[BILD] Mission Contact News Home [BILD] Home > Other > News > Reports Biomass and fibres Carbohydrates Protein Vegetable oil Special crops Downloads Interesting Links [BILD] [BILD] [BILD] [BILD] [BILD] [BILD] [BILD] [BILD] [BILD] [BILD] Meetings Reports Tipps Final Report Bornholm Lithuania Finland The Baltic Region BORNHOLM REPORT Content: Introduction Barries Labour Force The Company Structure Local Assets Regional Funds & Business Angles The Virtual Factories Access to Knowledge Agriculture Emerging Trends in the Community Value Added Opportunities for Agricultural Products Conclusions Case Studies: Boværk Johannes Dam og Søn Allara Baltic Board 50 ha : 32,6 % Value of land: 5.000 € - 16.000 € Arable land: 33.800 ha Plant production in year 2000 Crop ha Yield tons/ha Wheat 14.300 8 Barley 8.000 6 Oats 900 5,5 Rye 209 6 Oilcrops 2.100 3 Protein crops 100 4 Speciality crops 2.100 Other 6.200 Soil types: Clay 30 % Sand 70 % Set aside land 42 % 95 % of the primary agricultural production is sold unprocessed. top Emerging Trends in the Community The average age of farmers is increasing, indicating the possibility of necessary take-overs by yoúnger farmers in the not so far future. This is however contradicted somehow by a trend towards part time farming and “gentleman” farming. The average farm size is increasing, and the number of farms is decreasing, the average efficiency and yield seem however to be rather constant. From 1995 –2000 the number of farms was reduced by 3 % ,while the average size of farms has increased by 2 %. Some industries have been forced to reduce or stop their production due to bad economy, and very few new industries have been established, not only agro-industries, but industries in general. On the other hand many of the established industries seem to have a financial solidity that is above country average. 5,4 % of the companies have in 2001 increased both income and employment. In general, however, the industrial sector does not foresee any increase in employment in the near future. Currently there are very few IT based workplaces (e-trade, programming, call centre) on Bornholm. Only 0,7 % of the workforce work in this sector, which is far below the country average of 8,8 %. It has officially been decided to establish incentives for strengthening this sector on Bornholm, not least in view of the fact that IT work is not very dependant on the geographic location of the workplaces. A new project/concept, ”Digital Bornholm” has thus recently been launched. It is therefore anticipated that new employment opportunities will be created in the IT sector in the coming years. top Value Added Opportunities From Agricultural Products From locally produced by-products: Whey- specialty protein for food and non-food industries. Bran- specialty products for food industry Protein cakes and secondary metabolites- specialty proteins for food and non food application, pharmaceuticals Slaughterhouse waste Wood waste - Fuel pellets From traditional crops: Linseed/flax- specialty products for non-food industries, water purification etc Cereals- prebiotica for food industry, non-food commodities Oil-crops- biodiesel, lubricants, solvents New crops and specialty crops Protein crops -lupins Medicinal plants and herbs, e.g. mint Plants for cosmetic industry top Conclusion (what can be done) The public innovation practise on Bornholm is well developed and the local incentives available for entrepreneurs are extensive. Thus the local authorities and the Danish State have established a good public environment for a dynamic business climate, although regretfully so far with little avail concerning establishment of new production companies and industrial jobs. That may partly be due to the fact that the main innovation barrier, the remote position of Bornholm, which is the reason for most of the obstacles, cannot easily be overcome. Another barrier is the lack of higher education possibilities on Bornholm. It seems that the most innovative and dynamic regions in the Baltic Sea area are those, who have access to universities or other higher education centres. It might be concluded that what the county has done so far is impressive and also necessary, but not enough to initiate new productions on the island. Therefore new incentives and assistance strategies, well within the power of the local municipality should be initiated. The county might consider to: Establish a scout function to scout for entrepreneurial opportunities arising from spin offs from existing local companies, local research and development centres and EU research programmes. Example is the local business visitation programme established by the “International Science Park of South Denmark”. The science park has during the last year so far interviewed approximately 200 local SME’s and already established co-operation between some of the companies and the university. Improve the visibility of the local innovation support services, and assess the needs (besides financing) of individual potential entrepreneurs. Act as nurturer and convener . Bornholm might be too small for the establishment of a business incubator (example: Kauna Business Incubator, Lithuania), however the county might consider to create a kind of “incubator-without-walls” – a forum where entrepreneurs can meet with each other to share experience on management, marketing, financing etc. Develop a plan to attract successful entrepreneurs, from e.g. congested regions, who might want to leave their region and set up business operations in smaller, slower paced communities. Create contact with local stakeholders.(local funds, banks, municipalities etc.) Create an “Incentive package”. Make better local use of the two existing research centres. Formal contacts to universities in Denmark and Sweden (and eventual Germany and Poland) should be established, and training schemes for students and ph.D’s should be developed. This is a “next best” solution. The best solution – to establish an independent higher education scheme on Bornholm- is probably not feasible due to the small population basis. top Case Studies Companies, local farmers union, local funds and local authorities have been interviewed and asked to fill in the questionnaires. Also an entrepreneur, who has considered to move his activities to Bornholm, has been interviewed. Local SME’s Boværk Boværk is an old agro-industry that until recent years with success has been able to adapt to the inevitable changes in markets and technology that have occurred throughout the years. The company was established in 1941 by local farmers as a co-operative. Today it is a joint-stock company with farmers as major shareholders. The company started as a flax factory, and it soon became one of the most modern flax factories in Denmark. As flax fibre production became less and less profitable after the War, it was in 1949 decided to expand activities to other production areas, and this resulted in the establishment of one of Europe’s first green crop drying plants. At that time it was a new idea to produce dried grass meal, and later Boværk became the first company in Denmark and one of the first in Europe to produce fodder-pellets from alfalfa and grass on a large commercial scale. Green crop drying became later a relative large business with more than 50 production plants in Denmark and a yearly production close to one million tons/year. Due to a number of factors, such as increases in oil prices, reduction of EU subvention, reduction of cereal prices etc., it is today difficult to make a profit in the green crop drying industry, and Boværk has, with some success, tried to find new business activities. A plant for production of fodder-mixtures for cattle, pigs and chicken was built in 1979. Today Boværk produces only 3000 tons pellets pr. Year, which is no more than 10 % of the production potential. Boværk has modified some of its drying drums to dry cereals. The capacity is rather high, 30 tons/hour, and Boværk has in wet harvesting seasons saved the harvest for many farmers on Bornholm. However the profit from the seasonal cereal drying is modest. Boværk has been engaged in establishing many new activities on Bornholm such as wood chip (fuel) factory, a chipboard factory and a biorefinery. The chipboard factory, called Baltic Board, is still in operation, while the wood chip plant has closed down. In the middle of the eightieths Boværk had ambitious plans to establish a large agro-industrial conglomerate together with BAF, Baltic Board and the Carlsberg brewery. BAF and Baltic Board are physically situated very close to Boværk, and the idea was to have an interchange of by-products and products between the three companies and Carlsberg. The synergy effect would be considerable. Also the town of Aakirkeby was interested, and the municipallity had plans to establish a central heating plant based on byproducts from the conglomerate. Boværk was previously regarded as a technology leader in its field, and the management team had for many years a look of entrepreneurial spirit and willingness to invest in new technologies. However today the activities at Boværk have been reduced considerably, and most of the plant is rented to a feed mill (Bornholms Andels Foderstofforsyning – BAF). top Johannes Dam og Søn Johannes Dam og Søn is a family company. It was founded in 1885, and has been owned by the same family in five generations. The only production is rye-biscuits that are produced on the basis of a secret recipe inherited through generations. The quality is outstanding, and the product has received many national and international rewards. The products are sold in Denmark and exported to Sweden, France, Switzerland and Germany. The marketing function is out-sourced to a wholesale dealer (Borngros). The rye flour is milled at the local mill (Bornholms Valsemølle A/S in Aakirkeby) and the cereal grain is purchased through the local grain merchant – BAF. The company has very specific quality demands concerning the grain. Demands which not always can be met by BAF. The company is a small customer in the eyes of BAF, which in practise is the only importer of grain, therefore it is sometimes difficult to obtain the right flour quality. The annual turnover is approximately 7 million Dk kr. (1 million €), and the company has 10 employees. The owner has concrete plans for expansion of production leading to new working places. He is, however, to a large extend reliant on external capital, and he has not yet been able to raise the necessary capital (approximately 2 million kr. – 250.000 €). The necessary technical know how is achieved through the machine manufacturers and through consultation with technological development centres. top Allara Allara was founded approximately two years ago, and the turnover is still very modest. Allara is selling high quality rape-seed oil produced at Bioraf Denmark Foundation’s pilot plant. Allara buys the rape-seeds from BAF, and the seeds are processed at Bioraf Denmarks pilot plant. Allara receives the oil in bulk and taps it on bottles in its own bottling plant. The company is still in the expansion phase, and it is a family company with only one employee. It has however already received its first award ( five cooks caps) for outstanding quality, and the product is now sold in most parts of Denmark. Allara is financially weak, and further expansion is totally dependant on whether it can get access to external capital or not. Another barrier is high transportation costs to the major markets (big cities). The rape-seed variety influences the taste of the oil, and it is not always possible to purchase the most optimal variety. Allara is in this respect in the same situation as the biscuit factory. It is a small customer, and therefore reliant on, what BAF has in stock. The oil cakes are sold as fodder either through BAF or directly to farmers. top Bornholms Valsemølle A/S, Aakirkeby Bornholms Valsemølle produces wheat- and rye flour. It was established in 1867, and it is today still owned and managed by the same family (third generation).Both production and profit are modest. There are 9 employees, and the management has no plans for expansions. Approximately half of the yearly profit is used for modernising the plant. The management has no need for external help such as access to financial advise, technological knowledge, marketing etc. The mill has access to technical know how through the companies who produce the equipment that is being bought in accordance with the modernisation scheme. The mill produces various qualities of flour. The best flour is produced from durum wheat, grown on Bornholm by organic farmers. The climate and soils on Bornholm are excellent for growing of wheat, and the quality can be very high. Bornholm is the only locality in Denmark, where durum wheat can be grown in satisfactory quality and yield. The grain is bought through BAF, who purchases the grain from local farmers and also imports grain from, primarily, Germany. The mill has no storage facilities for grain, and therefore it is stored in the grain storage at BAF. BAF also buys the by-products from the mill (bran). The majority of the flour is sold in sacks through a retailer, however a minor proportion of the top quality flour is packed in 2 kg bags by the mill itself and sold (locally) as the mills own brand. top Baltic Board Baltic Board was established in 1973 on the initiative of the director of Boværk and Bornholm. Baltic Board produces thin, paper coated, chipboards for the furniture and building industries. The process is continuous (calander rollers) and the plant was in the beginning of the seventieths rather advanced. The press itself is somewhat similar to a paper forming machine, and it was expected that the production process would be much cheaper than for production of traditional chipboards. There is however one serious disadvantage, namely that the plant can only produce thin boards (up to 8 mm thickness).To this comes that the quality is not outstanding in any way. This limits the market possibilities considerably. As raw-material is primarily used wood from the forests on Bornholm. Baltic Board has for many years had financial problems. The bulk of the production is exported mainly to the UK. The competition is tough, and the only sales parameter, the company has, is price. It would be very costly to improve the quality of the boards, as this presumably would imply the installation of a new press, which is the most expensive equipment in the plant. Baltic Board was recently (for the third time) reorganised and new capital has been found. Entrepreneur, who has considered to start production on the island George Mhlanga has a master degree in agronomy from the Danish University of agriculture. He has developed a process for production of flocculants ( pectic substances) from by-products from linseed oil production. The flocculants may be used for water purification, and the municipality of Copenhagen has expressed interest in using his product in their water purification plants. George Mhlanga has received financial support for the preliminary development work from public and private funds, and the process is now so far that he is negotiating with commercial companies on establishing of a commercial production unit. He has co-operated with Bioraf, who has pilot plant facilities suited for his production. Bioraf has produced test batches intended for the further testing of the market. Mhlanga is interested in a further co-operation with Bioraf and would like to establish his processing plant on Bornholm. He has not been in contact with the local innovation centre and is not aware of the innovation tools available on Bornholm. Mhlanga has however no intention to move his family to Bornholm. His wife is also an academic, and she wants to continue her academic carrier, which presumably would be difficult on Bornholm due to lack of jobs, where her qualifications are needed. top Intranet