AB Akola Group is investing €9.5m in a seed factory in Latvia, with an expected operational launch by mid-2025. The factory, being constructed by the subsidiary SIA Dotnuva Seeds on its own land in Iecava, will have a maximum annual capacity of around 30 thousand tonnes of cereal and leguminous plants seeds.
“In the design of the factory, we plan to utilize a promising new seed preparation technology that enhances sustainability in seed production. We have observed this technology in action at another facility and are excited about its potential. By incorporating this innovative technology into our infrastructure, we anticipate a return on investment within seven years,” states Mažvydas Šileika, the chief financial officer of AB Akola Group.
The future factory, spanning 4,550 square meters, will house a production unit, warehouse, and a two-story administrative building complete with a laboratory, office workstations, and technical facilities. Additionally, the facility will facilitate quicker access for Latvian and Estonian farmers, thereby shortening the logistics chain.
Jonas Bakšys, a member of the management board of AB Akola Group and CEO of SIA Dotnuva Seeds, expresses, “By collaborating with 30 breeders across various European countries, we aim to introduce new seed varieties suitable for each region’s climate. This increased diversity of supply will greatly benefit farmers. We are also exploring the potential integration of Swedish seed preparation technologies into our production process.”
Last year, two seed production companies were established in Lithuania and Latvia to bolster certified seed production. The seed factory in Dotnuva, Lithuania, currently produces approximately 27 thousand tons of ‘Dotnuva Seeds’ branded seeds annually. These seeds are distributed by AB Linas Agro, another subsidiary of AB Akola Group, led by Jonas Bakšys.
“The demand for certified seeds is on the rise as farmers recognize the value they bring. We are now selling more seeds than we can produce. By the time the Latvian factory is operational, we plan to produce approximately 20 thousand tonnes of cereal and legume seeds annually, with a possibility of expanding the capacity to 30 thousand tonnes if market demand continues to grow,” adds Bakšys.
In the first half of the 2023/2024 financial year, the company witnessed a nearly 14% increase in seed sales compared to the previous year, underlining the growing market demand for high-quality, certified seeds.
