Interview Menno van der Post
Ambitious Compaxo sees bright spots in the pig market
A new generation of Van der Post took over the family business Compaxo a few years ago. Thirteen cousins are now active at the pig butcher and meat processor with locations in Zevenaar and Gouda. With the takeover, a new strategic plan was also developed, the implementation of which is now nearing completion: a considerably expanded and fully modernized slaughterhouse, which underlines the family's confidence in the Dutch pig sector.
Within a few minutes of stepping into the new imposing office building, the entire culture in which people work and undertake is actually told. In a T-shirt and jeans, director Menno van der Post opens the gate, after which we start the conversation in the boardroom. The 'just do it' business mentality can be read in everything. Only a single door and a glass wall separates the management room from the purchasing and sales departments.
"We want to work efficiently and that includes short lines," says van der Post, while we can follow the slaughter process live on large screens. Although chains represent an increasing share of the Dutch market, the focus on cost control remains a very important factor. Actually always, but certainly for the export-oriented Dutch market. "To a large extent, the pig (meat) price with the high degree of self-sufficiency is still determined on export markets and the supply is currently more than sufficient. What is really being paid for is shortages. Slowly but surely, we are currently seeing positive signals from multiple angles."
Export position specified location
The fact that export markets have long played an important role for Compaxo is apparent from the location of the slaughterhouse in Zevenaar. "In the last century, the German market was a very important sales market for Dutch pork. In the 70s and 80s, the previous generation wanted to provide the meat products company in Gouda with input. slaughterhouse where meat and carcasses were also going to be sold, a location was sought near the German border, which gave us good access to the German market and, moreover, the pig-dense areas in the Achterhoek and Twente were relatively close by. So."
With the opening of its own slaughterhouse, Compaxo became a more export-oriented meat company. Today, Germany is no longer the most important sales market and the company supplies dozens of countries worldwide with pork products. The location in Gouda, where meat products are produced, is mainly focused on the domestic market. About 10% of the volume from Zevenaar is ultimately processed by the company in the Gouda factory. "Yet they are not obliged to purchase from us in Gouda, sometimes they get a sharper offer in Gouda and that is fine."
Expansion and modernization of the slaughterhouse
Although the pork chain has been in difficult waters for some time, a major expansion and modernization of the slaughterhouse will soon be finalized in Zevenaar. The project was started at the end of 2020. The slaughter line has been renovated and/or expanded in many respects: the waiting shed for pigs supplied has been enlarged, extra drive rooms have been installed towards the stunning, the stunning capacity has been expanded and the location also has a completely new cutting room and a significantly increased storage capacity for carcasses. All this should improve the peace in the supply of the slaughter line and thus further improve animal welfare.
"When we came into the company as a new generation, we asked ourselves the question: are we going to stick with it or are we taking serious steps to be ready for the future. We have chosen to put our shoulders to the wheel and want to work on further growth of the company."
Compaxo has been able to expand its market share considerably in recent decades and is now the fourth largest slaughterhouse in the country, after Vion, Van Rooi and Westfort. "A few decades ago, we slaughtered about 10.000 pigs per week out of a Dutch total of 400.000 head per week at the time. While the number of animals processed in the Netherlands is now around 300.000 head per week, we currently process about 32.000 pigs per week. Since 2014 we have increased the number of slaughterings by about 10% and we want to continue to grow in a healthy way with the new investments."
Van der Post will not comment further on the target in terms of number of slaughters. In any case, the floor space in the new business set-up in Zevenaar will soon be doubled.
Although there is pressure on the size of the Dutch livestock, partly because of nitrogen, Compaxo is not afraid of a contraction for the time being. "Our company has weathered several storms. In addition, many piglets and fattening pigs go abroad, especially Germany. Due to the 5-D strategy there, the export of piglets and pigs has become less interesting and more pigs may remain at home. The magnifying glass under which livestock farming in our country is located is a concern for everyone in the chain, but we must be able to rely on our own (innovative) strength."
Van der Post indicates that the starting position of Dutch slaughterhouses has improved somewhat in recent years and that the payment capacity compared to German competitors has also developed positively. "Until 2015. Germany did not have a minimum wage. The introduction of this gave our competitive position an impulse. Subsequently, the outbreak of African swine fever has ensured that our export position is also significantly more favorable compared to German competitors. On balance, we can therefore offer more competitive prices on average. Pay."
German purchase price puts pressure on
However, the latter does not seem to be the case at the moment. While Compaxo has adjusted its purchase quotation upwards this year by €0,46 per kilogram of slaughtered weight (in line with the Dutch market), the German slaughterhouses increased prices by about €0,60 per kilogram of slaughtered weight. Although it therefore seems that the Dutch quotations are lagging, Van der Post believes that the German quotations have risen too hard and were lower.
"I understand that it seems strange for pig farmers, especially because our export position is comparatively better. However, the German slaughter sector is suffering a lot at the moment. Pig prices in all of our neighboring countries have risen less rapidly than in Germany. That is also why German slaughterhouses have little interest in slaughtering extra. It is probably not interesting for German parties to buy extra pigs for the purchase prices. Then it is better to leave the hooks empty. The fuss about the German quotations previous month are in that sense a writing on the wall, that comes about for a reason."
cautiously positive
Compaxo has good ties with several pig traders for the supply of pigs ready for slaughter. "We cherish this collaboration. We have no need to conclude direct supply contracts with pig farmers or anything like that. To say that the pig prices are too low is an understatement. We also prefer to pay €2 per kilo, but at the moment there is no room for that. Compaxo does see a cautious turnaround, however: "At the moment we are already seeing good demand from South Korea, the Philippines and Japan. There is also slightly more interest from China, also in luxury meat. In addition, Mexico recently lowered import tariffs on pork and other countries are planning to do the same. Exports to Australia are also continuing very well. On the supply side, we see that the slaughter numbers in the United States are considerably lower and that the number of sows in China is also clearly smaller than last year. Ultimately, all continents contribute to the creation of the pig price. We are cautiously optimistic for the coming months, also because of the shrinking pig population in Germany and the Netherlands."
The focus on export markets does not mean that the company does nothing at all in concepts. "The sale of our meat products from Gouda is often aimed at the Netherlands and therefore requires a large proportion of 1 star Beter Leven pigs. We also slaughter pigs from certain concepts every week on the basis of wage slaughter. 1-star pigs can be slaughtered, but we have been slaughtering them again for a few weeks."
Mutual interest
Ultimately, the parties in the chain need each other to create a good future for the chain. "We as a slaughterhouse, together with the pig farmer, have a common interest in adding value to production internationally. With a European self-sufficiency level between 120% and 130%, that is still very important for achieving a cost-effective pig price. current investments show that we are confident in the perspective of our industry."
This article was written in collaboration with Wouter Baan.
Steve Wissink
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