Arla expands climate action programme to accelerate progress on farms

Düsseldorf/Bremen, 12. Oktober 2026 – More ways to achieve points and a higher reward for taking action. From 2027, Arla will expand its pioneering FarmAhead™ Incentive with six new action areas, over 30% more available points and a one-third increase in the value of each point.

Arla Foods is launching the biggest update to its FarmAhead™ Incentive since the model began rewarding farmers in 2023. By giving farmer owners more ways to earn points and increasing the financial value of each point, the cooperative aims to accelerate actions that reduce the climate impact of milk production on farm. The update builds on years of proven results where Arla farmer owners have reduced their absolute emissions from raw milk production by 1.2m tons CO2e since 2020.

The principle behind FarmAhead™ Incentive is simple. Farmers earn points for documented actions to reduce CO2e emissions on their farms, and those points directly influence the price they receive for their milk. It puts a financial incentive worth up to EUR 550m annually behind actions scientifically linked to reducing emissions, making climate action part of the everyday business of dairy farming.

In 2027, the FarmAhead™ Incentive will increase from 84 to 111 available points and increase the value of each point from EUR-cent 0.03 to EUR-cent 0.04 per kilo of milk. Six new action areas and changes to existing ones will give farmers across different farm types and geographies more opportunities to take action to reduce the climate impact related to milk production and be rewarded for doing so.

“With FarmAhead™ Incentive, we link actions to reduce the climate impact of milk production on farm directly with the milk price paid to our farmers. That is a powerful way for a farmer-owned cooperative to drive change. Now we are taking our biggest step forward since launch, providing more ways for farmers to act and ensuring a higher reward for every point they earn. Our ambition is clear: to turn new technology and knowledge into practical action on farms and accelerate emissions reductions,” says Hanne Søndergaard, Executive Vice President, Agriculture, Sustainability and Communication at Arla Foods.

More opportunities to take the next step

Since the launch of the model in 2023, Arla’s farmer owners have increased their average incentive score by six points. Arla’s data shows a strong link between higher point scores and lower on-farm emissions. The update draws on the latest farm data and scientific knowledge to reward actions with the greatest climate impact and bring new technologies into the model as they mature.

The six new action areas cover forage, manure treatment, biofuels, low-carbon fertiliser, reduced methane from grazing cows and breeding. Arla will also adjust points and thresholds for existing actions, including feed efficiency, fertiliser use, protein efficiency and grazing.

The update was approved by Arla’s Board of Directors.

“Our farmer owners have already taken important steps to reduce emissions. We want to make sure there is a next step for them to take, including those already earning maximum points in parts of the model. Farms differ, and so do the opportunities to take action to reduce emissions. With this update, we are giving more farmers more options to move forward in ways that fit their farms,” says Jan Toft Nørgaard, Chair of Arla Foods.

Continued customer demand for on-farm actions

The FarmAhead™ Incentive is also closely linked to Arla’s customer collaborations. Through FarmAhead™ Customer Partnerships, customers work with Arla to support farmer-led climate action and access primary, claimable carbon footprint data. As customers increasingly look for year-on-year reductions in their own value chains, the strengthened incentive model helps ensure that Arla can continue to deliver credible, measurable progress from farm level.

“Our customers want measurable reductions in the footprint of the dairy they buy, and they want to work with us to achieve them. By giving farmers more opportunities to take action, we are strengthening the link between what happens on the farm and what our customers can achieve in their value chains,” says Hanne Søndergaard.

Arla will introduce the changes in stages, with the first payments under the updated model taking effect from 1 January 2027.

Facts: FarmAhead™ Incentive update

The total number of available points will increase from 84 to 111 during 2027.
Six new levers will be introduced: forage, manure treatment, biofuels, low-carbon fertiliser, reduced methane from grazing cows and breeding.
Current levers will be adjusted, including feed efficiency, fertiliser use, protein efficiency and grazing.
The value of each point will increase from EUR-cent 0.03 to EUR-cent 0.04 per kilogramme of milk.
The model remains within the existing framework of up to EUR-cent 3.0 per kilogramme of milk redistributed through the FarmAhead™ Incentive.
The update reflects the latest FarmAhead™ Check methodology, updated data and science, and the development of new on-farm technologies.