AB Akola Group plans to expand feed production and apply for National Paying Agency support

One of the largest agricultural and food production groups in the Baltic States, AB Akola Group, which owns the company Kauno Grūdai, is continuing its plans to expand production capacity and increase competitiveness. The Group intends to submit its application to the National Paying Agency in the near future and seek to participate in the upcoming EU support call. It plans to apply for approximately €10 million in support.

The group's performance over the twelve months of 2024/2025 showed that demand for compound feed remained exceptionally high, with production reaching record levels and revenues growing by 16.9%, making it necessary to continue investing in greater production capacity. The pet food segment recorded a 2% decline in production and an 11% decline in sales, mainly due to the reorientation of the product portfolio towards premium products. Such products have lower production efficiency but are more profitable, so annual revenues remained stable, with premium and mid-range pet food accounting for as much as 86% of total production, compared to 50% a year ago. This indicates a clear market shift towards higher value-added products.

"Our goal is to prepare for upcoming funding calls and evaluate the best technological solutions that would help increase production capacity and strengthen Akola Group's position in both the compound feed and extruded product markets. We are currently focusing on the technology tender and budget planning, and we will make the final investment decisions later, after evaluating all alternatives," says Mažvydas Šileika, CFO and member of the board of AB Akola Group.

According to him, Kauno Grūdai currently operates three factories in Alytus—two producing instant products and one dedicated to pet food. The final location of the new compound feed plant has not yet been decided, with several alternatives, including Alytus, under consideration. The project is expected to be implemented within the next two to three years.

Currently, Kauno Grūdai, a member of the Akola Group and one of the largest feed producers in Lithuania, has a production capacity of 50 t/h for loose feed and 40 t/h for pellet feed at its Kaunas factory. The planned new project would increase these capacities to 80 t/h and 60 t/h, respectively. Relocating the pet food production line to a new building would enable production capacity to grow more than threefold.

The total value of the project is estimated at around €90 million, with approximately €10 million expected to be covered by EU support and the remainder financed through the company’s own and borrowed funds.

“This investment is primarily intended to meet the strong demand for compound feed from Lithuanian farms. By increasing production capacity, we aim to ensure a reliable supply to the local market and set new standards of efficiency and quality in the industry. We see that the livestock, dairy, and poultry sectors in Lithuania and the Baltic countries are developing successfully, so the new plant will meet the growing needs of these sectors. It is an important step toward achieving the company’s long-term strategic goals. We attach great importance to people—investing in the development of our employees’ competencies is essential for maintaining high operational quality and delivering on our ambitious plans for the future,” says Andrius Pranckevičius, Deputy Chairman of the Board at AB Akola Group and CEO of Kauno Grūdai.

Over the past few months, the Group has carried out construction and technology cost assessments, inviting construction companies and equipment suppliers to provide budget estimates. In the near future, the focus will shift to preparing for the funding call and selecting the technological solutions.

AB Akola Group is the largest agricultural and food production group in the Baltics, employing more than 5,000 people. Operating across the entire food production chain—from field to fork—the Group produces, prepares, and sells agricultural and food products and supplies goods and services to farmers. The Group’s financial year begins on 1 July. For the twelve months of the 2024/2025 financial year, AB Akola Group recorded consolidated revenue of EUR 1,580 million, up 4.9 percent compared with the same period a year earlier. During this time, the Group achieved the second-highest profit in its history, exceeding €62 million.

More information:

Mažvydas Šileika, Chief Financial Officer and Member of the Board of AB Akola Group

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