KTG Agrar passes 30,000 hectares mark
- Winter seeds come safely through the cold season
- Secured costs of supplies indicate good margin in 2010
- Biogas will become the growth driver in 2010 and 2011
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Hamburg, 10 March 2010 – KTG Agrar AG (ISIN: DE000A0DN1J4) is continuously expanding its position as a leading agricultural company in Europe. Compared to the period last year, the company’s farmland increased by 3,500 hectares. Specialising in the cultivation of organic and conventional food crops such as grain, maize and rapeseed, the company now has a total of 30,500 hectares for the 2010 season – an area the size of approx. 41,000 soccer pitches. 5.700 hectares of the total are owned by KTG Agrar. The remaining farmland is leased under long-term leases of more than ten years. “The 30,000 hectare mark represents an important milestone. While size alone is no guarantee of success, it allows us to use the largest and most efficient machines, buy direct from fertiliser and machinery producers and supply the leading processors with no need for a middleman,” says Siegfried Hofreiter, CEO of KTG Agrar. “This helps stabilise our margin strongly.”
The Hamburg-based company is optimistic about the year 2010. Says Siegfried Hofreiter: “We will boost both our total output and our profit in the current year.” By expanding its farmland, the company has already laid the foundation for this growth. Furthermore, the winter grain sown in the autumn spent the winter months safely under the thick layer of snow, and the company bought the necessary supplies at an early stage. The nitrogen requirements for the year 2010 have already been covered, and the diesel requirements have largely been satisfied. Nor is there any urgent need for action with regard to potash. “We therefore project a stable margin for the sale of the 2010 harvest,” says Siegfried Hofreiter. On the cost side, the company additionally benefits from the operation of its own biogas plants. The fermentation residues produced in these plants is an excellent natural fertiliser, allowing the company to reduce its dependence on fertiliser suppliers.
The biogas segment will be the company’s growth driver in 2010 and 2011. Here, too, KTG Agrar has already laid the foundation. Production capacity is planned to be increased to roughly 14 megawatts (MW) by mid-2010. In Flechtingen, a 3.2 MW biogas plant went online at the beginning of the year, while another 3.2 MW plant is under construction in Seelow. Completion of the latter is scheduled for summer 2010.
“At present we have ideal conditions for the operation of our integrated biogas plants. We want to take advantage of this situation and increase our investments,” says Siegfried Hofreiter. The company aims to have some 20 MW connected to the grid by 2012/2013 and to generate annual revenues of approx. EUR 30 million with these plants. Due to the integrated concept, KTG Agrar’s biogas segment generates an EBIT margin of over 20 percent. The integration of food crop cultivation and biogas production leads to substantial synergies. Given that the plants are located on the sites of the farms, the input materials can be grown in the immediate vicinity. Besides energy maize, agricultural resources such as grass and straw are used. Intercrops are also gaining importance. Following the grain harvest in the summer, millet and clover grass are sown and harvested in November. Two harvests per year mean that the costly machines can be used for a much longer time. It is planned to run the biogas plants almost exclusively on grass and intercrops in only a few years’ time. Says Siegfried Hofreiter: “The biogas sector is still young. Efficiency and, hence, our margin will grow as a result of technological and breeding progress.”