German developer digs Hungarian agro plans | Business | Economy and finance news from a German perspective | DW | 28.03.2019

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German developer digs Hungarian agro plans

German developer Fakt AG’s horticultural center will be the third-largest foreign investment in Hungary, outstripped only by Mercedes-Benz and an upcoming BMW plant. The firm is building a complex to equal Europe's best.

German developer Fakt plans to invest €1 billion ($1.2 billion) in a horticultural production, processing and logistics center in the municipalities of Hegyeshalom and Bezenye in Hungary.

The project's sheer size is what stands out, the company says, with the site set to cover an area of 330 hectares (1.27 square miles), making it one of the biggest horticultural centers in the Central European region.

Fakt said it will build a processing and logistics unit, a 30-hectare greenhouse for growing tomatoes, peppers, eggplants and herbs, a 50-hectare outdoor area for the cultivation of asparagus and soft fruit, and a 15-hectare processing center, including warehouses, cooling and freezing facilities to process fruits and vegetables from all over Hungary.

A growing business

Greenhouse horticulture is the process of producing agricultural crops within a structured shelter to provide customized growing conditions. 

In 2018, the global greenhouse horticulture market size was $18 billion (€16 billion) and it is expected to reach $28.7 billion by the end of 2025.

Horticulture is the EU's fastest growing agricultural sector. European and UK fruit and veg farms grew in output by 15 percent between 2014 and 2015, according to the European Commission's Agriculture and Rural Development Department.

Read moreWhat makes tomatoes tasty?

"We're hoping for it to become one of the landmarks for Europe," Hungarian Agriculture Minister Istvan Nagy said. "This investment is the biggest and most complex agricultural and food industrial project of the last few decades and is unique in Central Europe."

By the way, Fakt also plans for the project to have Europe's largest onshore fish farm with king fish, salmon and other fish species. 

Greenhouse in full bloom

The new center will help plan food production in a more systematic way, Fakt believes

Fakt branches out

Fakt President and CEO Hubert Schulte-Kemper said the company chose western Hungary as it is located in the Budapest-Vienna-Bratislava triangle with excellent connections in all directions.

German cooperation Landgard will market the fruit and vegetables —  "a successful marketing producer cooperative with first-class connections to leading European retail chains," Schulte-Kemper said. Hungarian construction company Kesz Group and the German energy company E.ON are also involved. 

"The investment will unite the pillars of smart, affordable and sustainable energy," a board member of the Hungarian unit of E.ON, Zsolt Jamniczky, said in a statement, adding that the project could be a flagship for the whole of Europe.

Hubert Schulte-Kemper & István Nagy

Hubert Schulte-Kemper and Istvan Nagy after the announcement

Very cultivating

Jamniczky said Fakt aims to turn out agricultural and food products "in a modern, sustainable manner," while creating a livable working environment around the site. The CEO added that the investment would create 5,000 long-term jobs. 

Fakt, whose core sectors are in real estate, municipal infrastructure and capital markets, said a residential area was also planned, with about 1,000 apartments to be built on another 90 hectares, alongside a kindergarten, elementary school and facilities for further education.

The plans foresee a conference center including a hotel, restaurant and a shopping mall. Also, there's the modern camping area for stationary truck traffic and regular tourism. The investor also plans to cooperate in training, higher education, and research in the region.

Großbritannien - Harrogate Spring Flower Show

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Hungarian market a key to Europe

Nagy noted that in 2018, Hungary imported fresh fruit to a value of 83.8 billion forints (€260 million, $305 million) and fresh vegetables worth 75.5 billion forints. He said the Fakt investment was a huge step towards reducing imports, citing as an example the untapped potential for production of tomatoes and cucumbers for both domestic and export consumption.

Hungary has an abundance of geothermal energy and sunlight, although Csongrad county in the southeast bordering Serbia and Romania has been the natural center of domestic horticulture, with a large Dutch presence since the 1980s and the largest geothermal greenhouse complex in Europe.

Watch video 02:45

Horticultural show in northeastern Berlin