Anchor butter is to be produced in the UK for the first time, as brand owner Arla migrates production from New Zealand.

The Grocer predicted UK production of Anchor might be on the cards back in February 2011.

Initially, only Anchor block butter will be produced in the UK. Production will take place at the Westbury site in which Arla owns a stake alongside First Milk and Milk Link (soon to merge with Arla).

However, Arla plans to eventually migrate production of the full Anchor portfolio, including spreadable products.

Currently, Anchor butter is shipped over from New Zealand, where it is produced by dairy giant Fonterra.

Bringing production to the UK was part of Arla’s long-term growth strategy – facilitated by Arla’s investment in Westbury, according to supply chain director Lars Dalsgaard.

“It is a further example of Arla’s commitment to the UK as we have created a home for more British cream and are adding value to it,” he said.

UK-produced 250g packs of Anchor block butter will go into stores from next week. Arla has been supplying retail own label block butter through Westbury since last August.