In order to achieve a stable milk price, a long-term agreement on German market conditions is entered with the German dairy group Fude + Serrahn Milchprodukte GmnH & Co. KG
As from 1 April 2015, there is no longer milk quota in EU and thus the milk production is solely based on market conditions.
FirstFarms, who operates agriculture in Slovakia and Romania, has for some time focused on finding a strong partner to buy the company's milk production in Slovakia. Here is a total of approx. 2,600 milking cows having an average yield of 9,500 kg milk, 3.8 per cent fat and 3.4 per cent protein.
- Our goal has been to ensure a stable sale at a reasonable price on known, long-term conditions similar to what other milk producers in EU have, says CEO for FirstFarms, Anders H. Nørgaard.
The selected partner is the German dairy group Fude + Serrahn Milchprodukte GmbH & Co. KG, based in Hamburg and with three dairy plants in Germany. The group had in last financial year a turnover of EUR 740 millions and generated approx. 800,000 tons of milk.
An irrevocable agreement
Until the agreement with Fude + Serrahn was concluded, FirstFarms sold its milk on the spot market, where the price has been decreasing for some time.
- Now we follow a milk price which is calculated based on what a handful of German dairies pay their suppliers.
- In this way, we are ensured reasonable market conditions, as the agreement is also irrevocable for a long time ahead, says Anders H. Nørgaard.
FirstFarms already has an export license, which can now be used in cooperation with the German dairy group to export milk around in EU.
- It creates new possibilities for us and them, that we are partners now, he states.
FirstFarms announced in its latest interim financial report published 25 November 2014, that the cooperation with Fude + Serrahn was concluded.
Picture 1
FirstFarms stable in Plavecky Štvrtok in 2014. Here is room for a total of 2,700 cows at full capacity.
Picture 2
The milking is done in two large parlors with room for 40 cows in each.
Further information at FirstFarms A/S, CEO Anders H. Nørgaard on +45 75 86 87 87
FirstFarms A/S is Denmark's only stock exchange listed public company with activities in the primary agriculture. FirstFarms A/S was listed in December 2006 and has now approximately 3,500 shareholders and a share capital of DKK 47,122,410. The activities are in agricultural companies and land in Slovakia and Romania. The company operates a total of 15,500 hectares, 2,600 dairy cows and employs approximately 200 employees. In 2013, FirstFarms A/S realised a turnover of DKK 114.1 million, and EBIT result of DKK 11.2 million and a pre-tax result of DKK 4.5 million. In 2014, FirstFarms A/S expects an EBIT result of DKK 17-22 million.
