Kepak signs €35 million contract with China-based distributor

Kepak Group has announced that it has signed a five-year distribution contract with China-based Esen Agro Group

The deal, which is valued at €35 million, follows the recent announcement that Kepak’s Cavan-based pork and bacon producer McCarren Meats has been approved for exports to China.

Kepak has also announced that it will expedite its planned investment of a further €3 million at McCarren Meats, adding additional throughput capacity, which will now come into production later this year.

This investment will lead to the creation of a further 25 jobs at the site, bringing the total number of employees there to 295 by late 2019.

Commenting on the deal, Minister for Agriculture, Food and the Marine Michael Creed said: “The announcement by Kepak today is extremely welcome news, particularly for the local economy in Cavan and the surrounding counties.

“In the context of Brexit, access to new markets is an important part of our mitigation strategy. This deal will help safeguard pig producers in Cavan and the border counties as it provides increased capacity, to locally process pigs that can now be marketed in every key market for Irish pork.

The opportunity that the Chinese market represents for Irish meat companies, such as Kepak, is incredible and I am hopeful that we will see many more deals being signed in the short term.

John Horgan, managing director of the Kepak Group, said: “This announcement by Kepak is a major boost to McCarren Meats, which is a fifth-generation family business that has been the heartbeat of Cavan for many decades.

“From a business perspective, this deal copper-fastens the future of McCarren Meats as the Chinese market represents a major opportunity to add further value to the pork products produced at this facility.

“More generally, Kepak considers China to be a vitally important market and we look forward to building on already strong relationships to create further business opportunities there.”

Kepak contributes more than €35 million annually to the local economy in Cavan and surrounding counties through McCarren Meats – an increase of 50% since it acquired the business in 2013.

Since the acquisition, Kepak has invested €15 million in the business and boosted staff levels by almost 40% – from 194 in 2013 to 270.