Israeli dairy producer Tnuva is considering closing down its Romanian operations and pulling out of the country, according to the Israeli publication Globes, quoting sources from inside the company. Tnuva invested NIS 300 million (EUR 60 million) in its dairy unit in Romania. Tnuva Romania is causing heavy losses for the company, and if the company cannot sell the business, it will shut it down, writes Globes.

The Israeli company opened Tnuva Romania in 2005, aiming to establish a complete system from milk production through to distribution under the Tnuva and Yoplait labels. Tnuva was planning to reach a turnover of EUR 50 million in the first three years, but its sales amounted to just EUR 20 million. Moreover, according to Globes, Tnuva could not compete against lower cost dairy imports during the 2008 economic crisis and Tnuva Romania Dairies' output was 50 percent more expensive per liter than local dairies.

In July 2008 Tnuva bought its partners in Tnuva Romania Dairies for NIS 60.7 million (about EUR 12 million). Read the entire Globes article here.

Earlier this year Tnuva closed down its Romanian dairy farm, in Adunatii Copaceni, as it was not profitable. The farm had 1,200 cattle, which covered 25 percent of the milk production of Tnuva’s Popesti Leordeni factory.

Irina Popescu, irina.popescu@romania-insider.com

(photo source: Tnuva.ro)