The Danish dairy industry consists of the international dairy group Arla Foods and 30 smaller dairy companies, together processing 4.7 billion kg of milk from a total of 61 production plants in Denmark.

Cooperatively owned by Danish and Swedish milk producers, Arla Foods is Europe’s largest dairy group. The Arla group processes more than 90 percent of the Danish and two-thirds of the Swedish milk pool. It also runs dairy operations in a number of other countries, with Arla UK plc as its biggest business.

The remaining 30 Danish dairies are evenly distributed between cooperatively and privately-owned companies. The small dairies typically specialize in various product areas within cheese, butter and liquid milk production. A large part of their production is exported by specialized exporters.

The value of all Danish dairy exports totals EUR 1.8 billion annually. The domestic market is, to a large extent, a market for domestic dairy production, although imported cheese and yoghurt now account for approx. 25 percent and 20 percent, respectively, of total domestic consumption. The market share of foreign milk remains moderate.

Like the processing sector, the Danish milk producers have seen tremendous structural change, with production now taking place on a small number of large farms. In 2010, approx. 4,100 dairy farmers each had an average of 127 cows and a milk quota of 1,142 tones. This places the Danish dairy farmers among the largest and most modern in Europe. More than half of the cows live in new loose-housing systems.

Exports of dairy products, in particular cheese, preserved milk products and butter, account for more than 20 percent of all Danish agricultural exports. The largest market for Danish dairy products is the other EU countries.