AarhusKarlshamn in j.v. to increase rapeseed oil

by Eric Schroeder
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KARLSHAMN, SWEDEN — AarhusKarlshamn (AAK) and Lantmannen Energi have signed an agreement to form a joint venture company that will invest approximately 400 million Swedish kroners ($59.5 million) in increased capacity for the production of rapeseed oil for foodstuffs and biodiesel in Karlshamn. As part of the venture, AAK would own a 51% stake, while Lantmannen would control a 49% interest.

"The new plant will have a capacity sufficient to crush and refine all Swedish rapeseed," said Magnus Jorsmo, president, Business Area AAK Technical Products and Feed. "With a joint, large scale plant we will satisfy the increased demand for rapeseed based products for both foodstuffs and biofuels."

According to AAK, the planned investment signals a significant increase in capacity over that currently in place at Karlshamn, making it by far the greatest in any of the Nordic countries. The plant will be placed within AAK’s plant in Karlshamn where Lantmannens production of biodiesel also is located.

"The joint venture will further strengthen our market position and secures a Swedish biodiesel with high quality, while at the same time providing prerequisites for increased production of biodiesel within Lantmannen," said Bengt Hakansson, president, Business Area Lantmannen Energi. "The investment will strengthen the competitiveness for Swedish farmers."

The jointly owned crushing plant is scheduled to come on line in the second half of 2009 and will generate profits from the end of 2009.

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