ADM to acquire German rapeseed plant

By Jess Halliday

- Last updated on GMT

Archer Daniels Midland has signed an agreement to acquire a rapeseed crushing plant in southern Germany – its first in Central and Eastern Europe region.

Rapeseed is a member of the brassicaceae​ family and is distinguishable by its bright yellow flowers. It is grown for animal feed use, for its oil for human consumption, and for biodiesel.

ADM has around 240 processing plants around the world, not only for oilseeds but also for corn, wheat and cocoa. But Joe Taets, managing director of ADM Europe, confirmed that this acquisition will mark its first facility for rapeseed in the CEE region – and will help it gain more presence in that high potential market.

“Campa’s location in the Danube river, with a presence close to the markets of the Czech Republic, Hungary and Solovakia, will provide excellent additional market opportunities for ADM,”​ he said.

The CEE region one of high potential for food manufacturers – and indeed other industries. Since Poland, Slovenia, Estonia, Latvia, Lithuania, Poland, the Czech Republic, Slovakia, Hungary, Romania and Bulgaria have all joined the EU in the last five years, earnings and consumer spending power have followed a general upward path.

In other oilseeds, ADM has already given clear indications of the importance of the CEE region. For instance, in March 2007 it moved to consolidate its position in Eastern Europe's burgeoning market for sunflower seed by buying ​the remaining shares in the Ilitchevskiy Maslo Extractionniy Zavod joint stock company (Imez) from Risoil, with which it had previously held an equal share in the venture.

This buyout enabled ADM to take full control of Imez's sunflower seed crushing facility near the Ukrainian port of Odessa.

The latest planned acquisition is still subject to antitrust clearance, and no anticipated closure date has been communicated by ADM. Financial details have not been disclosed.

Campa Sud, current owner of the plant in Straubling, has used it to produce oil and meal destined for the food, animal feed and energy markets.

However its holding company Campa AG filed for insolvency in May, with one of the main reasons being falling sales. A legal representative for the group was not able to respond immediately as to whether this was purely biofuels related, or whether to the food sector also had an impact.

On its website, Campa says it saw sales of €216m in 2005/6. Its vegetable oil production capacity was said to be 250,000 tonnes per year.

In 2006 Campa started construction of a new oil mill in Straubing, which was scheduled for completion in autumn 2007. It was not immediately clear whether this is the same facility that ADM is to acquire.

For the financial year ended June 30, ADM’s overall global sales were US$70bn.

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