Smithfield targets Romania for expansion into Europe08 September 2006
ROMANIA - Smithfield Foods has targeted massive expansion into Romania as the lynchpin of its plans to muscle further into the European market.
As one of the giants of US meat processors, the company plans to use its size, expertise in the US meat market to build a pan-European business.
Smithfield is one of a growing number of large food companies that feel high-margin exports are the means to grow the business and keep shareholders appeased.
The need to grow profits, coupled with relatively less barriers to trade are the sparks of the ongoing globalisation in the food industry. Eastern Europe, with its upwardly mobile economies and access to the EU, has become attractive to many companies seeking emerging markets to grow their business.
In a presentation to shareholders yesterday Smithfield Foods' president and chief operating officer, Larry Pope, said the company's strategy is to develop low cost meat production in Eastern Europe and export into Western Europe. Romania is well suited to become part of the company's strategic growth, due to the relatively low costs of setting up plants there.
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Source: Cee-Food Industry