Over capacity and increased raw material prices behind Thai Union’s closure of Polish plant

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‘Over capacity in the market, coupled with increased raw material prices and the relatively small size of the plant means that we are increasingly uncompetitive.’

On Friday last week, SalmonBusiness reported on Européenne De La Mer’s plans to shutter its Dąbrowa Chełmińska plant in Poland.

Européenne De La Mer is a subsidiary of Thai Union Europe and a leading producer of salmon and smoked fish for the European and French markets.

Following up on this news, a company spokesperson has told SalmonBusiness about the decision, “Prior to making this decision we considered every possible alternative to liquidating the company and closing the factory. However, given current industry conditions in Poland and across Europe as a whole, this route is the most realistic outcome for the plant.”

The spokesperson continued, “There are a number of market and financial factors that are impacting the factory. There is over capacity in the market which, coupled with increased raw material prices and the relatively small size of the plant means that we are increasingly uncompetitive.

Despite efforts to turn around the plant, the company decided to cut its losses, “In the current market environment, we see no realistic opportunity to increase our volumes and scale up our operations.

“We intend to improve Thai Union and Thai Union Europe’s position in the industry and ensure that our operations are more robust and resilient as we continue to adapt to the demands of our customers and consumers and market conditions.”

“We remain focused on growth and take a long-term viewpoint, choosing profitable businesses and locations to drive a sustainable development. It’s important therefore that we constantly evaluate to ensure we’re able to develop in the correct way.”

Thai Union is one of the world’s largest seafood producers with annual sales exceeding US$4.2 billion.