Sunday, 28 December 2008

Sadia, Brazil inaugurates plant in Russia

About one month after losing its leading position on the domestic food market to Perdigao, chilled and frozen pork processor Sadia announced on Monday the inauguration of its first production plant outside Brazil.

The plant, trading under the name of Concord, has been established in Kaliningrad, Russia in partnership with Miratog Holding, one of Russia's larger distributors of meat.

Sadia contributed about 60 percent of the US$90m dollars investment, while the Russian partner provided 40% of the capital.

New plant
Initially, the new plant will produce 53,000 tonnes of meat products per year, but may trade up to 80,000 tonnes under the Sadia and Myasnaya Guildia brand names.

Walter Fontana Filho, Chairman of Sadia's Board of Directors expects that this cooperation will support Brazil's export opportunities especially because of the huge export potential for Sadia products.

Besides servicing the consumers directly, the production plant will also supply the McDonald's fast food outlets in Russia. Sadia has already signed up partnerships with this fast food chain in Latin America, UK, France and Germany.

Source: www.pigprogress.net December 2008

Thursday, 25 December 2008

The sleeping Russian bear awakes with an appetite for meat

Russia is the largest country in the world, covering 17,075,400 square kilometers, from the Bering Sea twenty kilometers from Alaska, to the Baltic Sea in Europe. This emerging economy has an insatiable appetite for western meat, as well as meat technology and equipment

Whilst little was known about the old Soviet Union, which included all countries east of Germany, even less is known about modern day Russia and its 142 million population. This is a nation that is debt free, oil rich and eager to do business, Moscow the capital is the most expensive city in the world. There are more billionaires residing in Moscow than in London or New York.

The Soviet Union from the end of the second world war until 1991, controlled its "satellite countries" of Poland, Hungary, Romania and the former Yugoslavia, which are the best beef producing countries in eastern Europe, with a combined cattle herd of 125 million cattle. In the Soviet days these countries exported prime beef to western Europe, with ample supplies left over for the domestic market. Yugoslav and Romanian beef was considered the best in the world, suckled on small farms and hand fed like family pets.

Since 1991 and the fall of the Soviet bloc, when independence came for the satellite countries, Russia turned to South America for its beef imports and more recently Australia. The United States, Denmark and Germany catered for poultry and pork supplies. The previously mentioned satellite countries, turned to the west and now are members of the European Union, restricting them from exporting meat to Russia.

The cattle herd in Russia today is 25 million head , whilst the nations total meat requirements are 7.5 million tonnes. Russians consume 50 kilos of meat per capita, a figure that is increasing at extraordinary rates. Projections are that by 2012, Russia will consume 10 million tonnes of meat per year. Domestic production of meat currently provides 4.7 million tonnes, leaving a shortfall of 2.8 million tonnes to be imported, making Russia the worlds largest meat importer.

Meat is imported under a government quota system, which falls into two categories, Manufacturing and Retail meat quotas. The quota for 2008 is Manufacturing beef 445 thousand tonnes, Retail beef 450 thousand tonnes, Pork 493.5 thousand tonnes and Poultry meat 1.21 million tonnes.

Traditionally beef and pork are the most popular meats, along with many varieties of sausages, eaten cold in summer and hot in winter often in broth or stew. Poultry consumption has tripled in the last fifteen years, with imports now being double those of pork. The emergence of a wealthy middle class with high disposable incomes, has seen a high restaurant culture and the demand for more delicacies, in primal cuts of imported beef.

The prime beef imports fall into two categories, the first being, round cuts, Topside, Silverside and Knuckle, for the high class trade. Secondly Chuck & Blade, which is divided into seven different cuts, providing secondary steak for stewing meat catering for the working class trade. This beef comes under the Retail quota system, with higher import duties than those of manufacturing meat.

The trade for manufacturing beef, which is used in the production of burgers, sausages and kebabs, accounts for 40 percent of the beef imported. This product is block packed frozen manufacturing cow hindquarters and forequarters and beef trimmings, Russia buys all the beef trimmings available in South America.

Australia has pioneered a lucrative trade in kangaroo meat, with the Far East of Russia in the frozen parts of Siberia, Kamchatka and Vladivostok, where the diet was previously reindeer and horse meat, mainly used in broth because of the cold artic temperatures. The plants in the Far East, have readily adapted to the use of kangaroo meat in sausages, salami and for general retail trade as stewing meat, replacing the need for reindeer meat. This trade has been very beneficial to Australia and for Russia who could never obtain sufficient quantities of reindeer meat. Australia are the main suppliers of horse meat to Russia followed by Argentina.

Russia plans to be self sufficient, in the production of pork and poultry within the next five years, however beef production cannot catch up with demand for at least fifteen years.
Russia is the only country in the world, where carcass’s are water brushed after slaughter in the primitive abattoirs, which significantly reduces the shelf life to 10 days mazimum. Whereas the shelf life of Argentine or Brazilian chilled beef is 120days. Russia will produce an additional 300 thousand tonnes of poultry meat this year, along with an extra 200 thousand tonnes of pork by 2009.

The farming opportunities are enormous, with European companies building multi million dollar pig farms and poultry units. The regulations are not as stringent as in the European Union, in regard to effluent disposal and farrowing crates. This will change as time goes on but currently the development is moving at such a rapid pace, trying to keep up with the governments ambitions for self sufficiency in meat production. There are unlimited opportunities for supplying tractors and farm machinery, as well as the latest technology in intensive farm production.

There are 25,000 small meat and food processing companies in Russia, employing 1.5 million people turning over seventy billion dollars a year. There are opportunities for new and used meat machinery such as mincers, sausage machines, slicers and mixers, as much of this work is still done by hand. The very old fashioned butchers shops still use handsaws and make sausage with hand filling machines, labor is readily available and until recently was inexpensive. Argentine Beef Packers SA. have extensive lists of agents and processors in Russia, which could benefit International suppliers of meat and food equipment.

The majority of the European supermarket chains are now operating in Moscow, which has a population of 12 million and in the second city St Petersburg, whose population is around 5 million. McDonalds, Kentucky Fried Chicken, Pizza Hut and Starbucks can be found on every corner, along side the showrooms for Rolls Royce, Bentley and Porsche, Russia is the worlds largest buyer of all three makes of car.

The major meat giants such as JBS-Swift, Mafrig SA, Sadia, AIBP Ireland, JBS Foods Atlanta, Tysons Foods, Cargill Inc and Smithfield Foods, all have trading offices or appointed agents with English speaking personnel, in the main port of St Petersburg and of course in Moscow. Nestles, Mars, Danone, Hochland Lactalis and many other well known names, can also be found in Russia, actively involved in their own food processing factories. Barclays and HSBC Banks are active in Russia, as well as respected American, European and Russian banks.

There has been a big chill in relations between Russia and the United States, following tensions over the war in Georgia and the Russian recognition of breakaway provinces as independent states. The dramatic and swift action of Russia, in banning 19 American meat plants from exporting to Russia, coupled with the cutting of the US poultry quota by 300 thousand tones in September, have created an opportunity for countries like Australia and Brazil, to fill the void created. Russia is the largest buyer of American poultry products importing 870 thousand tons last year, they are the second largest buyer of pork products from the United States after China.

The meat is retailed by the supermarket chains in all of the cities, which have taken the place of the communist government subsidized stores. Retail butchers can be found in rural areas, along with butchers operating from stalls in open markets. There are many Kosher butchers in Moscow and St Petersburg, selling traditional Jewish products as they have for 1,000 years.

The annual Russian Meat Industry Trade Show, is being held next year on 16 March 2009 in Moscow.. The show which last three days is the only specialty meat exhibition that is held in Russia each year. Exhibitors can be found displaying the full technological meat cycle from raw meat and raw poultry, to processing, packaging and machinery available to the trade. The exhibitors profile food processing machinery from all over the world. the organizers are Global Expo Management, 23 Gogolevski Boulivard, Moscow telephone 007-95-1012274 www.meatrussia.com
The South American beef processors have stands at the show each year, along with the Irish and German meat exporters. The majority of the food and meat equipment exhibitors are European companies.


Government enjoys 70% approval rating.
Economy has been debt free since 2003.
Main exports oil and gas, vodka and caviar.
Food industry turns over US$70 billion per year.
Worlds fastest growing food, wine and beverage market.
Imported cheese 50,000 tonnes per year.
Meat consumption 7.5 million tonnes per year.(50 kilos per capita)
Worlds largest importers of horse meat.
Grain harvest 95 million tonnes.
Arable farms 46.3 million hectares.
Potato harvest 81,600 tonnes (base for vodka)
Worlds largest caviar harvest.
Prior to 2002, 50% of meat came direct from farm slaughterhouses with no regulations.
Russians consume 220 liters milk per capita
Russians consume 50 kilos meat per capita
Fruit consumption 47 kilos summer, 27 kilos winter per capita.
Decline expected in poultry and pork imports, poultry production 1.85 million tons..
Cattle herd 25 million.
Pig herd 30 million, multi million dollar piggery’s a common sight.
Government plans to increase pork production, to 500,000 tons p.a. by 2112., with government assisted farms and foreign investment piggery’s.

New pork processing meat plants are on government agenda.

There are 16 million hectares of arable land, available for cultivation, in need of foreign or government investment.

Self sufficient in wheat, barley, potato’s and exporters of rye.

Source: www.farminguk.com

PKM Duda, Poland - Expands activities

Polish meat exporting giant PKM Duda, is to expand into the local market with its pork products and concentrate on a new domestic marketing drive, into the market of the Ukraine.

The company operates its own pig farms and pork processing plants, previously it has only concentrated on the export market.The rise in the Polish economy in recent years, now makes the domestic market very attractive.

The main meat plant at Grabkow, produces 30-40% of the companies own livestock, produced on company farms.

The company president Maciej Duda, said "we will not give up the acquisitions of new processing plants, but for the time being we have suspended talks with several companies willing to sell, we are first going to update our existing facilities".

In recent years the company has purchased many pig farms in Poland.

Source: www.farminguk.com - December 24, 2008

Danish Crown, Denmark - Interview with Mr. Carsten Jacobsen

Carsten Jakobsen står i spidsen for udenlandske milliardforretninger i Europas største slagterikoncern, Danish Crown.

Når hverdagen bliver for grå, eller problemer og udfordringer skal gennemtænkes, bruger han gerne nattetimer i laden. En dvd sættes i det vellydende musikanlæg med kvalitetshøjttalere og en storskærm. Anlægget fylder endevæggen i rummet, hvor moderne dansk kunst pryder de øvrige.

Høj musik udført af favoritmusikere som Chris Barbers jazzband og andre i samme genre strømmer ud i lokalet, mens koncerndirektør Carsten Jakobsen sidder i dets store, hvide flydesofa og lader tankerne falde på plads.

Det har der ofte været brug for. Han står nemlig i spidsen for en milliardvirksomhed, som er vokset hastigt de senere år gennem opkøb. Store beslutninger har derfor skullet træffes. Men det netop aflagte årsregnskab viser, at den danske koncern, som ejer virksomheden, aldrig har tjent så meget som nu på dette marked.

Carsten Jakobsen har i 10 år været viceadm. direktør for den danske slagterigigant Danish Crown, som er Europas største inden for svinekød. Han står i spidsen for den danske koncerns aktiviteter i USA og Storbritannien. Det britiske fødevareselskab Tulip Ltd. udgør i dag ca. en fjerdedel af den danske koncerns omsætning og har 9.000 medarbejdere fordelt på 21 engelske fabrikker.

Den viceadm. direktør har som de øvrige chefer kontor i Danish Crowns hovedsæde i Randers. Men han har faktisk siden 2002 boet fast i England. Nærmere bestemt den midtengelske by Stratford-upon-Avon mellem Birmingham og London - tæt på Tulip Ltd.'s hovedsæde samt i centrum for selskabets fabrikker.

Synlig chef
Carsten Jakobsen er nemlig en chef, som gør en dyd ud af at være synlig og tæt på organisationen samt kunderne, der i England er landets førende detailkæder. Han siger selv, at han ikke egner sig til at være fast placeret bag et skrivebord i et hovedsæde:

»Min opgave er at få forretningen til at køre. Det sker bedst ved at være her, hvor det foregår. Jeg har flere end 100 rejsedage om året, men det er nødvendigt i dette job,« siger Carsten Jakobsen, mens han viser rundt i det engelske hjem.

Det består af en stor villa i udkanten af Stratford-upon-Avon med en parklignende have. Her ligger også det, som Carsten Jakobsen selv kalder laden. Oprindelig var det en slags lade, men er i dag en totalmoderniseret bygning - placeret i den ene ende af haven - med en moderne gildesal. Det er direktørens egen hule med musikanlæg og rig mulighed for at høre høj musik uden at genere andre.

Kontant med bløde punkter
Musikken betyder nemlig meget for den danske direktør, der i branchen er kendt som en kontant chef. Han lader ikke nogen i tvivl om, hvad han mener, hvis tingene ikke går, som de skal eller bør.

Blandt de bløde punkter er - ud over familien - også musikken. Carsten Jakobsen med en lang erhvervskarriere bag sig på ledende poster i danske virksomheder har siden barndommen i Ikast altid holdt af især jazz, blues og gospel.

Det har fulgt ham hele livet, selv om han aldrig selv er blevet aktiv musiker. I stedet ejede han gennem en længere årrække og frem til 1993 det nu lukkede Jazzhus Slukefter i Tivoli sideløbende med, at han var direktør i erhvervslivet. Han var selv ansvarlig for at booke musikken for jazzhuset.

»Det var en fantastisk tid, hvor jeg fik mange gode venner i musikkens verden. Musikere som jeg fortsat ser og taler med, når jeg kommer rundt i verden. Jeg arrangerede bl.a. koncerter med BB King og andre store navne. Jeg måtte dog til sidst konstatere, at det ikke kunne gå både at have en erhvervskarriere med et ansvarsfuldt job og så samtidig drive musikhus i fritiden,« fortæller Carsten Jakobsen.

Han viser den store musiksamling med cd' og dvd'ere frem.

Den rummer mange store navne fra den internationale scene men med vægt på især kunstnere som Louis Armstrong, BB King, Frank Sinatra, Chris Barber - og naturligvis danske Papa Bues Jazzband, som var husorkester i Tivolis Slukefter.

»Musik betyder alt for mig. Ved at sidde en nat og lytte til mine favoritmusikere kan jeg få tankerne på plads. Hver gang der er problemer, sætter jeg mig alene i laden og lader tankerne flyde til musikken. Det er den bedste opladning, som jeg kan få.«

Ud over Danish Crowns britiske aktiviteter står Carsten Jakobsen også i spidsen for det amerikanske datterselskab Plumrose USA, ligesom han som viceadm. direktør tager del i den daglige drift af den samlede danske koncern.

Vanskeligt år
Selvom den danske, landmandsejede slagterigigant aldrig har tjent så mange penge som nu i Storbritannien, erkender chefen, at der må arbejdes hårdt. Det kommende år kan nemlig blive vanskeligt på grund af den økonomiske krise.

»Detailkæderne og forbrugerne her efterspørger i øjeblikket billigere produkter, så derfor sker der betydelige forandringer i sortimentet. Det er afgørende med innovation og produktudvikling for at leve op til kravene. Vi skal samtidigt blive endnu mere omkostningseffektive og dermed konkurrencedygtige. Det må vi konstant arbejde på,« fastslår Carsten Jakobsen.

Tulip Ltd. er siden etableringen i 2001/02 vokset gennem først to store opkøb og for et år siden også ved overtagelse af en tredje større konkurrent. Ud over lokal produktion af fødevarer er selskabet også den største aftager af svinekød fra danske Danish Crown.

I forbindelse med opkøbene har Carsten Jakobsen og hans nærmeste medarbejdere gennemført store forandringer med lukning og samling af aktiviteter samt reduktioner i medarbejderskaren:

»Det har været nødvendigt at skære hårdt til og effektivisere i det engelske selskab. Opgaven er lykkedes, så vi nu har en meget solid position på markedet. Vi skal dog fortsat arbejde hårdt og gøre alt for at blive endnu mere konkurrencedygtige,« mener Carsten Jakobsen.

På spørgsmålet, om det kan betyde, at Tulip - og dermed Danish Crown - skal købe endnu mere op i Storbritannien for at øge markedsandelen, lyder svaret:

»Der er nok en klar grænse for, hvad konkurrencemyndighederne her vil tillade, da vi allerede har en betydende position. Så det ligger nok ikke i kortene netop nu. Det står dog fast, at i kraft af finanskrisen er markedsværdien for en del kødvirksomheder i verden - også her i Storbritannien - nu faldet betydeligt.«

Under en rundtur på Tulip-fabrikker ses han det ene øjeblik uddele kindkys til receptionisten, der giver en overstrømmende velkomsthilsen. Kort efter er tonen meget mere alvorlig, da Carsten Jakobsen diskuterer en beslutning med en ledende medarbejder over telefonen.

Carsten Jakobsen er selv bevidst om, at han hos både tidligere og nuværende medarbejdere har ry som en kontant chef.

»Jeg er ikke typen som putter med tingene. Hvis beslutninger er nødvendige, skal de træffes og effektueres. Også uanset hvor ubehagelige de er. Det allervigtigste aktiv i en virksomhed er helt klart medarbejderne. Derfor gør jeg også meget ud af at vise tillid og uddelegere ansvar. Vi har meget dygtige folk, som sikrer, at vi kan nå resultaterne.«

Trods han er chef for en milliardkoncern i England, hvor omgangsformen generelt kan virke mere stiv og formel i erhvervslivet end den kendes i nutidens Danmark, omtales chefen som Carsten. Alle medarbejdere er på fornavn med ham.

Netop den mere uformelle stil er ifølge Carsten Jakobsen helt naturlig i en dansk koncern som ejes af danske landmænd. Netop det adskiller - ifølge ham - jobbet fra så mange andre topposter i erhvervslivet.

»Vores hovedopgave er at sikre de danske landmænd den bedst mulige afregning. Dansk landbrugs andelsstruktur, hvor leverandørerne sammen ejer virksomheden, er enestående,« mener Carsten Jakobsen.

Forskellighed giver styrke
Han har de seneste 10 år stået i spidsen for Danish Crown sammen med adm. direktør Kjeld Johannesen. Selskabet blev i 1998 dannet gennem fusion mellem selskaberne Danish Crown og Vestjyske Slagterier, hvor Carsten Jakobsen var adm. direktør. Om det nu mangeårige parløb siger han:

»Det fungerer fortsat rigtig godt. Vi er på en række områder forskellige, men det giver samlet styrke. Naturligvis er vi ikke altid enige, men efter at have diskuteret tingene bag lukkede døre og nået frem til en konklusion, fremstår vi altid med én klar holdning, som vi begge bakker op. Det er en af forklaringerne på, at vi i 10 år har kunnet arbejde så tæt sammen. Selvom vi ikke fysisk sidder op og ned ad hinanden dagligt, er vi hele tiden i kontakt via telefonen, så den anden ved, hvad der sker,« fortæller Carsten Jakobsen.

Selvom han netop er fyldt 63 år, har han ingen planer om at trække sig tilbage og blive efterlønner eller pensionist. Faktisk mener han, at han aldrig har haft det så godt med arbejdslivet som nu.

Han forklarer også samtidig, at han jo har en ung familie, som er med til at holde ham selv ung. Carsten Jakobsen og den jamaicanske fødte hustru, Christine, har to sønner på 7 og 18 år, som sætter fut i huset.

Carsten Jakobsen fastslår dog, at når han en dag stopper med arbejdet i Danish Crown er drømmen klar for fremtiden. Igen spøger musikken:

»Vi vender nok ikke tilbage til Danmark. Vi lever nu i England og trives med det. Jeg elsker mit job og har ingen som helst planer om at skulle stoppe. Men hvis og når jeg en dag ikke længere skal passe det nuværende arbejde, vil det være fantastisk at få en jazzklub i London. Der skal spilles traditionel jazz, blues og gospel. Musik der gør alle glade.«


Blå bog:
========
Carsten Jakobsen, 63 år.
Født og opvokset i Ikast.
1975-1984: Direktør i virksomhederne Sthyr & Kjær, Lund & Rasmussen, Dagros, Brdr. Justesen, Dagrofa.
1984-1990: Adm. direktør SAS.
1990-1994: Adm. direktør Bording A/S.
1994-1996 Adm. direktør Hatting Bakery International.
1996-1998 Chief Executive Officer, VJS Holding, UK.
1998 -: Adm. direktør i Vestjyske Slagterier. Efter fusionen med Danish Crown viceadm. direktør i andelskoncernen med særligt ansvar for Storbritannien og USA.
Fra 2002 base i England. Bor i byen Straford-upon-Avon sammen med hustruen og to sønner.

Danish Crown
============
Europas største svineslagteri.
Ejes af 12.152 andelshavere - danske landmænd.
Ud over aktiviteter inden for svine- og oksekød rummer koncernen også kødforædling.
Blandt datterselskaberne i ind- og udland er: Tulip Ltd (UK), Tulip Food Company (DK), Plumrose USA, Sokolow (PL), Danish Crown Livsmedel AB (S) og Ess-Food (DK).
Nøgletal 2007/08:

Omsætning: 47 mia. kr.
Resultat primær drift: 1,8 mia. kr.
Egenkapital: 4,1 mia. kr.
Antal medarbejdere: 25.059.

Tulip Ltd.
==========
Datterselskab i Danish Crown.
Står for koncernens aktiviteter inden for forædling og fersk kød på det britiske marked.
21 fabrikker i England og knap 9.000 ansatte - heraf godt 1.000 kontraktansatte.
Vokset gennem tre store opkøb: Hygrade Foods (2003), Flagships Foods (2004), Geo Adams & Sons (2007).
Vokset gennem tre store opkøb: Hygrade Foods (2003), Flagships Foods (2004), Geo Adams & Sons (2007).
Omsætningen i 2007/08 blev knap 11 mia. kr. - fire gange mere end i 2001/02, da selskabet blev etableret.
Omkring 30 pct. af det danske svinekød i Danish Crown afsættes i Storbritannien.

Source: www.epn.dk December 10, 2008

China-Meat company expands operations.

Zhongpin Inc.the leading meat processor in China, is undergoing massive expansion plans and will increase meat production by 114% in 2009..
The new premises being built in the Henan Privince, at Changge City, will be the largest meat processing complex in the country.

The capacity will be in access of 1,200 tons of processed meat per week.
Xianfu Zhu, the CEO of Zhongpin, said in a press conference in November, "Zhongpin prepared meat products have enjoyed heightened brand awareness among customers due to their superior taste and quality. We believe the additional production capacity will increase the contribution of prepared meat products including a variety of sausages and hams. These products also have a higher gross profit margin".

The company specializes in pork products, which it distributes throughout 24 provinces, in 2,960 retail outlets.

The company’s plant is European Union approved, they export to Russia, Hong Kong, Japan and South Korea.

For more information on Zhongpin www.zpfood.com

www.farminguk.com on 24/12/2008 01:37:22

Tuesday, 23 December 2008

Schwan Food Co., USA sells European pizza business

The Schwan Food Company says it's selling its European frozen-pizza businesses to Dr. Oetker UK Ltd, and the Freiberger Group.

Dr. Oetker will acquire the pizza production plant in Leyland, England, and the Chicago town frozen-food brand. It will also be allowed to sell Freschetta and Tony's brands in Europe through a licensing agreement with Schwan, which is based in Marshall.

Schwan says in a release that it decided to sell part of its European business so it can focus on the growth of its business in North America.

The company says the agreements were signed Tuesday and it expects sale to be finalized by year's end.

Schwan will keep a production facility in northern France.

Source: www.examiner.com

Smithfield Foods, Inc., USA announced on Dec17/08 that the merger of Campofrio Alimentacion S.A. and Group Smithfield Holdings S.L. has been finalized

Smithfield Foods, Inc. (NYSE: SFD - News) announced today that the merger of Campofrio Alimentacion S.A. ("Campofrio") and Group Smithfield Holdings S.L. ("Groupe Smithfield") has been finalized. The new company will be known as Campofrio Food Group and will be listed on the Madrid and Barcelona Stock Exchanges.

The merger creates the largest pan-European company in the packaged meats sector and one of the five largest worldwide. The company is the market leader in Spain, France, Portugal and The Netherlands, and maintains an important presence in Romania, Germany, the United Kingdom, Italy and Belgium.

Smithfield Foods owns 37 percent or approximately 37.8 million shares of the new company. Previously Smithfield owned 24 percent of Campofrio and 50 percent of Groupe Smithfield. Other significant shareholders are Oaktree Capital (24 percent), Pedro and Fernando Ballve (12 percent), Diaz Family and Luis Serrano (five percent), Caja Burgos (four percent) and QMC (two percent). The remaining 16 percent will be held by the public.

"This is a major step in Smithfield's strategy to grow and improve its global packaged meats presence. The companies have complimentary manufacturing and marketing platforms, presenting the opportunity for value creation and synergies," said C. Larry Pope, Smithfield Foods president and chief executive officer. "The merger produces the leading player in the European packaged meats market, with leading brands in every market in which we operate," he said.

Mr. Pope noted that this transaction converts Smithfield's Western European ventures into a more liquid investment, with its shares in the publicly-traded company having a market value of over $350 million, based on closing price on December 2, 2008.

With sales of $12 billion, Smithfield Foods is the leading processor and marketer of fresh pork and packaged meats in the United States, as well as the largest producer of hogs. For more information, visit http://www.smithfieldfoods.com.

Source: Smithfield Foods, Inc.

Monday, 15 December 2008

Cargill, USA to acquire Carneco Foods plant, USA

A Cargill Meat Solutions division is expected to finalize the purchase of a Carneco Foods beef plant in Columbus, Neb., in January after signing a purchase agreement late last week.

The final closing, according to the Columbia Telegraph, is slated for Jan. 2. Cargill Value Added Meats will assume control of operations beginning Jan. 5.

Cargill had been in the market for a new plant since fire destroyed its Booneville, Ark., plant on Easter Sunday. Lopez Foods Inc., Oklahoma City, Okla.-based owner of Carneco, approached Cargill to buy the Columbus facility, John O'Carroll, president of Cargill Value Added Meats, was quoted as saying.

Cargill initially focused on site selection for a new facility, but the company couldn't pass on this opportunity. "We had planned to build a plant in Texas," O'Carroll said, but Cargill instead opted for a "beautiful plant in a great state that is pro-business with a tremendous workforce."

O'Carroll said Cargill will produce frozen and fresh ground beef product for retail and foodservice from the Columbus plant and expects Carneco's current operations to continue without changes.

Carneco produces frozen beef patties, beef chubs and fresh ground beef for fast-casual restaurants, retail outlets and the food service industry.

www.meatingplace.com

Tuesday, 9 December 2008

Grandi Salumifici Italiani, Italy took first steps towards the stock exchange in November 2007

Board of administration newly elected – Turnover shows plus of three percent in first half year of 2007.

Modena/Innichen – The board of administration of Grandi Salumifici Italiani (GSI) has taken the next step for listing shares on the Italian Stock Exchange. On Wednesday, the 10th October 2007, the company handed over the necessary documents to the Italian Consob and the Borsa Italiana for listing at the Star-Segment of the Mercato Telematico Azionario (MTA). The Consob must accept these documents and the Italian Stock Exchange must give approval for quotation, before GSI can start listing shares.

The global offering is directed at Italian citizens, institutional investors in Italy and abroad, with exception of the USA, Japan, Australia and Canada.

Lead-Manager is Mediobanca, JP Morgan and BNP Paribas will act as Joint Bookrunners while Unipol Merchant was chosen as the designated sponsor of the emittent. Deloitte & Touche will act as auditors. Legal advisors are Dewey & LeBouef, Clifford Chance act as advisors to the coordinator of stock brokerage.

Newly elected board of administration

General director Claudio Palladi was named chief executive by the board of administration. Palladi has been given full authority by president Franz Senfter and vice-president Ildo Cigarini.
The newly elected board of administration is made up of four active members (Franz Senfter, Ildo Cigarini, Claudio Palladi and Helmuth Senfter), three non-active members (Heinrich Riffesser, Milo Pacchioni, Gianni Mozzoni) and four independent members (Stefano Baraldi, Ivano Barberini, Maurizio Labanti and Giuliano Righi).

First half-year 2007: turnover up by 3 percent

The turnover amounted to 201,4 million Euro showing an increase of 3 percent in the first half year. Sales amounted to nearly 36.000 tons of processed meats. The consolidated EBITDA was at 24,9 million Euro (2006: 17,4 million Euro). Consequently, the EBIT rose by 67 percent to 17,8 million Euro. The net gain amounted to 12 million Euro which correlates to a 94 percent increase compared to 2006.

Source: www.senfter-holding.com

Thursday, 4 December 2008

Nortura, Norway and Spis Grilstad, Norway cuts costs in Troendelag, Norway

Nortura and Spis Grilstad joins forces to cut costs of slaughtering in Troendelag, Norway.

Nortura takes over and will complete construction of the Malvik city plant to contain a larger slaughter volume and contract slaughter for Spis Grilstad.
Competition about consumers and meat suppliers continues uninterrupted as before.

Nortura BA and Spis Grilstad AS (inclusive part owned and owned in conjunction) both faces large over capacity with a lot of smaller and older meat slaughter plants which needs a lot of maintenance as well as new technology. To centralize the two companies slaughter for cattle and lamb reduces costs and is to the benefit of everyone. The solution is industry correct in order to solve the task of the society to the lowest costs possible.

“This is an industrial and business wise justified solution with focus in our strong market position for top quality meat products. This gives us the opportunity to further developing our business and to become even better. The task of constructing a new plant was too big of a mouthful, however, by contracting the slaughter capacity instead of owning the plant ourselves we reduces our costs and financial obligations” says CEO Mr. Asbjoern Reinkind, Spis Grilstad.

Nortura takes over the Mavik plant, expands it and finishes the building as well as takes over responsibility of purchase agreements for machinery, equipment etc. The total investment is approx. 500 mill Nkr. (approx. Euro 56,9 mill). The new plant of 20,000 sqm will be the largest cattle and lamb slaughter plant in Norway with slaughter capacity of 83.000 cattle and 185.000 lamb. 272.000 pigs will be slaughtered at Nortura Steinkjer where approx. 100 mill Nkr. (Euro 11,4 mill) was recently invested.

“It is important to cut costs as much and as fast as possible. Also considering the international competition is knocking on our door. To take over the Malvik plant and perform contract slaughter for our business partners is a good and reasonable solution, for all parties involved, and secures a strong and ongoing meat industry in Troendelag. Strong competition in the Norwegian shops is also inspiring for a company of strong brands like Nortura” says CEO Mr. Sveining Svebestad.

The Malvik plant is planned to be in full operation in the spring of 2010 and is expected to employ approx. 200 team members. 8 existing plants and approx. 300 teammebers will be affected.

Source: www.nortura.no

Wednesday, 3 December 2008

Smithfield Ferme, Romania debuts 30 million euro facility in Timis County

Smithfield Ferme, the Romanian farm division of the US-based Smithfield group, on November 5 organized the ribbon-cutting ceremony for a mixed fodder plant that was built in the western locality of Vinga (Timisoara County), with an investment of 30 million euros.

“This is the largest Smithfield Ferme investment so far, applying state-of-the-art biosecurity measures,” said PR manager Mihai Sepetean.
The decision to place the farm in this locality was reached due to the favorable combination of raw material (cereals) and climate elements specific to Vinga, said Bogdan Mihail, company director general.

The Smithfield Ferme management underscored that the contractor that built the facility is America’s Ibberson, which has an experience of 125 years in the business.
“We completed the construction in the same time as it would have taken us to do it in the US and we had a team of American managers and 300 Romanian workers,” said the Ibberson representative.

In America, Ibberson received an excellence award for the professionalism shown in carrying out the project sited in Timis County.
The construction works kicked off in May 2006 and the first granular fodder left the production line in May 2008.
The plant has a weekly capacity of 8,000 tons per shift and is completely automated, having just 14 operators to service it.

The Smithfield Ferme investment program will continue with a 20 million euro pig farm with a capacity of 10,000 animals.
The fodder plant in Vinga, just like the other Smithfield Ferme facilities, produces exclusively for the needs of the pig breeding units run by this company. Smithfield Ferme’s policy is to encourage local farmers and therefore purchases the bulk of the necessary cereals from Timis County producers.

Source: www.financiarul.ro

Net Profit of Agribusiness Holdings “Miratorg”, Russia to Grow by 88%

27 november 2008
Net Profit of Agribusiness Holdings “Miratorg” under International Accounting Standards (IAS) grew 1.88-fold for 9 months of 2008 in comparison with the corresponding period of 2007, and totaled to 43.6 million Euros.

The revenue increased by 40% up to 595.38 million Euros for the reporting period. EBITDA rate grew by 87% and totaled to almost 62.2 million Euros, and profitability under EBITDA increased from 7.84 to 10.45%, which exceeded the estimated rates. The profitability growth is a priority task of the company’s development strategy, and it’s implemented thanks to growth of own production volumes and putting into operation of new high marginal projects.

Subsidiaries of Agribusiness Holdings “Miratorg” have shown a stable growth for 9 months of 2008, having exceeded the operation data of the corresponding period of 2007. Production segment is a priority business line of “Miratorg”. Net profit from pork production increased more than double up to 30.1 million Euros for 9 months of 2008, the sales volumes grew by 70% and totaled to 27 thousand tons (live weight), and total pig stock increased 2.37-fold up to 405 thousand heads at complexes of “Miratorg”. The main source of such growth is Pig Complex “Berezovsky” and Pig Complex “Bolshansky” which were opened in December 2007 and February 2008 respectively, and have already managed to reach full production capacity.

Five new production blocks were put into operation for the reporting period: Pig Complex “Safonovsky”, Pig Complex “Ivanovsky” and Pig Complex “Prokhorovsky” in February, one in Pig Complex “Yakovlevsky” in July, and one in Pig Complex “Novoslobodsky” in August. “Miratorg” expects that in 2009, when the aforementioned complexes reach full projected capacity, pork production output will grow up to 1.15 million heads or 130 thousand tons per year (live weight).

The Group’s grain subsidiary increased the farm land area 2.7-fold (to compare with the corresponding period of 2007) up to 64.2 thousand hectares for 9 months of 2008. Thanks in large part to the business geography expansion in April 2008 the Administration of Bryansk region and “Miratorg” signed the investment agreement on transfer of 35 thousand hectares of agricultural lands to the latter. Grain production for the reporting period totaled to about 176 thousand tons, where wheat production was almost 70.5 thousand tons, up 2.5-fold in comparison with the corresponding period of 2007. The grain subsidiary revenue increased 2.5-fold, the profit grew by 14% (up to 4.12 million Euros), and EBITDA rate was up by 17%. The grain subsidiary of Agricultural Holdings “Miratorg” covers requirements of the feed plant of the Holding as well. At the end of the reporting period the feed plant, which was put into operation in July 2007, reached full feed production capacity (up to 20 thousand tons per month). The revenue of the feed plant totaled to more than 51 million Euros, and EBITDA rate exceeded 2 million Euros.

Feed and grain is produced for internal use of the Group (feeding at pig complexes), which affords to increase margin in pig breeding by significant decrease of production costs (about 70% of meat production costs are the costs for feed). The availability of own grain and feed base affords the Group to minimize the risks of price fluctuations and guarantee a stable consolidated profitability. The growth of production in these segments will favor the further increase of the Group’s profitability.

In the segment of supply logistics “Miratorg” is expanding the geography of its business as well. New means of transport were purchased for branches opened at the end of 2007 in Ekaterinburg and Rostov-on-Don; the truck fleet of Belgorod branch was enlarged as well. In total, about 50 units of equipment were acquired for the fleet of the holding, and as of today it numbers 348 vehicles. The supply turnover continues growth in the sector of storage logistics as well (there are two automated distribution centres in Moscow and Saint Petersburg in structure of Group of Companies “Miratorg” (both centres were opened in 2007)). For 9 months of 2008 the supply turnover amounted to 536 thousand tons. The EBITDA rate in the sector of transport and storage logistics exceeded 6.6 million Euros for the reporting period, and profitability of EBITDA grew more than 1.5-fold up to 44.5%.

For 9 months of 2008 the Group of Companies “Miratorg” managed to implement the plans on increase of profitability of transactions in the sector of food distribution. Total revenue of transactions on food distribution grew by 28% (to compare with the corresponding period of 2007) up to 495 million Euros, and net profit was up more than 1.5-fold to almost 7.85 million Euros. A significant sale growth was registered in many food categories of “Miratorg” range: in particular, the revenue from sale of pork increased by 10%, frozen vegetable (TM “Vitamin”) distribution was up by 88%, fish and seafood (TM “7 Morey”) sale increased by 83%, ready-to-cook product (TM Sadia) distribution grew by 15%.

Pursuant the strategy of regional development, the Group “Miratorg” continues growth of its share in Russian regions. “Branches opened in the forth quarter of 2007 in Ekaterinburg and Rostov-on-Don show a dynamic development. New subdivisions were opened in Chelyabinsk and Krasnodar in the reporting period as well”. “Miratorg” Saint Petersburg subsidiary showed a significant growth for 9 months of the current year, the sales volume increased by 34%. All branches entered into successful cooperation with majority of regional outlets, both with trade networks and traditional retailers.

Source: http://meatrussia.com

Turnover at Arrow Group, Ireland hits €397m

Wednesday December 03 2008
Waterford-based Arrow Group, the food processing business owned by brothers Peter and Michael Queally, saw turnover rise 5pc last year to €397m, with operating profit climbing to €19.6m from €18.5m.

Accounts just filed for the business show that the firm, which employs about 1,900 people, made an additional profit of about €840,000 from joint ventures and associate firms. It paid €56.3m in wages last year.

The results do not include the operations of Queally Dawn Meats (QDM), which has recently re-registered as an unlimited company.

The last set of publicly available accounts for QDS, dating to 2006, show that it made a profit of €4.6m that year on turnover of €912m. The revenue figure for QDM was up 7pc on 2005. Arrow Group exports products around the world, and its business mainly comprises pig slaughtering, meat processing and meat trading. It is also involved in the production of a range of food and beverage value-added products, as well as property development. The group had retained profits of more than €72m and shareholder funds of €85m at the end of 2007.

Dividends paid to minority shareholders of Arrow Group during 2007 were virtually unchanged on 2006, at €1.57m.

The company paid €26m to acquire tangible fixed assets during 2007, up from €18.8m in 2006. Apart from its main food business, Arrow Group has a smaller number of diverse subsidiaries. Among them are a company involved in all-weather football pitches; a 55pc stake in Glenwater, a plastic bottle manufacturing arm; and a water distribution company based in Barcelona. It also owns a 50pc stake in Kildare chocolate firm Lily O'Brien's.

Source: www.independent.ie

Moypark's Seagoe factory, Northern Ireland - to receive a £2.5m upgrade

MOYPARK's processing site at Seagoe is undergoing a major £2.5 million upgrade this month as part of the company's ongoing plant improvement programme.

The investment will bring the very latest in frying and fast-chilling equipment to the large 22,000 square metre site which is equivalent to over five full-size football pitches.
"This significant investment will deliver greater flexibility, coupl
ADVERTISEMENTed with 'best-available' energy-efficient technology," said Nigel Dunlop, Moy Park managing director. "Not only does this mean Moy Park will meet all known future environmental legislation, but will also remain competitive in the further processed sector and ensure still better service levels for customers."
Moypark's Dungannon factory deals with primary processing, but the Craigavon site deals with the second - or further processing - stage, adding sauces, breadcrumbs or coatings to the chicken meat.
"The company has always used the watchwords 'Being Best by Being Better' and this investment underpins that mission," added Mr Dunlop.
investment
"While the investment was signed off some time before we joined the Marfrig Group, this continuous plant improvement is very much the Marfrig way also. Only with the best plant can we expect to stay world class.
"The improvements are aimed at further streamlining production at Craigavon, which will mean improvements to servicing customers, with seven-day production and delivery throughout the year.
"Times might be tough, but we're ever mindful that in a sector as global as ours, there's always someone ready to take advantage if we don't stay ahead in every respect of our operation – having the best production facilities gives Moy Park its edge."
infrastructure
The external infrastructure work started in September, but the main refit site work will run from November through to mid-February 2009. The building and installation work has been awarded to a local company, with the new plant itself coming from specialist manufacturers in Denmark. The upgrade is supported by InvestNI.
Over 1,300 people work at Craigavon, out of the 3,000-plus employed by Moy Park across Northern Ireland – with 7,000 people employed in total across all Moy Park operations.

Source: www.moypark.com

Tuesday, 2 December 2008

Hain Pure Protein Corporation Announces the Expansion of its Poultry Operations in New York State

Expands Presence in Natural, Antibiotic-Free, Vegetarian-Fed Poultry with a New Kosher Line

Hain Pure Protein Corporation, a joint venture between The Hain Celestial Group, Inc., with a 50.1% controlling interest and Pegasus Capital Advisors, L.P., with a 49.9% minority interest, today announced plans to expand its Plainville, New York facility to meet the growing demand for natural, antibiotic-free, vegetarian-fed, kosher poultry products. The Company expects to furlough approximately 90 employees in the beginning of January while the plant is modified to accommodate the new kosher process. Production on the new kosher line is expected to begin in late February, 2009, and as a result of the conversion, it is currently anticipated that the total number of employees will increase. During this time, production of Plainville Farms® turkeys will move to Hain Pure Protein's New Oxford, Pennsylvania facility, which is expected to result in increased cost savings and efficiencies at the facility.

"Plainville Farms continues to be one of the leading suppliers of natural, antibiotic-free, vegetarian-fed turkeys in America, and we look forward to adding this production to our New Oxford Foods facility," said David Wiggins, President of Hain Pure Protein and formerly Chief Executive Officer of Empire Kosher Poultry, Inc. "As we said when we purchased Plainville Turkey Farm in August, 2007, we were excited to increase our specialty poultry product offerings, and we hoped to be able to expand our operations and product offerings within New York State. We see increasing demand for quality kosher poultry, and in order for Hain Pure Protein to meet this growing demand for natural, antibiotic-free, vegetarian-fed, kosher chicken and turkey products, the plant will be closed for production at the end of December with an expected reopening in approximately eight weeks with the facility adapted for new kosher production. The employees who have made our Plainville turkey operation the success it is today will be welcomed back at the commencement of kosher production."

Hain Pure Protein Corporation was formed in July, 2005 to establish FreeBird Chicken, which specializes in natural, organic and antibiotic-free chickens. In August, 2007 Hain Pure Protein acquired Plainville Turkey Farm, Inc., a leading supplier of natural and antibiotic-free whole turkeys and deli turkey products in the Northeast and Mid-Atlantic and in March, 2008, the Company expanded its turkey operations with a facility in New Oxford, Pennsylvania.

Source: www.hain-celestial.com

Zhongpin, China Expands Prepared Meat Capacity by 114%

Zhongpin, a leading meat and food processing company in the People's Republic of China, today announced that the Company has commenced production at its new prepared meat facility in Changge City, Henan Province and has increased annual production capacity for prepared meat products by 114%.

Zhongpin began construction of the new prepared meat facility in the first quarter of 2008 with an investment of approximately $13.2 million. The new facility is located at the Company's main production base, Zhongpin Industrial Park, and has annual prepared meat-production capacity of 28,800 metric tons. The new facility will increase Zhongpin's total annual prepared meat production capacity to 54,000 metric tons from the current 25,200 metric tons. The Company's prepared meat products include a variety of popular sausages and ham. Traditionally, prepared meat facilities have longer ramp-up periods compared to the frozen and chilled pork facilities. Zhongpin expects the new facility to achieve an over 80% utilization rate by the second quarter of 2009.

"Zhongpin's prepared meat products have enjoyed heightened brand awareness among consumers due to their superior taste and quality. We believe the additional production capacity will increase the contribution of prepared meat products to our product mix and have a positive impact on our profitability as these products have a higher gross margin compared to the other product categories," commented Mr. Xianfu Zhu, CEO of Zhongpin Inc. "The new facility is located in our industrial park and will be able to take complete advantage of our existing advanced logistics and distribution system. In addition, Henan and other provinces in greater Central China account for one third of China's population and we believe there is great demand for high quality prepared pork products from consumers and wholesale

Source: http://in.sys-con.com

Monday, 1 December 2008

Zhongpin Inc., China - Leases New Pork Facility in Hebei Province

China, Dec. 1, 2008 Zhongpin Inc., a leading meat and food processing company in the People's Republic of China, today announced that it has entered into an agreement with Chenguang Meat Products Factory to lease a pork production facility in Shenzhou city starting from early December of 2008.

The newly-leased facility is located in the city of Shenzhou, Hebei
Province, and has an annual chilled and frozen pork production capacity of
approximately 26,000 metric tons. Zhongpin plans to use about 70% of the
capacity for the production of chilled pork products and the remaining 30% for
frozen pork products. Hebei Province has a well developed transportation
system, which will facilitate Zhongpin's expansion plans to penetrate markets
in Northern China. In addition, Hebei is one of China's major hog farming
regions and was ranked the fifth largest in terms of hog livestock in 2007.
The leased facility has the largest hog slaughtering capacity in Shenzhou and
is equipped with world-class equipment utilizing advanced processing
technology. The addition of this facility increases Zhongpin's chilled and
frozen pork production capacity by 7%, bringing total production capacity
to 417,560 metric tons annually.

"We are happy to report the increased expansion of our production capacity
with the addition of the leased facility in Shenzhou. We believe this is a
significant step in our efforts to capture market share in Northern China,"
commented Mr. Xianfu Zhu, CEO of Zhongpin Inc. "We have been targeting the
high-end pork product markets in Tianjin, Beijing, Hebei Province and other
areas in Northern China which have experienced rapid growth in their consumer
bases in recent years. With the help of a dedicated production base in the
region, we expect to effectively tap these markets, acquire new market share,
and further promote Zhongpin's brand image."

Source: www.earthtimes.org

Kayarlar, Turkey meat company looks for ways to expand

Kayarlar Et A.Ş., the largest meat trading and packing enterprise in Turkey, is open to offers for joint ventures and willing to take on foreign partners provided that such cooperation will contribute to its expansion and fall in line with its prospective partners' interests, the company's top executive has said.

He also revealed that the company will launch an initial public offering (IPO) in 2010 to become a publicly traded company on the İstanbul Stock Exchange (İMKB).

Let's Talk Business spoke with Haluk Kayar, CEO and general manager of Kayarlar Et, to find out how the business is faring in Turkey and ask about the challenges the industry is facing today. Kayar, who represents the fourth generation in the century-old family business, says Kayarlar will widen its lead in the industry by investing in advanced technologies in its processing plants and developing a customer-oriented business strategy.

With overall meat consumption still in low figures for the average Turkish family, meat traders and packers are taking up the challenge of promoting this essential nutrient to consumers by introducing innovative products in a hope that Turks will consume more meat products. "Kayarlar is adopting a customer-tailored approach to encourage meat consumption according to shifting demands in the market" Kayar explained.

Kayarlar made the prestigious "Top 500 Industrial Enterprises" list issued by the İstanbul Chamber of Industry (İSO) for the first time in 2006 with YTL 143 million in revenue. It was ranked at 295 on the list that year. "We could have made the list earlier," Kayar underlined, "but the İSO was then only qualifying İstanbul-based companies. It changed its criteria to include all regions in 2006."

In fact, the company jumped to 201st place in 2007 with sales revenue reaching YTL 234 million. "We are expecting to land somewhere within the double digits on the list this year," Kayar anticipated, adding, "We project over YTL 300 million in revenue by the end of this year." The track record for the last 10 months shows the company will easily reach its target revenue by the end of the year. It grew impressively by 30 percent in the first six months of 2008, with an average profit margin of almost 10 percent.

Kayarlar came into existence as a small butcher shop opened by Ali Kayar, Haluk Kayar's great-grandfather, in Zonguldak in 1910. The small shop flourished after it landed a military contract for supplying rationed meat to Turkish soldiers during World War I. The family then moved to Adapazarı and continued its involvement in the cattle business by setting up a cooperative in 1955. "I remember me and my grandfather used to go to the cattle-trading market in İstanbul to get a feeling for the market when I was 10 years old," Kayar recalled.

Though Kayar had good grades, he dropped out of school and decided to pursue a business career in cattle trading. "My mother was staunchly against my decision," he noted, adding: "But conditions were not good. The business was in distress, and I needed to help out my father." He has no regrets today, however, about the decision he made in 12th grade. "I can arm wrestle with anyone in this business," he says confidently, "Even if that person has a Harvard degree." He stresses, "I know how to bargain and convince partners in negotiations to pursue business deals."

But Kayar does not hide the fact that he has changed his opinion on education, as he was insistent that his daughter, Zühal Kayar, get an education in the US. Now, having gone to Texas A&M University, she runs Kayarlar's public relations and marketing department and helps out her father. When asked if he would have allowed his daughter to drop out of school to get into the business, just like he did, Kayar said, "Absolutely not." In fact, the Kayar family has decided to prioritize education for its fifth generation, which they believe will take the company to the next level.

State-of-the-art facilities

Kayarlar has a fully integrated 6,000-square-meter production facility in Bursa. The Bursa plant accounts 40 percent of Kayarlar's production and has a daily capacity of 670 tons. "We can monitor the conditions in our plants with satellite-guided technology," Kayar said.

"We are building the largest meat-processing plant in Turkey with the latest technology available," Kayar boasts, referring to their construction of giant 34,000-square-meter integrated and fully automated plant in Çayırova in the northwestern town Gebze. "Once it becomes fully operational, the plant will process almost 2,000 tons of red meat per month," Kayar said. The company plans to spend over 30 million euros on the project and, except for a European Investment Bank loan, it is financing it with its own resources.

"The Çayırova plant is a state-of-the-art facility," Kayar explained. The plant, scheduled to open in 2009, will be furnished with the latest processing and packing technology and equipped with new-model machinery imported from abroad. Designed by a German firm, the plant will produce packaged meat products minimal manual intervention.

"Health is of paramount importance to us, as well as to the industry," Kayar emphasized, noting that consumers are very sensitive to hygiene. "Our sales can plummet easily with bad news," he said, recalling the mad cow disease scare in the UK in 1990. He said his company doesn't take chances on the safety and security of its products and that, for this reason, it always invests in the most advanced technology available. "Our products and processing facilities conform to and even exceed European Union standards," Kayar added.

Kayarlar also uses unique technology in its refrigeration systems. Though it is costly, the company has decided to change its freezing technology from ammonia-based refrigerants to USP-grade propylene glycol. The latter is generally recognized as safe for use in foods when used in accordance with manufacturing practices recommended by the US Food and Drug Administration (FDA). "We are one of the first meat packing companies to have done this in Europe," Kayar said.

Kayar concedes that the global financial crisis will have an impact on consumer purchases, saying, "Psychological factors will play into customer's choices eventually." But he added that he wasn't too worried about the situation, pointing out, "Meat and poultry products are the basic food necessities on the kitchen table." "As far as the company's finances are concerned, we are in good shape," Kayar added.

Expanding into retail business

In recent years the company's management decided to expand into the retail market and diversify the risks associated with the industry's cycles. "That is why we acquired Namet in 2005," said Kayar, who pushed for the takeover, thinking that the group could capitalize on booming demand in the retail market. Namet, a household name for meat products in Turkey, paved the way for the Kayarlar group to enter the retail business. For a while internal company discussions entertained the idea of introducing a new brand rather than buying into an existing one. The decision to create a new brand, however, was quickly rejected. "It was much better to promote and expand an already known brand than to put a new one out there," Kayar argued. The move turned out to be a wise one, as Namet's production capacity has doubled with surging sales following the takeover.

With a production capacity of 50,000 tons a day, Kayarlar has about 55 percent of the domestic market and, as such, is the largest meat wholesaler in the country. It provides red meat products to hotel and restaurant chains and supplies famous brand producers, such as Pınar, Aytaç, Polonez, Maret and Coşkun. It is also active in large food retailer chains, such as Carrefour, Metro, Migros and Tansaş. The company sells around 45,000 tons of meat a year.

Annual per capita meat consumption is 11 kilograms in Turkey, official statistics show. The number is below the European Union average, which is around 50 kilograms, and far below the US average of 90 kilograms. There are signs, however, that meat consumption in the country is increasing along with the rising purchasing power of Turkish consumers. In 2007 red meat production increased by 31.54 percent over 2006 and reached 576,841 tons. The bulk of this increase was seen in beef, which rose by 74.96 percent. Lamb production also increased by 20.47 percent in the same period.

Believing that traditional ways of marketing meat are no longer valid in today's consumer-conscious market, Kayarlar is also changing its product portfolio to reflect its customers' changing habits. "We see more and more people opting for ready-to-serve frozen meals and many city residents and working families choosing small-portion meat products that can be consumed in one course," he said. The company has developed close to 150 different meat products to address different customer needs.

Asked how the company develops new product lines, Kayar said they continuously update their product portfolio based on customer surveys and feedback they receive from their clients. "We especially value the results of 'taste panel' discussions, as they give a clearer picture of what consumers demand from us," Kayar explained. He also noted that major food retailers revise their wholesale orders based on these customer surveys. "Obviously, nobody wants to keep overhead costs high by keeping low-demand products in the frozen sections of supermarkets," he said. The company discontinues such products from its processing lines, he added.

7 million euro project in Konya

On the supply side, Kayarlar maintains two large breeding farms in Adapazarı that house around 5,000 cattle per year. It also relies on local farmers in the region. The company's strategy is to have processing plants near the farms, as most damage and bruising occurs while transporting the animals. The company is planning to build a 28,000-square-meter plant in Konya in central Turkey. The project, slated for next year, will cost around 7 million euros and aims to utilize the province's meat resources, which account for 30 percent of Turkey's total production.

Turkey currently does not allow imported meat into the country out of concern for safety and health issues. The ban, instituted eight years ago as a result of the mad cow disease scare, is still in effect. When asked what will happen if the government lifts the ban, Kayar says he is not afraid of competition -- be it domestic or foreign. The company is also very sensitive on the "halal" issue (processing meet in accordance with the requirements of Islamic law) and follows strict guidelines, Kayar emphasized. He said his company has a certificate from the authorities to verify that their processing complies with Islamic requirements.

Since meat production relies on refrigerated trucks for transportation and frozen storage in the supply chain, Kayarlar has invested heavily in logistics and infrastructure. "We established regional hubs and sales offices in the Black Sea, Aegean and Mediterranean regions and Ankara," Kayar said, stressing that the refrigeration link must not be broken until it reaches the customer. With over 60 refrigerated trucks in its fleet, the company meets around 70 percent of the meat needs of major hotels in the Mediterranean and Aegean regions.

"We are open to offers for joint ventures and willing to take on foreign partners if it serves the company's growth," Kayar said. The company has received attention from other groups in the past, but company executives have so far declined all offers. "We are very selective," he stressed.

Kayar said Kayarlar will launch an initial public offering in 2010 provided that conditions are ripe. He also said the company will soon reveal revolutionary packaging changes in meat marketing, but declined to provide specifics. "In the middle of 2009, we will be presenting a very different product portfolio to our customers," he explained, adding, "We have already invested 5 million euros in the project."

Bell Holding Ltd., Switzerland takes over German ham specialist Abraham Schinken GmbH & Co. KG, Germany

The Bell Group is acquiring a majority interest in Abraham, the German producer of ham specialities. With a turnover of approximately 190 million euros and over 650 employees, Abraham is one of Europe’s major producers of cured hams and is the market leader in Germany. The acquisition is a further step in the Bell Group’s strategy of internationalisation.

As of 01.01.2009 Bell Holding Ltd. will acquire a majority interest in the Abraham Group domiciled in Seevetal near Hamburg. Jürgen Abraham will continue as chairman of Abraham GmbH and will sit on the supervisory board of Bell Deutschland GmbH. The parties have agreed to maintain confidentiality in respect of the purchase terms. As of 2009 Abraham GmbH will be consolidated in the Bell accounts. The acquisition is subject to approval by the German anti-trust authority.

For the Abraham family, Bell is the ideal partner for their strategy of growth and ongoing development within Europe. For Bell, Abraham ideally supplements its previous acquisitions in the European charcuterie market.

Abraham is the biggest European producer of smoked and air-cured ham in Germany. Over 650 employees generate annual sales of roughly 190 million euros, some 20% of which outside of Germany. Approximately 24’000 tons of regional ham specialities are produced annually at six facilities in Germany, Spain and Belgium. Specialities include Northern German Cottage Ham, Black Forest Ham, Ham from the Ardennes and Serrano Ham from Spain.

Following the takeover of the Polette Group in France and of majority interests in Zimbo and Abraham in Germany, Bell has achieved the most important goals of its international strategy and is securely anchored within Europe. These companies ideally supplement each other in respect of product ranges and regional coverage.

Source: www.Bell.ch

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