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Agroferment to build ten plants for Ft 1 bln apiece

Agroferment Kft, a company owned by Hungarian investors, plans to build ten bio-fertilizer plants in Hungary at a cost of Ft 1 billion apiece, business daily Világgazdaság reported on Tuesday.

The plants, to be built as franchises, have already been approved by the Agriculture Ministry, Agroferment manager István Ugrai told the paper.
Construction of the first plant, in Mezőkomarom, southwest Hungary, started in August, and production could start as early as in Q3 2007. The next plant will be built in Füzesgyarmat, southwest Hungary after the necessary permits are obtained, and another two towns have already been picked as locations for a further two plants. Some 40 towns have expressed interest in the remaining six plants, Ugrai said. All of the plants are expected to be completed by 2008, he added.
Agroferment will pay Ft 200 million-Ft 230 million for each of the plants from its own resources and the rest will be financed from bank loans. The plants will be operated by companies in which the local governments, which will provide the sites and infrastructure, own minority stakes.
The plants will process an annual 50,000 tons of manure and organic waste each, turning these into 25,000 tons of bio-fertilizer. Each of the plants is expected to employ 50-60 people.
Agroferment is already planning a similar-size network of plants in both Slovakia and the Czech Republic, and has even set up project companies in these countries. The necessary permits have already been issued by the authorities in the Czech Republic, but negotiations are still ongoing in Slovakia.
Because of the EU's campaign to decrease the use of artificial fertilizers, Agroferment's business plan has attracted interest in Austria, Finland, the Netherlands and Denmark. Ugrai said they are in talks with Austria's Alpine AG on the sale of franchise rights.