Romanian meat business invests in sausage plant

The investment will allow Meda Prod 98 to raise its dry sausage production capacity.

“The demand for processed meat products is on the rise again, and this is why we made this investment,”​ Luchi Georgescu, the majority shareholder of the meat processor, told local business daily Ziarul Financiar.

Meda Prod 98 specialises in processing a wide range of pork meat products. These include sausages, salamis, hams, as well as various dry meat products, according to data from the Romanian company. Meda Prod 98 supplies its output to some 2,000 retail outlets in Romania.

Increase sales​

The latest investment by the firm follows the release of its improved financial results for last year. In 2015, Meda Prod 98 reported revenues of some RON131m (€29m), and a net profit of RON11m (€2.4m), according to data the firm submitted to the Romanian Ministry of Finance. Since 2010, the company has managed to increase its sales by some 31%.

Meda Prod 98 said its Bucharest-based plant was modernised in 2008, when its meat processing capacity was raised to about 40 tonnes of various products per day. The company’s facilities are ISO 9001- and 22000-certified, according to data from Meda Prod 98.

Set up in 1998 and headquartered in Bucharest, the meat processor said it was operated by a workforce of 475, employed in Craiova, Arad, Turda, Bacau and the Romanian capital.

Meda Prod 98 is one of the top 20 meat processors active in the Romanian market, according to figures from the Romanian Finance Ministry.

On a related note, last year, Romania’s meat industry players managed to raise their export sales by 17% to €250m, according to data released by the Finance Ministry.

Leading export destinations​

Some of the leading export destinations for local meat processors include the UK, France and Bulgaria. Other major foreign markets for the country’s meat processors include Germany, Greece, the Czech Republic, Slovakia, the Netherlands and other EU member states, as indicated by figures from the ministry.

In addition to the increase in export sales, domestic demand is also expected to further drive the expanding sales of Romania’s meat industry. Florin Rizea, chief executive of Meda Prod 98, said the country’s meat consumption was expected to increase in the coming years due to the government’s decision to cut the value-added tax (VAT) on meat from 24% to 9%.

The move was designed to stimulate the domestic demand for meat, but also combat tax evasion, which has been plaguing the country’s meat industry. Liviu Harbuz, deputy head of the Romanian parliament’s Agriculture Commission, told local media that this issue had an impact on as much as 40% of Romania’s meat sales, representing about €1.5bn.