The matter in summary Tine and Nortura report on a very good year in 2023, despite the lack of eggs and milk. Nortura achieved an operating profit of NOK 258 million, and for the first time turnover exceeded NOK 30 billion. Tine experienced an increase in sales revenue of 6.6 per cent from 2022, with an annual profit after tax of NOK 1.2 billion, an increase of 7.4 per cent from the previous year. Despite profits, Nortura is considering splitting the company in two. It is expected that 20 million eggs will be produced too few in 2024. The Directorate of Agriculture provides NOK 17 billion in production and replacement subsidies to Norwegian farmers. The year 2023 was characterized by both a shortage of eggs and milk. And it was the egg market that suffered the worst. There was simply too little produced in relation to consumption and sales. Nevertheless, Nortura and Tine deliver major profit improvements, according to their annual reports. Nortura’s operating profit ended at NOK 258 million, and Nortura’s turnover exceeded NOK 30 billion for the first time. A record there. – We are very proud and relieved that we can deliver positive figures, says CEO of Nortura, Anne Marit Panengstuen. CEO of Nortura, Anne Marit Panengstuen. Photo: Philip Hofgaard / news Despite the profit, Nortura is considering splitting its company in two. Read why. Did not fill the quota Approximately one percent too little milk was produced in relation to demand, according to the Norwegian Directorate of Agriculture. This is not serious. Put simply: There was no extensive milk shortage last year. But the quota filling itself was 88 per cent. This means that Tine had to use the warehouse they have built up. – This has led to using up the stock of milk powder, says Ståle Hustoft, leader of the Rogaland farmers’ association. Drying milk into milk powder is an important part of market regulation, but the shortage has now led to the Norwegian Directorate of Agriculture lowering the duty on milk powder. Hustoft is a dairy farmer himself and delivered 80 percent of his own quota last year. – I did contribute to a lack of coverage, but it was mainly due to drought. It spread over the grazing area, he says. Dairy farmer Ståle Hustoft with a machine in the barn. He says 2023 was a tough year for dairy farmers. Photo: Gisle Jørgensen / news Profit for the farmers But Tine’s sales revenue in 2023 ended at around NOK 26.5 billion. This is an increase of 6.6 per cent from 2022. Annual profit after tax ended at NOK 1.2 billion, an increase of 7.4 per cent from the previous year. – This means that we can distribute over one billion kroner to our owners. It is the ultimate proof that you are making a difference when you choose Tine in the store, says CEO Ann-Beth Freuchen. The subsequent payment is adopted by the annual meeting in Tine and paid out in May. This means that over one billion kroner is distributed to the 8,000 dairy farmers in the country. Although too little milk was delivered in 2023, there was still no shortage of milk on the shop shelves. And Tine sold well, also this year. Photo: NTB Looking brighter at 2024 Milk farmer Hustoft says 2023 has been very challenging for dairy farmers. – We knew it was going to be a demanding year because cost growth hit hard. But he hopes and believes 2024 will be a better year for farmers. – We take a brighter view of this year based on the fact that the cost level has stabilized and partially decreased, he says. He says it is good that Tine has made a profit despite the lack of production. – Now there has been a focus on the fact that we have not been able to cover the market, so this is very positive, says Hustoft. Hustoft is happy with Tine’s annual result. But he is not giving up the fight for dairy farmers to be paid better. Photo: Marthe Synnøve Johannessen Egg crisis You may also have noticed that there have been fewer eggs on the shop shelves? The forecast for this year is that 20 million eggs will be produced too few. In the last ten years, the hens have laid more eggs than we Norwegians have been able to eat. This also happened last year. Nevertheless, we saw a lack of eggs: in several stores, notes like this have been stuck on the egg counter. And it will continue in 2024. Photo: Celina Ekholt According to Nortura, a major disease outbreak in Sweden and Europe, as well as a weak krone exchange rate, has caused several players to buy more Norwegian eggs than normal. – Terrible situation Egg farmer Halvor Sveen in Østerdalen is straight when he is asked how 2023 has been: – Absolutely terrible. – We have an economy that does not resemble the pig. The hen produces well, but the price to the producer must rise drastically, he says. Halvor Sveen is an egg farmer in Rena in Innlandet. He says the hens produce well, but that the pay is too poor. Photo: Frode Meskau / news Egg farmer Trond Elden in Steinkjer says the egg year 2023 was perfectly fine, with the exception of what he was paid. He believes that much of the lack of eggs in Norwegian shops is due to people hoarding. – The moment the media talk about deficits, many people run to the store and stock up. It is very unfortunate and creates a completely wrong picture of what is really the case, says the farmer. Trond Elden is an egg producer and farmer from Steinkjer. He says Norwegian egg producers are good at producing healthy, beautiful and disease-free eggs without the use of medication. Photo: Eivind Aabakken / news Getting paid more Nortura has the opportunity to set the prices for eggs twice a year. When the prices were set in October, they increased by 40 øre. The next possible pricing will be in May. It has not yet been decided whether Nortura will give the farmers some of their profits in 2023. But Nortura’s central board does not recommend that the farmers should be paid anything. – In 2022, we ran into a large deficit as a result of the cost increases. We need this money to ensure Nortura’s solvency, says executive director Kjell Rakkenes. A tray with eggs at Steinsland & Co. on Jæren. Photo: Ole Andreas Bø On Wednesday, it became known that the Norwegian Directorate of Agriculture is giving NOK 17 billion in production and replacement subsidies to Norwegian farmers. Close to 37,200 agricultural enterprises will be paid production and replacement subsidies this week. The one-off payment in production support has never been larger. NOK 2 billion more than last year will be given. – It is not surprising. This is from the outcome of negotiations last year. It is not enough, but it is at least a significant degree of cost recovery, says dairy farmer Hustoft.
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Huge profits for both Tine and Nortura – despite a poor production year
