Danone invests in organic facility

Danone also announced that it will support around 40 Hauts-de-France milk producers to convert to organic farming. Credit: ricochet64 via Shutterstock.

Danone has recently announced plans to invest considerably in a facility in France for organic baby milk, to reinvigorate the category and meet the increasing consumer demand for organic, natural products.

The company plans to spend the money towards its already existing site of its Blédina French infant nutrition brand, in Steenvoorde, Hauts-de-France. The investment is expected to help in expanding the existing buildings to house new production lines and creating 15 jobs in the process. Danone also announced that it will support around 40 Hauts-de-France milk producers to convert to organic farming.

Organic is often associated with ‘natural’. In fact, according to GlobalData’s 2019 Q3 consumer survey, for 55% of global consumers who have children aged 0-4 years, ‘natural’ means ‘organic’. The Covid-19 pandemic has determined many consumers to put more emphasis on the naturalness of their products. According to GlobalData’s Covid-19 Recovery Tracker Survey – Week 9, for 56% global consumers with children aged 0-4 years, natural/free-from synthetic ingredients are a top priority or are more important* than before as a result of the Covid-19 pandemic.

Danone has recently invested heavily into its organic line in the baby milk category, acknowledging the growing need for these products. For example, in late October 2019, in North America, it launched Horizon Organic Growing years, a whole milk targeted at children (aged one to five). Furthermore, in September 2020, it launched Aptamil Organic in the UK and Ireland. Aptamil Organic is a range of baby and toddler milk made with certified organic ingredients.

The new investment is a continuation of Danone’s commitment to its ‘One Planet, One Health’ vision, focusing on organic production or farming methods to benefit the environment. The long-term aim is to produce around 80 million litres of organic milk in Stenvoorde region to supply the plant. Danone’s recent investments in organic baby milk are an attempt to bring some innovation to and revitalise a declining category. According to Danone’s Q3 2020 Sales results, its specialised nutrition branch saw a 5.7% year-on-year decline in sales, and revenues in Europe declined at a mid-single-digit rate, ‘penalized by hospital and prescription activity rate below pre-Covid levels and soft category dynamics for infant formula’. Therefore, by promoting organic products in the sector, the company could attract health-conscious consumers, and target the dynamic and evolving parents’ needs, seeking to offer natural products to their children.

Danone is due to start the organic production at the end of summer 2021.

Week 9 refers to the following fieldwork dates: 7-11 October 2020

*significantly and slightly more important than before

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