February 5, 2008

Gruppe Lohmann to set up poultry plant in Russia
 

Gruppe Lohmann & Co., Germany's largest poultry meat producer, has opened a division in Russia that will produce poultry products in Kaliningrad Region.

The company will build a poultry meat-processing plant in Guryev District with an initial investment of RUB 288.9 million (US$12 million). The plant will produce 15,000 tonnes of frozen chicken meat and other poultry food products per year.

Other meats may be processed there as well, and those products will be sold in both Russia and Europe. However, the German company will not provide produce for the local market; all of the products will instead be shipped to Germany.

Last week, Kaliningrad's local administration have also announced on its website that Wiesenhof-Kaliningrad-International, Lohmann's division in Russia, would become a resident of the region's special economic zone.

It has been noted that residence in the special economic zone will give the company benefits on meat import duties. That will enable the company to ship meat into Russia for processing before shipping the end product to Germany, as processing costs are lower in Russia than in Germany.

Observers also note that the scale of the German company's operations is modest and could be considered as a test project.