Frozen potato products major McCain Foods has abandoned a plan to set up its first manufacturing plant in Germany.
The privately-owned, Canada-headquartered French fries maker for the retail and foodservice channels, has cited the challenging market conditions, including inflationary pressures, as the reasons behind its decision.
Toronto-based McCain Foods said it had been “assessing the opportunity” in Germany for an inaugural factory in Mehrum, Lower Saxony, for the past two years in what would have been a “large scale and sustainable frozen potato production” facility, a spokesperson confirmed with Just Food.
“Following a comprehensive review of the project's competitiveness and economic viability, the company has decided not to pursue the planned investment in its current form at this time,” the spokesperson explained.
“This decision reflects current market conditions in Europe, including a significant increase in project costs driven by inflation, excess capacity in processed potato products, and softer demand across key markets.”
McCain Foods currently supplies the German market but as a family-owned and private business – with global revenues of more than C$16bn (US$9.9bn) - declined to disclose the sales it generates in the country from retail, out-of-home and quick-service restaurants.
The company has manufacturing plants in other parts of Europe, such as Belgium, France, the Netherlands and Poland, and McCain Foods did not rule out future investment opportunities in Germany.
“While the current project will not move forward, the company continues to see Germany as a key market for potato processing and will evaluate potential alternative investment over the coming months,” the spokesperson said.
Elsewhere in its global network, McCain Foods is reportedly planning to end production at one of its two sites in New Zealand, with the slated closure of the Hastings facility earmarked for early next year.
Late in 2025, the company announced the sale of its vegetable manufacturing operations in South Africa after earlier revealing the acquisition of US-based peer Penobscot McCrum.
