Südzucker subsidiary CropEnergies temporarily pausing production at Ensus: One-off costs of up to EUR 40 million expected
CropEnergies AG, Mannheim, a subsidiary of Südzucker AG, Mannheim, is temporarily pausing production of its English subsidiary Ensus UK, Wilton. This decision has been made due to the current difficult situation in the European bioethanol market which the dramatic drop of oil prices in the last few months has exacerbated. Bioethanol prices reached an all-time low of EUR 417 per cubic meter FOB Rotterdam on 15 January 2015. The devaluation of the euro compared to the British pound was an additional burden. The drawn-out political process in the EU to also increase the percentage of renewable energies in the transport sector compared to today is not conductive either. The production facility was brought off line a few days ago for cleaning and inspection. CropEnergies’ other plants in Germany, Belgium and France are running at high ca-pacity utilization despite the difficult market conditions and thus prove their leading technological position and competitiveness.
As soon as market conditions allow, the English production plant can be brought on line again and CropEnergies Group´s full annual production potential of 1.2 million cubic meters can be exploited. The possibility of recommissioning will be continuously reviewed against the backdrop of upcoming policy decisions.
CropEnergies expects the temporary shutdown to lead to one-off restructuring costs of up to EUR 40 million in the consolidated financial statement for financial year 2014/15, impacting also the consolidated financial statement of Südzucker.