March 25, 2011
 

Danish Crown approves planning of Danish slaughterhouse

The initial planning of a new cattle slaughterhouse in Denmark was approved by Danish Crown's Board of Directors yesterday (Mar 24).

This is the first step towards establishing a state-of-the-art slaughterhouse technology for cattle and it reflects the fact that it makes commercial sense to invest in Danish jobs in the long term.

"We currently enjoy a leading position in the beef market, and in light of developments in recent years, it is obviously a good idea to consider establishing an up-to-date and modern production facility. We have been able to follow developments in costs at the world's most advanced pig slaughterhouse, and there is every reason to draw on the group's experiences here," said Lorenz Hansen, Managing Director of DC Beef.

Establishing a modern cattle slaughterhouse will inevitably have implications for the cattle slaughterhouses in Tønder and Holstebro and the deboning departments in Skjern and Fårvang.

"The current situation understandably creates uncertainty among employees, but we have decided to be open about the process, and we will do what we can to keep our employees regularly informed. The location of a new cattle slaughterhouse is still an open question with many different factors to be taken into account, but during the analysis phase we are looking at most of Jutland," said Lorenz Hansen.

One of the most important considerations in the final decision will be whether productivity and the costs level can guarantee a competitive basis for the company.

Last year's extraordinarily good results in DC Beef that have made it relevant to look at the possibility of optimising cattle slaughterhouse capacity. The results made it possible to allocate resources so that a new facility will not be an excessive burden to members. It also means that a new slaughterhouse will produce positive financial results very quickly.

Building a new slaughterhouse at an estimated cost of DKK500 million (US$95 million) breaks with developments in recent years which have seen jobs being transferred, but it does not mark a new strategic direction for the group.

"The two things are very closely related. Today, the foreign workplaces in the Danish Crown group are a precondition for the Danish workplaces. Likewise, establishing modern and streamlined slaughterhouse capacity in Denmark is a precondition for Danish Crown to retain its leading position both in Denmark and abroad," said Danish Crown's CEO, Kjeld Johannesen.