Goodbye, cows (illustration)
Photo: AP
Tnuva closing dairy in Romania
Israeli cooperative halts activity in dairy farm due to poor profitability
Israeli cooperative Tnuva is halting its dairy processing plant activity in Romania due to financial considerations. The dairy farm has 1,200 milch cows which supply 25% of the production.
"The dairies aren't Tnuva's core business, so we asked ourselves whether we should invest efforts in breeding cows. The dairy is not profitable and was built at the time to ensure the supply of milk to the milk processing plant when there was a milk shortage in Romania. This is not the situation today.
According to Tnuva CEO Arik Schor, the cooperative has enough milk from external dairies.
Price Hikes
Ofer Petersburg
Israel's poor population hurt again, as prices of subsidized dairy products to increase by 2-5%
"Our suppliers in Romania include the dairies set up by Israeli company Adama Holding, so the issue of shutting down the dairy was thoroughly examined," said Schor.
The dairy is located 20 kilometers (13 miles) outside Bucharest, near the Tnuva dairy which was built at an initial investment of €55 million (about $75 million). The dairy farm, which stretches over 50 acres, was purchased for €1 million ($1.37 million) from a Romanian cooperative which was dissolved after the collapse of the Ceausescu regime.
An Israeli team renovated the dairy farm structures, set up a modern milking facility and imported the cows through Germany. According to Schor, the Romanian authorities are considering building an airport on the dairy farm area.
Tnuva's dairy in Romania, which was inaugurated in 2007, was affected by the financial crisis in the Eastern European country and currently accounts for only 7% of the dairy products market in Romania, while Danone holds 35%. Despite the heavy losses Tnuva suffered, the company has decided to continue operating the dairy.
- Follow Ynetnews on Facebook
