Danish Crown’s new strategy for the next five years includes establishing its own processing plant in China.
Announcing plans to invest around DKK 300 million in a processing and retail product plant, located in Shanghai, the company said the production for that unit “will be based on Danish raw material”.
“Today, Danish Crown is already a big and successful exporter of fresh pork and the so-called ‘China goods’ of trotters, ears, tails, etc. which the Chinese love, appreciate and pay well for,” said Danish Crown.
The company added that it believes there is much more to be achieved in the Chinese market.
“The sale of meat to Chinese consumers continues to a large extent to be from so-called wet-markets where the pig is sold cut into relatively large pieces, which the consumer can see and touch,” said Danish Crown, “However, China’s consumer pattern is rapidly changing.
“Consumption is moving into foodservice or restaurants similar to the USA or Europe. We also see a vast increase of e-Commerce where groceries are bought and delivered at home while, in addition, consumers there have also started buying retail packed products, just as they do in Denmark.
“It is therefore evident that we should try to capitalise on (these developments) by our own production,” said Danish Crown’s Group CEO, Jais Valeur.
“Is this a chance we are taking? Yes, it is, but this is one of the chances we should take as a big company and try to see if we can get closer to the market, closer to consumers and further up in the value chain in China, rather than just being a raw material supplier.”