Danish Crown has made the strategic decision to discontinue the sale of retail-packed fresh meat in Germany. This move forms part of the pork heavyweight’s broader efforts to enhance profitability within the challenging food manufacturing sector.
Consequently, the Oldenburg Convenience division in north-west Germany will cease operations by the end of February.
For more than a decade, Danish Crown’s Oldenburg Convenience division has played a critical role in packaging meat for the German retail market.
The division has operated out of both Danish Crown’s bacon and deli factory in Oldenburg and an abattoir located further south in Essen.
Per Fischer Larsen, Danish Crown’s senior vice-president stated, “The competition in the German market is extremely tough and to make money selling fresh meat to German retailers costs must be minimal and volumes high.”
He further emphasized, “We’ve realised that our setup is not competitive, so we will produce our last fresh products for the German retailers at the end of February.”
Approximately 160 employees engaged in producing retail-packaged meat will be affected by this decision. Nevertheless, the company has assured that most of these workers will likely be offered “alternative positions” within either the Oldenburg bacon and deli factory or the Essen abattoir, which remains operational.
Rasmus Aadal, another senior vice-president at Danish Crown stated, “It is always unfortunate to close down operations, but in this case, we are fortunate to have a good outlook for retaining most of the employees.”
“Over the coming weeks, we will meet with employee representatives and their unions to determine the best possible solutions, which each employee will then individually consider.”
In a previous announcement made in October, the company outlined plans to eliminate around 500 jobs. This adjustment aims to save DKr500m ($73.2m) annually.
The CEO classified the situation as a “crisis,” attributing it to declining slaughter pig numbers and escalating operational expenses that have adversely affected competitiveness in the food manufacturing industry.
Danish Crown also disclosed plans to close its slaughterhouse in Ringsted last April, a decision that took effect in mid-September.
This closure aims to release around DKr250m for investment over the next three years, reinforcing the company’s commitment to staying competitive in an unpredictable market.
