Oatly invests $16 million to expand Swedish production plant

Oatly has announced a $16 million multi-year investment to expand its Swedish production facility in Landskrona, increasing capacity to meet accelerating global demand for plant-based drinks.

Construction at the Swedish site will begin in March 2026 and is expected to be completed by March 2027. Once finished, the refurbishment will boost the factory’s production capacity by more than 33 percent, increasing output from 150 million litres to 200 million litres annually without expanding the plant’s physical footprint.

The Landskrona facility, which has been operational since 2006 and employs more than 300 people, sources 100 percent renewable energy. Oatly said the investment, alongside efficiencies in ingredient sourcing and its distribution network, will help reduce the company’s overall corporate climate impact in 2026 and 2027.

Simon Broadbent, SVP Sustainable Operations at Oatly, said:

We’re seeing growing demand for our products, so the time is right to upgrade our Landskrona site which has performed fantastically well in recent years, both in stability of output and outstanding cost management.

The Landskrona factory is a key site for us, not only because of our roots in Sweden, but also because it’s a fully owned, end to end production hub and home to many of our core functions. You can think of it as one big oat campus.”

Demand growth drives investment

The expansion comes as demand for plant-based drinks across Europe rebounds, with the category growing 6 percent over the past year. Oatly reported double-digit regional growth during the same period, with out-of-home and foodservice channels increasing by more than 20 percent.

The company attributes part of this momentum to new product and channel innovations developed in Sweden, including additional Barista Edition flavours and out-of-home concepts such as the Oatly Baristamatic automated coffee machine system.

Increasing production at the Landskrona plant will also lead to higher oat sourcing from Swedish farmers. The facility currently exports around 70 percent of its production, with that share set to rise as demand grows in markets including Germany and the UK, as well as emerging markets such as France and Spain.

The investment follows the company’s full-year 2025 financial results, where the capital expenditure plan for 2026 was first outlined. Oatly reported profitable growth in both the fourth quarter and the full year.

Jean-Christophe Flatin, CEO of Oatly, said at the time:

Achieving this milestone reflects the disciplined, strategic actions we have taken over the past three years to strengthen the foundation of our entire business. We have right-sized our supply chain and overhead structure while simultaneously reinvesting behind our refreshed growth strategy.

As we look forward, we see significant potential ahead, and we are confident that we are taking the right steps to drive durable, scalable, and profitable growth as we execute on our mission.”