Arla is to spend £70m on a revamp of its dairy in Stourton, Leeds, to expand production of products including fresh cream and crème fraîche.

The plans include building a cottage cheese production line, Arla’s first move into UK production of the product. Stourton’s expansion was part of a wider plan to focus on value-added products, the company said. The site already processes milk for the multiples and the Cravendale brand. The facility is expected to be operational early next year.

Although 100 jobs will be created at the Stourton site, 130 staff will be lost at Arla’s Northallerton creamery, which will be closed in 2010 when production is transferred to Stourton.

“It is with much regret that we have announced the proposed closure of a site that has been strategically important to us,” said Lars Dalsgaard, Arla UK’s business group director for supply chain.