Vion Food to close German meat plant and divest beef slaughterhouse and pre-packing facilities

17 Jan 2024 --- Vion Food, an international player in both meat and plant-based alternatives, is implementing business changes in Germany, which involve cutbacks and closures in its German operations.

The company has announced a comprehensive package of measures for 2024, focusing on sustainability. Central to these changes is the proposed sale of key facilities. 

Vion plans to divest the beef slaughterhouse and pre-packing facility in Altenburg, along with the ham specialist Ahlener Fleischhandel, to Tönnies Group. Additionally, the pig slaughterhouse in Perleberg is set to be sold to Uhlen GmbH. 

Inge Moussaif-Burgmans tells Food Ingredients First: “We’re making decisions about selling or closing some locations as part of our plan to improve the performance of Vion Food in total. We’re streamlining our operations to be more efficient and flexible, concentrating on sustainable development in the whole chain.”

“With the sale of Ahlener, Altenburg and Perleberg, we therefore want to secure the future operations of these facilities in a volatile German market. Closing Emstek is the necessary step after all our efforts to find a prospective buyer and save the location have unfortunately been unfruitful.”

Navigating the challenges
The broader European meat industry, with Germany at its core, faces intense global competition from the US, South America, and China. 

The outbreak of African swine fever (ASF) has exacerbated challenges, leading to lost export opportunities and heightened pressure on German meat companies. Despite EU cases of ASF in pigs falling recently compared to the previous year, warnings are issued by the European Food Safety Authority that farmers must remain vigilant.

“In response, the industry is focusing more on the domestic market, moving toward self-sufficiency. These changes, together with political and regulatory challenges in the agricultural sector, inflation, changing consumer behavior and other factors, resulted in declining herd sizes and high animal prices,” Moussaif-Burgmans explains.

“The overcapacities in the region, together with declining livestock, make this step inevitable. This package of measures is one of the milestones on this journey.”

Shifting to sustainability
Vion Food is building sustainable supply chains that connect farmers, customers and partners.The pig sector in Germany is undergoing a strategic restructuring, particularly in the northern region. This is occurring in a market that emphasizes affordability, yet the sector is also striving for more sustainable practices, which inherently command higher prices. 

“We must balance our economic progress with the well-being of our employees, which needs investments and environmental responsibility,” says Moussaif-Burgmans.

The beef sector mirrors this trend, facing annual declines in production. 

Research on German households showed that many consumers are intentionally reducing their meat consumption due to a high awareness of environmental issues and a preference for fair trade food.

A survey across Europe from last year reveals that 51% of individuals in the region are currently taking active steps to reduce their meat consumption. This marks an 11% increase from the figures reported in 2021.

By Sichong Wang