Turnover in 2016 was €4.2bn compared to €3.8bn in 2015, a hike of 10.8% - the highest turnover ever said the group; it added Danish Agro, which operates a number of agro-industrial companies in Denmark and abroad, is now the sixth biggest agribusiness group in Europe.
Danish Agro businesses include feedstuff mixes, ingredients and vitamin mixes, fertilizer, crop protection, seed and energy, plus the purchase of crops from farmers. The group is also a distributor of a number of farm machinery brands, and runs a chain of hobby and leisure retail outlets. Owned by 10,500 Danish farmers, the cooperative has 4,500 employees.
In terms of the role its feed activities made to Danish Agro’s overall earnings, group CEO, Christian Junker, told FeedNavigator:
“Danish Agro group consists of about 100 subsidiaries and the group is active in many different fields of business all related to farming. We produce about 3m tons of feed each year, and, as almost all products in our broad portfolio are interlinked with other product areas, it would not make sense to talk about an isolated feed result.
“In general, we can say that we are very satisfied with our annual result, and it has been made possible by great performances across all business areas in our group.”
Premix and vitamin activities under the Vilomix umbrella performed well, reported Danish Agro in announcing its results at the end of last month. It said this good performance was due, in part, to acquisitions in Poland and Norway but also because of the start-up of feed activities in Asia.
The group said it made significant progress in terms of its structure and organization last year.
The Swedish competition authorities approved Danish Agro’s acquisition of Kalmar Lantmän in February 2016, which the group said enabled its subsidiary, Swedish Agro AB, to become the third biggest agribusiness company in Sweden.
Beyond Sweden, it reported that its activities in Denmark, Finland and the Baltics yielded impressive results; it said it has invested considerably in improved logistics and warehouse facilities in several countries.
Challenges in Germany
However, the Danish group noted challenges in the German agribusiness market. It said Ceravis AG, the feed crop and fertilizer business the group took over in February 2015, has struggled to achieve respectable results, with the problems therein larger than expected. Consequently, that business made a loss in 2016.
Junker said the management and employees at Ceravis AG, though, are focusing on recovery:
“Throughout the years we have been part of numerous acquisitions and mergers but we have to admit that we have been surprised about the amount of challenges in Ceravis AG.
“We have a clear plan for how to turn things around in the company and we know what to do.
"We are in the process of creating a leaner organization, closing a number of branches and streamlining production facilities. It is a big task and we expect to be able to speed up this process in 2017, compared to 2016.”
However, in general, the group was “very satisfied” with its international feed operations which the CEO said were characterized by “high quality products, deep insight knowledge and close collaboration with our customers.”
The road ahead
The CEO stressed that 2016 was a difficult year for many farmers at home and abroad, and Danish Agro had to react to an industry under pressure.
Does Junker see bumps on the road for the year ahead for agribusiness, and for feed? “In the markets we operate in, the structural development towards fewer and bigger farms will continue in 2017.
“This means that we constantly need to optimise our organisational setup around our feed so we produce high quality feed at competitive prices while having the right knowledge level to support and advise modern professional farmers. This will be a key focus in 2017," said the CEO.
The group said it expects turnover of around €4.4bn in 2017.