby, Denmark, and it has subsidiaries across the
globe (see below). The company has 1,370 employees. AFI has experienced
high growth rates over the last few years. In 2017, the revenue of AFI was
C655 million, and C766 million including its joint ventures (Arla, 2017).
This represents a revenue increase of 19.6% compared to 2016. AFI has also
seen a relative growth in both the scope and quality of its product portfolio;
the share of the volume of ‘value’ products compared to ‘standard’ products
grew from 68% to 74% between 2012 and 2017 (ibid.).
Maintaining or increasing market share in a fast- growing global market for
whey- based products requires large investments. AFI invested C220 million
in value- adding activities between 2012 and 2017 (Arla, 2017). A large share
has been directed towards expanding and refining its domestic production
capacity. This includes a C57 million investment in 2012 that nearly doubled
AFI’s whey processing capacity in Denmark, and a new lactose factory in
2013 worth C120 million. In 2016, a new production facility for whey
protein hydrolysate, used in infant, sports and clinical nutrition, went into
operation, tripling AFI’s existing capacity in this production category.
Today AFI processes 6–7 million tons of sweet whey every year on its
Danish facility in Nr. Vium. This includes 400,000 tons of casein whey,
derived from the production of calcium caseinate at Arla Hoco (interview
with AFI). To utilise the full capacity of the plant, AFI also imports sweet
whey from Sweden, the UK and Germany, and it buys sweet whey from
other Danish dairy companies. The products produced from sweet whey are
described in section 9.4.3.
AFI invests significant resources in research and development (R&D). Its
R&D division employs 70 scientists and technicians, accounting for 10% of
all AFI employees, and collaborates closely with universities. The R&D
covers ‘tailoring of molecular functionality, advanced separation technologies