Dutch Royal Agrifirm Group, one of the largest fodder manufacturers in Europe, acquired 35 percent of the local company Sto Posto and now plans to invest EUR 30 million in it over the next three years. A specialized company within Agrifirm, Nuscience, simultaneously became a majority owner of the local manufacturer of vitamin and mineral mixtures for animal feeding, the Novi Mix company, acquiring a 51-stake in the company.
President of Agrifirm Group Ton Loman explained that they represent cooperative which gather 18,000 Dutch farmers generated annual net revenues of about EUR 2.4 billlion.
In a talk with eKapija, the president of the Agrifirm Group explains how the business will be affected by the aflatoxin affair and if this cooperation will help our small farmers or contribute to the growth of production and meat, milk and egg exports.
eKapija: Serbia has twice as much arable land compared to the Netherlands, but in the same time it has four times less number of head of cattle. Have you chosen Serbia for investments because you believe that the situation can change?
- We chose to invest in Serbia for its natural resources and great potential for future agricultural development. We already have strong market positions in Hungary, Poland and Ukraine, and perceive entering Serbian market as an important step towards our international growth in animal feed.
eKapija: What is the business model you are going to apply in our country based on?
- The strategy of Agrifirm is focused on innovation. We develop and produce high quality feeding concepts, combined with customized consultancy. In this way we support farmers to achieve improved animal performances as growth, milk/egg production and feed conversion. This brings higher profit to farmers and can facilitate economic development of agricultural sector of the country.
eKapija: The value of the acquisition remains a business secret. However, you said at the agreement signing ceremony that you intended to invest EUR 30 million over the next three years. Where do you plan to invest this money?
- Agrifirm and Nuscience will invest with our knowhow about feed, feeding concepts and farm consultancy to help the client farmers of Sto posto and NoviMix to realize beter animal performance. This will help to let the business of the farmers grow and will create further investments in Serbian agriculture.
eKapija: Where do you see Serbia in relation to the region, and of course, to the Netherlands and Europe?
- The Netherlands is the second largest exporter of agricultural products in the world, and we believe that Serbia can become a competitive producer and exporter as well. With a production capacity of about 25.000 ton of premixes we have a lot of export potential of these products as well.
eKapija: What results do you expect in terms of the recovery of devastated livestock in Serbia, and when?
- We hope that our investments will swiftly upgrade the Serbian livestock production in the next 5 to 6 years, which will result in your country becoming more internationally competitive in this field.
eKapija: What are the chances for Serbia to become an exporter of meat, rather than an importer?
- Serbia has all the prerequisites - resources, tradition and workforce, to become major agricultural producer, and an exporter as well. In order to achieve this, it is necessary to invest in farm management and technical knowledge. We have the highest know-how, invest EUR 9mln per year in pure R&D, have decades of world leading experience and resources which we are willing to make available through StoPosto also to your agricultural development.
eKapija: When it comes to the production of animal feed, can you tell us how the problem that Serbia had with infection of corn with aflatoxin will affect the business of the companies you are taking over?
- As concerning to mycotoxins as aflatoxin it is very important to work and to produce feeds which never exceeds the maximum levels that are allowed by legislation. For all countries Agrifirm is producing and exporting we work in this way. With intensive monitoring and testing we make sure to produce high quality, save feeds.