Danish Crown to close two facilities

by Editor fleischwirtschaft.com
Thursday, January 23, 2014

Danish Crown announced plans to close two production facilities in Faaborg, Denmark, and other initiatives as part of a restructuring of the company's pork-processing operations.

The company's board of directors recommended ending production of ready meals at Tulip Faaborg and closing the deboning department at Danish Crown Faaborg. The company said the current production set-up was not competitive. The two closures will affect approximately 470 workers, according to the company.

In addition to the closures, the Danish Crown board is recommending negotiations with workers and other stakeholders at slaughterhouses in Skaerbaek and Bornholm with the goal of achieving a more sustainable cost structure. For Danish Crown, this means reducing production by approximately 20,000 pigs per week. The company said it would achieve its goal by reducing the number of pigs slaughtered on the evening shift. Approximately 350 employees will be affected by the capacity adjustments.

Danish Crown's restructuring initiatives will include adjusting capacity at the group's slaughterhouses. Pork production in Denmark has fallen by more than 20% over the past five years, according to the company.

Danish Crown in Faaborg debones hams and produces raw ingredients for sliced back bacon and semi-finished ham products (MetaPress hams). Danish Crown is establishing a job bank to help the employees who will be impacted by the closure. The company plans to close the facility by early 2016, and decide whether to move production to Poland or Germany.

Tulip Faaborg produces refrigerated and frozen ready meals. Danish Crown is gradually transferring production from the facility and plans to close the plant in September. Approximately 70% of production in Tulip Faaborg is being transferred to Tulip in Aalborg, where the company is investing approximately DKK30 mill. The remaining production is being distributed between the other facilities. The factory closure at Tulip Faaborg affects 63 employees.
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