FrieslandCampina: The Dairy Cooperative Behind Europe’s Second-Largest Agricultural Exporter

FrieslandCampina is the clearest example of how a farmer-owned cooperative can run a €13 billion multinational, and of what that ownership model costs when milk prices fall. The company processes about 9.3 billion kilograms of member milk a year, sells Friso infant formula in China, Dutch Lady in Malaysia and Frisian Flag in Indonesia, and still answers to a members’ council of dairy farmers who vote by milk volume. This article explains how the cooperative works, why it merged with Milcobel in 2026, how the member milk price is set, and what the 2025 and 2026 results say about the limits of the model in a country that is simultaneously trying to shrink its livestock herd. It is part of the Netherlands Company Stories hub.

How does the FrieslandCampina cooperative actually work?

The structure is two-tier: a cooperative of dairy farmers owns 100 per cent of a company that behaves like a conventional multinational. Zuivelcoöperatie FrieslandCampina U.A. is the sole shareholder of Royal FrieslandCampina N.V., which has its own executive board, supervisory board, bonds and credit lines. Members deliver all their milk to the company and in return are paid a guaranteed price, a sustainability premium and, in good years, a share of profit.

Governance runs through districts. Before the Milcobel merger there were 14 districts across the Netherlands, Germany and Belgium; each elects a district council of eight to ten farmers, and those councils together form the members’ council, the body that approves mergers, the annual accounts and the milk-price system. Voting weight is proportional to the volume of milk a district delivers, which means that a large Frisian or Brabant district has more say than a small German one. The cooperative’s board, chaired by Sybren Attema through the Milcobel vote and, from June 2026, by Nils den Besten, doubles as the supervisory board of the company. The chief executive since June 2023 is Jan Derck van Karnebeek, who spent roughly three decades at Heineken before taking the job, with Hans Janssen as chief financial officer.

The company itself is big by any standard. It reported more than 19,000 employees, offices in 32 countries and products sold in more than 100. Its roots date back to a Frisian cooperative founded in 1871; the modern group was created on 30 December 2008, when Friesland Foods and Campina merged after the European Commission approved the deal on 17 December that year on condition that several Dutch consumer-dairy activities were divested. That merger created the processor that handles the majority of Dutch milk and gave the country, as described in the article on the Netherlands as the world’s second-largest agricultural exporter, its single most valuable food-export category: dairy and eggs were worth €13.3 billion of exports in 2025.

What do the 2025 results show?

They show a company that has recovered from a near-miss and is now funding a milk price above market levels from cost savings. Revenue in 2025 was €13.4 billion, up from €12.9 billion in 2024, with operating profit of €507 million against €527 million a year earlier and a net result of €328 million compared with €321 million. The slight dip in operating profit was attributed mainly to higher IT costs, largely offset by savings. Operating cash flow fell to €615 million from €900 million as working capital normalised.

The context matters. In 2023 FrieslandCampina posted an operating profit of only €75 million and a net loss of €149 million, and in October that year it announced a restructuring designed to take €400 million to €500 million out of its cost base by 2026. By the end of 2025 the company said it had delivered more than €500 million in inflation-adjusted savings compared with 2023; full-time staff numbers had already fallen by almost 1,400 in 2024 alone. Van Karnebeek described 2025 as a year of two halves: a good first half, in which net profit rose more than 20 per cent to €230 million, followed by a second half in which commodity dairy prices dropped at a pace he called unprecedented.

By business group, Specialised Nutrition and Ingredients grew, largely through better margins; Europe and Retail & Americas were stable, with volume growth and market-share gains but thinner margins because of higher raw-milk costs; Professional was squeezed by low commodity prices and an unfavourable mix; and Asia and the Middle East, Pakistan and Africa unit saw pressure on volumes. In 2024, by contrast, Specialised Nutrition had reported what the company called excellent profit, driven by Friso infant nutrition in China, a market where the brand had gained position partly because competitors had withdrawn.

How is the member milk price set, and what did farmers receive?

The milk price has three main components, and the arithmetic drives everything else in the cooperative. The guaranteed price is set each month in advance, benchmarked against what a basket of other European dairy companies pay; in 2025 it averaged €53.77 per 100 kilograms, up 8.7 per cent from €49.48. On top of that, members earned a Foqus planet sustainability premium of €1.30, and at year end the cooperative paid a supplementary cash payment of €1.31 per 100 kilograms, worth €121 million in total. The combined 2025 milk price was €56.93, compared with €52.95 in 2024 and €48.08 in 2023. Members also received €51 million in interest on member bonds, and total compensation to members reached €5.32 billion, up 11.6 per cent.

The guaranteed price is the number farmers actually plan around, and it is volatile. It was €55.63 in the first half of 2025 and €40.49 in the first half of 2026, a drop of more than a quarter in twelve months. The pro-forma milk price including premiums fell from €59.66 to €43.09 over the same period. For October 2026 the company announced a guaranteed price of €45.50 per 100 kilograms, the latest in a series of monthly increases after a trough earlier in the year, with the organic guaranteed price set at €65.25.

Volumes have been moving in the opposite direction to price. Member milk supply fell 3.4 per cent in 2024 to 9.05 billion kilograms as farms closed, then rose 2.4 per cent in 2025 to 9.27 billion kilograms as a recruitment campaign secured 411 million kilograms of new milk commitments. In the first half of 2026 supply jumped 18.5 per cent to 5.44 billion kilograms, more than half of that from Milcobel’s former members and the rest from new recruits and growth on existing farms. The company called it a break with the trend of the previous years. Membership tells the same story in slower motion: member farms fell from 9,417 at the end of 2023 to 9,001 at the end of 2024 and 8,781 at the end of 2025, with 182 farms joining and 203 stopping production that year, before the Milcobel merger added roughly 1,250.

Why did FrieslandCampina merge with Milcobel?

Because both cooperatives needed scale and milk, and Milcobel needed a bigger balance sheet more than it needed independence. Milcobel, created in 2005 from the merger of Belgomilk and BZU Melkaanvoer, was the largest Flemish dairy processor, handling about one billion kilograms of milk a year at six sites and known for its mozzarella and Brugge cheese. At its peak it had around 3,000 member suppliers; by the time of the merger vote it had fewer than 1,500. In 2025 it sold its Ysco ice-cream subsidiary and used the proceeds to repay most of its loans, which left it with a stronger balance sheet but a shrinking milk pool.

The intended merger was announced in December 2024. The European Commission cleared it on 23 October 2025, and on 16 December 2025 both sides voted: more than 95 per cent of FrieslandCampina’s members’ council was in favour and Milcobel’s extraordinary general meeting of about 70 delegates approved it unanimously. The merger took effect on 1 January 2026. Milcobel’s nine member circles were folded into two new FrieslandCampina districts, Milcobel-West and Milcobel-Oost, bringing the total to 16, and its farmers became full members with the same rights, obligations and milk-price system as everyone else. Former Milcobel chair Betty Eeckhaut joined the cooperative board and supervisory board; former Milcobel chief executive Peter Grugeon joined the executive team as president of the Professional business group from 1 April 2026 and was elected chair of the Belgian dairy federation BCZ in June.

Rabobank’s dairy analysts, whose role in financing the sector is covered in the article on Rabobank as a cooperative food and agri bank, expected the deal to produce synergies that would eventually flow into the milk price and to redistribute milk across the combined network of around 31 plants. Milcobel’s six sites processed roughly 160 million kilograms each, less than half the average of FrieslandCampina’s 25, so some consolidation was always implied. By July 2026 Van Karnebeek said the Belgian factories were running at full capacity and that the mozzarella business and customer base were performing better than expected. The merger also added about 950 employees in Belgium and France and, on 2 January 2026, the company completed a second deal, buying Wisconsin Whey Protein in the United States to strengthen its position in high-value proteins.

What happened in the first half of 2026?

Profit roughly halved while volume surged, which is exactly what a cooperative looks like when the market turns. Operating profit for the six months to June 2026 was €269 million, down about 26 per cent from €363 million in the first half of 2025, and net profit fell to €138 million from €230 million. Revenue was broadly stable. The cause was lower basic dairy prices: the commodity portfolio, which includes butter, milk powder and bulk cheese, was squeezed by abundant milk supply across Europe, and higher-value products only partly compensated. Protein products, by contrast, benefited from a continuing positive trend.

The company had warned of this in February, when it said first-half profitability would lag the prior year significantly and that improvement was expected in the second half once supply and demand rebalanced. By July Van Karnebeek was pointing to strong demand and rising sales in higher-margin segments, calmer commodity markets and stabilised milk supply, while flagging tension in the Middle East as a concern. He said he expected a decent second half with a better result than the second half of 2025. Despite the weaker numbers, the cooperative set aside €0.69 per 100 kilograms toward a possible year-end supplementary payment, a smaller reservation than the €2.24 made at the same point in 2025.

How important is China and infant formula to the group?

Infant formula is the highest-margin business FrieslandCampina has, and China is its most important single market for it. The Friso brand, sold through the Specialised Nutrition business group, was the main reason that unit reported an excellent operating profit in 2024, and the company has said the brand improved its position in Chinese infant nutrition partly through its own strategy and partly because several competitors retreated from a market where birth rates have been falling for years. In 2025 the renamed Specialised Nutrition and Ingredients group grew again, this time mainly through better margins rather than volume.

The dependence cuts both ways. Chinese infant-formula demand is shrinking structurally with the birth rate, regulatory registration rules favour domestic brands, and currency moves between the euro and the renminbi swing reported results. Asia as a whole saw volume pressure in 2025, and the company listed currency fluctuations and possible higher trade tariffs among the main risks for 2026. The group’s answer has been to broaden the protein story beyond babies: its Ingredients business sells whey and casein proteins into sports, lifestyle and medical nutrition, the Wisconsin Whey Protein acquisition added US capacity, and in May 2026 it announced more than €90 million of investment in whey-protein capacity at its Bedum, Veghel and Workum plants in the Netherlands, which it said would also cut emissions by about 16 kilotonnes of CO2-equivalent. Veghel marked a century of production in October 2026, having grown from a local cooperative dairy into an international nutritional-ingredients site.

Southeast Asia remains the other pillar. Dutch Lady in Malaysia, Frisian Flag in Indonesia, Alaska Milk in the Philippines and FrieslandCampina Engro in Pakistan are all consumer businesses with local listings or partners; in September 2026 Frisian Flag Indonesia formed a strategic partnership with Ultrajaya, the country’s leading UHT milk producer, to extend distribution.

How does Dutch nitrogen policy affect the cooperative?

Nitrogen policy caps the cooperative’s domestic raw material. Since the Council of State struck down the national nitrogen permitting scheme in May 2019, Dutch dairy farmers have faced a succession of buyout schemes, manure-disposal limits and uncertainty about expansion permits, all described in the article on the Dutch nitrogen crisis and farmer buyouts. The effect shows up in FrieslandCampina’s own numbers: member farms fell by more than 600 in two years, milk supply dropped 3.4 per cent in 2024, and the company’s 2025 report attributed part of the outflow to farms stopping production, often because no successor wanted to take on a business with an uncertain licence to operate. Dutch pasture grazing, which the company rewards through its Foqus planet premium, slipped to 78.3 per cent of farms in 2025 according to sector data.

The company’s response has been to recruit milk from wherever it can get it. The 2025 recruitment campaign, the Milcobel merger and the earlier integration of German and Belgian members all reduce the share of the milk pool exposed to Dutch policy. The Foqus planet programme, which paid €1.30 per 100 kilograms in 2025, ties the premium to measurable outcomes such as grazing, feed and emissions, which the company reported as a 19.1 per cent cut in FLAG (forest, land and agriculture) emissions against a 2020 baseline. In September 2026 it switched milk-collection trucks to biomethane with its transport partners to reduce supply-chain emissions. Externally, Koert Verkerk, a FrieslandCampina executive, was elected president of the European Dairy Association in October 2026, giving the group a direct seat in the Brussels debate over livestock emissions.

Who are FrieslandCampina’s competitors, and where does it stand?

In Europe the relevant comparison is with other cooperatives, and the sector is consolidating around them. Arla Foods, the Danish-Swedish cooperative, agreed in 2025 to merge with Germany’s DMK Group, and the European Commission approved that deal in May 2026, creating a rival that will process considerably more milk than the enlarged FrieslandCampina. Royal A-ware, the private Dutch cheese and dairy group run by Jan Anker, has grown steadily by offering farmers an alternative to the cooperative and by building new plants in Belgium; Dutch trade press has described it as the thorn in FrieslandCampina’s side. In Belgium the remaining independent, Laiterie des Ardennes, chose in early 2026 to stay independent and adjust production to lift its own milk price.

The structural consequence for Dutch farmers is that switching costs between processors have fallen: a farmer can leave FrieslandCampina for A-ware, DOC Kaas or Cono, and the cooperative’s own recruitment campaign is evidence that it now competes for milk rather than simply receiving it. In the Netherlands, where the supermarket chains such as Jumbo and Albert Heijn control most grocery shelf space, the company’s consumer brands, including Campina, Chocomel, Optimel and Mona, give it pricing power at retail; in October 2026 it won trademark protection for Chocomel’s distinctive yellow packaging in a Dutch court, a small but telling defence of brand equity.

What can founders and investors learn from FrieslandCampina?

The first lesson is that ownership defines strategy more than management does. FrieslandCampina cannot pivot away from milk, cannot reject supply and cannot pay its owners less than its peers without losing them; every strategic choice, from Friso in China to Milcobel in Flanders, is a way to make 10 billion kilograms of milk worth more. A founder choosing a cooperative, a mutual or a tightly held family structure should expect the same: the structure is a commitment device, and it will constrain options exactly when the market is at its worst.

The second lesson is about turnarounds. The 2023 loss triggered a €500 million cost programme that was delivered in two years and showed up as a milk price above the benchmark in 2025. The sequence, loss first, savings second, owner reward third, is familiar from listed companies, but here the reward went to suppliers rather than shareholders, which kept the milk pool intact long enough to recruit new members and absorb Milcobel. Investors in supplier-dependent businesses should track supplier retention as a leading indicator in the same way they track churn in software.

The third lesson is that consolidation in a shrinking home market means buying volume abroad. The Netherlands is reducing its herd by policy; Belgium, Germany and the United States are where FrieslandCampina has bought growth. Chief financial officers facing a regulatory cap on domestic capacity should look at which adjacent markets share their cost base and regulatory model, and move before the home shortage forces the price up. For a comparison with how a listed Dutch food company responded to the same pressures, see the story of how the Netherlands lost Unilever’s headquarters; for how another Dutch cooperative-rooted institution finances the sector, see the Rabobank article in the Banking & Finance pillar. Readers interested in how the greenhouse sector handled an equally severe input shock can read about Westland’s greenhouse cluster.

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