Scottish dairy farmers are to benefit from a £1 million investment that will increase the volume of spreadable butter being produced in Scotland.

Spreadable butter accounts for £3 in every £4 spent on butter in Scotland and has an estimated value of £63 million.

However, 96% of it is produced outside Scotland and Graham’s, the Stirling-based dairy is hoping to grab a bigger slice of the market by launching new ranges.

The family-owned business has invested £1m at its Aithrey Kerse Farm in Bridge of Allan to increase its spreadable butter capacity and capabilities as well as creating more flexibility in its production.  Part of the investment was aided by the Scottish Government.

Graham’s new lighter and organic spreadable butters join Graham’s existing range which went on sale in 2011.

Robert Graham, managing director (pictured above left), said spreadables account for 70 per cent of butter sales in Scotland, and its own range is already the fastest-growing spread on the market, with sales up 76% year-on-year. However, this is just 4% of the market.

“Our focus is growing our presence in retailers across Scotland before we look south of the border, as there is a lot to go at on our home turf,” he said. “Looking further ahead, we’re also exploring the export market and will be attending the world’s largest food fair Anuga in Cologne in October to consider opportunities.

“Butter is a category that performs well and the market will experience continual growth with spreadables.”

“Creating products like this is crucial in helping to give farmers an outlet for their milk.  By launching these products, we’re not only boosting our own business but we’re also supporting the 98 dairy farmers who we work with throughout the country.”

New research figures show that half of the households in Scotland now buy Graham’s products every year.  During 2015, 11% are buying Graham’s Spreadable Butter, against 7% in 2014.

Rural Affairs Secretary Richard Lochhead (pictured above right), said:  “This is a very welcome development from Graham’s. It is great to see new products being introduced to the market and it reinforces their commitment to securing the future of the sector – something the Scottish Government very much supports, as set out in our recently-published Scottish Dairy Plan.

“The level of investment Graham’s has ploughed into its production at its Airthrey Kerse Farm is impressive and I’m delighted some of the funding came from the Scottish Government’s food processing, marketing and grant co-operation scheme.”

Graham’s grew its sales by 25% in the year to 31 March to £85m, with its pre-tax profits rising to £1.3m.

In March, the company unveiled plans to build a £20m dairy, research centre and training academy in Stirling, which will create 450 jobs including 50 apprenticeships.

Analysts estimate that the 150,000 square-foot facility – which will include production lines for milk, cream, cheese and spreadable butter – will generate an extra £20m for Stirling’s economy.

The proposed site will be in addition to Graham’s existing operations at Airthrey Kerse, its processing plant in Nairn and its depots throughout Scotland.