Dairy company Arla Foods has signed a new memorandum of understanding (MoU) with Kaduna State and the Nigerian government to advance the dairy sector in the region.

Under the MoU, the state and the government will offer permanent farmlands with water access to 1,000 nomadic dairy farmers.

Arla Foods International executive vice-president and head Tim Ørting Jørgensen said: “With demand for nutritional dairy products increasing amongst Nigeria’s fast-growing population, there is a clear opportunity and need to support the development of the local dairy industry to help meet this demand.

“As a company with a history of successful collaboration on local dairy development projects and a long-term commitment to our Nigerian consumers, customers and partners, we are delighted about this new partnership, because it will make a real difference in many farmers’ businesses and lives.”

The company will act as the commercial partner for purchasing, collecting and bringing the local milk to market.

The Central Bank of Nigeria will provide funding for the project, with a guarantee from the local state, while Arla will invest in milk collection centres.

Arla added that the country’s existing dairy sector meets less than 10% of the current demand, with a prediction that this demand will grow significantly in the future.

Most of the dairy farmers in the country are small scale farmers.

Arla intends to offer a solution using experience from its pan-European supply chain and its cooperative farmer culture to deliver commercial success with the farmers in Nigeria.

Jørgensen added: “Bringing local milk into our product portfolio is part of the way we believe that our business will be long-term successful in Nigeria.”