[Business Scene] Ivica Pivac: We will complete the construction of the plants in Ravča and Ljubuški by the end of the year

The Pivac Group, which includes the Meat Industry Braća Pivac, PPK Karlovac Meat Industry, Vajda Meat Industry, and Kraš, ranks among the top of the domestic food industry.

During the pandemic period, this Group, which employs over two thousand people, increased its production capacities and achieved sales growth. In the dramatic year of 2020, it increased total revenues to 3.42 billion kuna, and last year it further solidified that position. – We are in very uncertain times, and past experiences have shown that it is ungrateful to make forecasts. However, we hope that the year 2022 will finally bring an easing of the pandemic. Although the corona crisis did not dramatically affect the food industry compared to some other economic sectors, the business conditions for us are far from ideal, so we hope that this year we will witness a positive resolution of the situation regarding Covid-19 – says Ivica Pivac, CEO of the Meat Industry Braća Pivac, headquartered in Vrgorac.

In addition to the immediate consequences of the pandemic, namely the difficult organization of business due to illness and preventive self-isolation of employees, the economic effects that impact business through rising input production costs are a challenge for them.  Last year, they experienced increases in the prices of raw materials, animal feed, certain categories of meat raw materials, fuel, protective equipment, and sanitation and hygiene products. Despite all these price increases, the prices of the final products of the Pivac Group have not changed significantly. – A drastic increase in the prices of electricity, gas, and petroleum derivatives has been announced for this year, which will automatically reflect on new increases in all types of raw materials, and thus, of course, on the additional rise in production costs. We have been witnessing inflation for months, and due to the announced increases in energy prices, we see inflation as the biggest challenge for business in 2022, both for the Pivac Group and for other economic entities in the market – states Ivica Pivac, who manages the family company together with co-owners, brother Neven and nephew Miljenko.

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Despite all uncertainties and aggravating factors, the Pivac Group firmly remains committed to its intention to continue investing in new technologies, machines, and equipment, expanding production and storage capacities, and in green transformation that will enable them energy self-sufficiency. By the end of this year, the completion of the second phase of the large meat processing plant and meat products Ravča 2 is expected, with a total value of 25 million euros, co-financed by European funds. Namely, immediately after the commissioning of the plant for the production of Dalmatian prosciutto and other dry-cured meat products, in 2020, construction of this new plant began right next to the prosciutto plant, which spans over 15,000 square meters.

 – This project is of exceptional importance to us not only because it will completely unify all production processes at one location but also because modernization and increased production capacities will ensure increased productivity, improved quality of final products, and open opportunities for better positioning in the market, thus enabling us, in the long term, to make a significant breakthrough in the European market – explains Pivac, who intends to continue strengthening sales in existing markets while also expanding into new ones in the coming years.

The Pivac Group markets its products in Germany, Slovenia, Bulgaria, Poland, Sweden, Romania, Austria, Belgium, and other EU countries, and it also records significant results in the Serbian market and other third countries. In the European market, they consider their value-added products, Dalmatian prosciutto, Dalmatian pancetta, and Dalmatian pečenica, which are protected by a geographical indication at the EU level, to have the greatest potential.

By the end of this year, they also plan to complete work in Ljubuški in Bosnia and Herzegovina, where a complex is being built on more than 20,000 square meters that will include production facilities for processing and meat processing and employ about fifty workers. However, this is not the end of investments for the Pivac Group, which also prioritizes the continued expansion of its own pig and cattle breeding capacities. In 2021, in the primary production segment, they reached over 11,000 head of cattle and more than 150,000 pigs.

– Our goal is to increase the self-sufficiency of our own raw materials for production needs, i.e., to ensure as large a share of domestic raw materials in final products as possible. In addition to raising cattle on our own farms, we also secure domestic raw materials through cooperation with Croatian farmers. We cooperate with more than 80 of them, primarily in Slavonia and Međimurje, and we plan to expand cooperation with all domestic breeders interested in collaboration – said the director of the Pivac Group, which also plans to expand its network of stores and modernize existing branches.

In the ownership of the Meat Industry Braća Pivac is also the tourism company Sol tourism, which has two hotels in Makarska and one hotel and one hostel in Dubrovnik. Pivac says that although they consider investments in tourism beneficial in the context of business diversification, they currently do not plan additional investments and expansion in that direction. Their focus is clear. – Regardless of all the obstacles and challenges we have faced in the past two years and those that lie ahead, our vision is clear: by continuing positive trends, further growth, and investments in production, self-sufficiency, and retail networks, we will continue to work on the revitalization of agriculture and production in Croatia – concludes Ivica Pivac.

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