Arla Foods Ingredients and Milcobel supply deal targets infant nutrition and specialty protein

16 Dec 2022 --- Danish-based Arla Foods Ingredients has formed a new supply arrangement with dairy producer Milcobel. The partnership will involve Milcobel providing whey protein retentate sourced from mozzarella production, which Arla will refine and then use to produce ingredients for high-end protein markets. 

Such ingredients include milk fat globule membranes for infant formulas and whey protein hydrolysates for medical nutrition products. 

Henrik Andersen, CEO of Arla Foods Ingredients, spoke to FoodIngredientsFirst, emphasizing the growing desire in F&B for specialty proteins and the expanding market for high-end proteins.

“Broadly, there are four main segments for specialty proteins. The largest is sports and performance nutrition at around 60% of market volume, followed by infant formula and early life nutrition at around 15% and medical nutrition at 10% . There are also applications in food - mainly dairy but also egg substitution in bakery, around 15%,” he explains. “Across the high-end protein space, we expect to see a growth of around 5% to 6%  over the next five years.”

“Whey proteins are well known for their excellent nutritional quality, rapid absorption and superior content of essential amino acids and branched-chain amino acids,” he adds. “That makes them a go-to protein source for sports nutrition, but also infant formula and medical nutrition.”

“The starting point for this agreement was this growing demand for high-quality specialty protein ingredients. We chose to work with Milcobel because of the very high standards to which it operates and the security of supply it offers,” he explains. 

Arla Foods Ingredients has plans to grow by 6% to 8% a year over the next five years, underscoring how this agreement will help support that growth.

Andersen also points out the deal will also provide new opportunities for the company’s customers, particularly in the medical and early-life nutrition sectors.

Arla's deal with Milcobel focusses on converting whey into specialty protein.

Boosting immunity
Infant nutrition is a strong trend post-pandemic, with many consumers wanting to boost their child’s immunity through nutrition.

Apart from the COVID-19 pandemic, the US infant formula crisis showed the dangers of a monopoly in such a market. One of the four largest formula-producing corporations, Abbott Nutrition, had to recall its products due to a bacteria found in the manufacturing plant, which drove the shortage further as import restrictions during the pandemic caused a bottleneck that precipitated the shortage. 

With Nestlé recently selling its formula plant and US regulators addressing the monopoly, the infant nutrition space is beginning to open up.

With probiotics and gut health at the forefront of infant nutrition, scientific research recently found in favor of the World Health Organization’s nutritional recommendation to breastfeed for the first six months of life.

Milking the problem
NutritionInsight recently spoke with Eurosérum, Vaneeghen, Kerry, FrieslandCampina and Symrise about the latest market trends and ingredient developments within the sector, who pointed out the trend toward increased nutrition within infant formula.

In the broader dairy sector, the future of milk seems uncertain as the industry reports that milk is no longer abundant. Arla Foods Ingredients has increased its prices for milk eight months in a row as a result of the inflation, with this December marking the first month since March without price increases.

However, Arla Food Ingredients has struck recent deals similar to today’s union with Milcobel, expanding its whey protein ingredient portfolio and moving further into the wellness and ready-to-drink beverage space. 

By James Davies

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