Cargill breaks ground for poultry plant in Nicaragua

US Agri-giant Cargill invests US$ 3.5 million in Nicaragua for the construction of a poultry plant for processing 2.5 million birds per year. The company will also build a distribution centre.

The opening of the farm, scheduled for next September, will generate 100 new direct jobs and about 2,000 indirect jobs.

General Manager of Cargill Nicaragua, Xavier Vargas Montealegre, said the plant is the first step of investments totalling $30 million over a period of three years.

The company will also invest in a new distribution centre, improvement of existing processing plants and the purchase of more vehicles to strengthen the fleet that has to distribute the products.

Vargas also stated that in 2012 the company plans to grow production by up to 5% compared to last year, which recorded an output of approximately 110,000 tonnes of chicken. Cargill currently has 12,000 customers nationwide.

Stable prices expected
Meanwhile, Cargill corporate vice president, Alfredo Velez, stated that for the next few months the price of chicken will remain stable because internationally there is “more stability” in the costs of feed raw materials. However he did not rule out that a further increase in the energy bill will change this panorama.

“A price increase for energy works out very negative for our business, since all our chicken is sold frozen, refrigerated. We spent about a million dollars in energy costs between energy supplier Pipasa and Cargill,” he said.

For his part, Vargas reiterated that 2011 was “very challenging for the poultry industry in Nicaragua,” which faced a rise in production costs due to the “price increase in products such as corn, soybeans and sorghum and a larger demand for production of birds.”

However, he stressed that according to experts analysing the relative stability of these “commodities” makes you believe that this year will be more stable.