FDBusiness.com

The newly created DMK, Germany’s largest dairy co-operative, has unveiled plans for major restructuring in order to improve cost efficiency. DMK was formed in May 2011 following the merger of two German dairy co-operatives – Humana Milchindustrie and Nordmilch.

“When the merger took place it was foreseeable that there would have to be changes to the production site structure of 20 factories with more than 50 production departments, some very similar,” says managing director of operations Sonke Voss. “It is a matter of urgent necessity to bundle our production competences and adapt the site structure to future developments in milk volume in order to secure cost leadership. This is the only way we can maintain our position in the fiercely contested global market and guarantee shareholders a competitive milk price over the long term.”

Changes are envisaged at a total of ten of the current 20 DMK production sites. In addition to internal relocation of a number of dairy products production departments (including UHT milk, curd and drinks) to other factories, there are plans to amalgamate powder and butter production departments. DMK’s Struckhausen factory and the wholly owned subsidiary Milchhof Magdeburg are earmarked for closure against the background of better utilisation of the milk at adjacent sites and, in the case of Magdeburg, insufficient milk volumes in the region. Struckhausen currently has 56 employees and Magdeburg 59. Including the relocation measures within individual sites, this means that a probable total of 156 jobs would be affected by possible restructuring measures. DMK has a total workforce of 5,657 people.