Nordzucker may abandon Poland

2010-07-06

The German sugar concern Nordzucker is considering withdrawing from the Polish market, Rzeczpospolita reports. The company is believed to have offered one of its market rivals to sell its plants in Chelmza and Opalenica. The transaction is thought to be worth €100m. The Polish management of the German concern has, however denied these reports.
Nordzucker has the smallest production quota of any of the sugar producers in Poland: 132,000 tonnes, which is a 10% market share. In 2009, the third largest sugar producer in Europe, earned sales revenues of €1.8bn but made a net loss of €10m. Because of the disappointing results the company is planning to restructure in order to reduce its costs by €67m over four years.
In addition, the Institute of Agricultural Economics and the Food Industry (IERiGZ) estimates that there will be a 9% reduction in sugar production in Poland in 2010 in comparison with 2009. However, Krajowa Spolka Cukrowa (KSC), the largest sugar producer in Poland, hopes to make a net profit of PLN 184m (€46m), whereas its revenues should come to PLN 1.5bn (€361.9m). There has been market speculation that KSC might buy the Nordzucker plants.