Danish Crown to Cease Retail Fresh Meat Sales in Germany
Danish Crown, a leading pork producer, has announced plans to end its sales of retail-packaged fresh meat in Germany as part of a broader strategy to enhance profitability. The move will result in the closure of its Oldenburg Convenience division in north-west Germany by the end of February.
Operational Changes in Germany
For over a decade, the Oldenburg Convenience division has been responsible for packaging fresh meat for German retailers. This work has been conducted at Danish Crown’s bacon and deli factory in Oldenburg and at an abattoir located in Essen, further south. However, the company has decided to cease these operations, citing the highly competitive nature of the German market.
Per Fischer Larsen, Danish Crown’s senior vice-president explained the decision: “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. We’ve realized that our setup is not competitive, so we will produce our last fresh products for German retailers at the end of February.”
Impact on Employees
The winding down of operations will impact approximately 160 employees involved in the production of retail-packaged meat. Most of these staff members are expected to be offered alternative roles within Danish Crown, either at the Oldenburg bacon and deli factory or at the Essen abattoir, which will remain operational.
Senior vice-president Rasmus Aadal addressed the workforce’s future: “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 find the best possible solutions, which each employee will then individually consider.”
Broader Challenges and Strategic Shifts
The decision to exit the retail fresh meat market in Germany follows broader challenges faced by Danish Crown. In October, the company announced plans to cut approximately 500 jobs as part of an effort to save DKr500 million ($73.2 million) annually. CEO Jais Valeur described the situation as a “crisis”, citing a decline in slaughter pig numbers and escalating operational costs that have eroded competitiveness.
This latest move is not the Danish Crown’s first significant operational shift. Last April, the company announced the closure of its slaughterhouse in Ringsted, a decision that was implemented in mid-September. The closure aimed to free up around DKr250 million for investments over the next three years.
Looking Ahead
While the decision to exit Germany’s retail fresh meat market marks a major shift for Danish Crown, the company is optimistic about retaining its workforce and redirecting resources to more profitable ventures. The coming weeks will be critical as discussions with employee representatives and unions unfold to ensure a smooth transition for affected staff.