Vegan milk maker Oatly has unveiled plans for one of the world’s largest plant-based dairy factories to be based in the UK. It’s expected to produce 300 million liters of oat milk per year, rising to 450 million liters annually, and comes as the Swedish oat drink company pursues a potential IPO in the US.

Oats will be sourced locally across the UK, and the factory will supply the UK market. 

Located in Peterborough, England, Oatly says the new factory will provide an “end-to-end solution,” provide at least 200 new jobs, and will be a beacon of sustainability. 

Shift to dairy-free
It is anticipated to launch in Q1 of 2023. Oatly’s new factory is part of the company’s drive to create a systemic shift in society and the food system toward plant-based.

Last month, Oatly – which is backed by prominent celebrity and high profile investors including Oprah Winfrey, Jay Z, Natalie Portman, and former Starbucks chairman and CEO Howard Schultz – plans to go public by filing for an IPO in the US. 

The price and number of shares that could be purchased have not yet been determined.

The initial public offering is expected to take place after the Securities and Exchange Commission in the US completes its review process, subject to market and other conditions.

This move comes amid rising demand for plant-based milk alternatives as consumers seek better-for-you beverages with environmental credentials.

“We’ve taken the first official step toward pursuing a potential IPO by submitting a confidential F-1 registration statement with the Securities and Exchange Commission (SEC) in the US. And due to the confidentiality of the process, we can’t elaborate any further,” Linda Nordgren, Oatly communications manager, tells FoodIngredientsFirst.

Sustainability and future food 
The UK factory is part of the broader initiative from the alt-milk brand to build factories fit for the future, with efficient use of resources and minimal negative impact on the planet. 

Oatly aims to use 100 percent renewable energy and decrease its energy consumption, water consumption and waste by 75 percent each at the factory by 2029 compared to Oatly’s environmental footprint in 2019.

Addressing planetary health
The new factory will produce 300 million liters of oat milk per year at launch, with the capacity to grow to 450 million liters – making it one of the largest plant-based dairy factories in the world. 

This means plant-based dairy will be more accessible for consumers to switch to, helping them to reduce their climate impact, notes the company.

For example, according to climate footprint data, Oatly Barista Edition sold in the UK generates about 70 percent less CO2e than British cow’s milk, it says. 

“Questions about a potential UK factory have been circulating for a while, and we’re really excited to finally announce the news of its arrival in 2023. The UK is a really important driver of the global plant-based movement, with a growing demand for Oatly across the country, and we’re excited to supply this increased demand,” explains Ishen Paran, general manager at Oatly UK.

“We look forward to supplying the UK with more oat drinks. We’re even more excited to do it in a sustainable way,” adds Johan Rabe, chief supply chain officer at the company. 

“Like everything we do at Oatly, we’ve ensured that sustainability is core to our factory planning. Everything, from the sourcing of our oats, to the production of our product range specifically designed for humans, has sustainability at the heart of it. Even as we strive to grow one of the biggest plant-based dairy factories to its full capacity, this will still be our top priority.”