Valio plans to merge two dairy cooperatives in Finland

Finnish dairy company Valio is planning to merge its milk procurement cooperatives, Osuuskunta ItäMaito and Osuuskunta Maitosuomi, to form a new company called Osuuskunta Maitosuomi, which will become operational from next September.

The new cooperative will be based in Lapinlahti and is expected to further enhance services for dairy farmer entrepreneurs, as well as ensure greater resource efficiency.

Osuuskunta Maitosuomi Board chairman Esa Kotala said: “The number of dairy farmer entrepreneurs in Finland has been falling by 5–7% each year for some considerable time now, which also cuts the number of members in the milk producer cooperatives.

“The merger will enable us to enhance our operations and secure the future of services offered by the cooperative. Advisory and expert services will be more effective together and serve the entrepreneurs more efficiently.”

The final decision regarding the merger will be made at the cooperative’s delegates meetings to be held later this year.

The new cooperative will serve as the largest single shareholder of Valio, holding 20,849 shares.

This dairy cooperative will lead to an intake of raw milk of around 900 million litres per year.

Osuuskunta Maitosuomi has more than 1,100 dairy farmer entrepreneur members, while Osuuskunta ItäMaito has nearly 1,600 members.

Last year, Osuuskunta Maitosuomi’s intake of raw milk volume was nearly 364 million litres while ItäMaito’s was around 519 million litres.

The two cooperatives are expected to supply nearly half of the raw milk volume required by Valio.

ItäMaito board chairman Mikko Heikkinen said: “The new cooperative’s Lapinlahti domicile puts it close to the heart of the combined operating area, which extends from Ostrobothnia to North Karelia, and from Kainuu to Central Finland.

“Lapinlahti’s current cheese and powder plants’ modern premises are ideal for the new cooperative’s personnel. Most of the staff will be serving the entire territory.

“The new cooperative is being christened Maitosuomi (‘Milk Finland’), which aptly describes its new operating area stretching across a large part of the best milk production regions in Finland.”

The offices of Osuuskunta ItäMaito are based in Lapinlahti while that of Osuuskunta Maitosuomi are in Seinäjoki.

Out of the 23 dairy farmer members on the supervisory board of Valio, four are from Osuuskunta Maitosuomi and six from ItäMaito.