Germany-based meat processor Toennies Group is forming a joint venture in China with the Dekon Group which will involve the construction of a slaughterhouse and cutting facility to process pigs.
Family-owned Toennies said the total investment in the project with Dekon, a subsidiary of Chinese conglomerate West Hope Group, amounts to EUR500m (US$545.7m) of which EUR150m will be allocated to the new abattoir and cutting centre in the south-western province of Sichuan. It will have an initial capacity to process two million pigs and that will be extended to six million over time.
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Construction is expected to start next year with production commencing 18 months later.
Andres Ruff, the chief executive of Toennies, said: “We are proud to be starting a new chapter in our company history together with our partner, the Dekon Group. With our competence in the slaughter and butchering of pigs and our knowledge of the pre-requisites, safety and hygiene in food production, we can further consolidate pork production for the Chinese market.”
Toennies is embarking on the project amid an outbreak of African Swine Fever in China that has devastated hog numbers and led to increased imports of pork from overseas. The disease has since spread to other countries in Asia and beyond. It was something acknowledged by Ruff who said “African Swine Fever has culled stocks in parts of the country”.
Clemens Toennies, the managing partner of Toennies Holding, said: “The demand for pork in China and many other Asian countries is great and will continue to grow in the coming decades. This joint venture is the next step in our internationalisation. We are bringing our knowledge of food production based on German standards to the world and strengthening the quality and safety of the supply in China.”
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By GlobalDataWang Degen, the CEO of Dekon Group, added that the plant in Sichuan will be the first to be constructed in compliance with the European standard for pork products.
Toennies generates annual sales of EUR6.65bn from its various divisions, one of which covers its international markets. The company, which has 19 plants in Germany, has a further ten overseas, with three in the UK, three in Poland, two in Denmark and one each in France and Spain.
