Arabfields, Newsroom, Romania — Grup Șerban Holding, a prominent player in Romania’s agri-food sector, has unveiled a ambitious €62.5 million investment plan aimed at establishing a state-of-the-art potato processing facility in Sascut, Bacău County, while simultaneously expanding its cold storage infrastructure for vegetables. This four-year initiative, spanning from 2025 to 2028, marks a significant step toward addressing longstanding gaps in the country’s potato processing capabilities, particularly in the production of frozen French fries and potato flakes. Approved for substantial non-reimbursable state funding in September 2024 through the Agency for Financing Rural Investments, the project underscores a growing commitment to bolstering domestic agro-industrial capacity amid rising global demands for value-added agricultural products.

Founded in 1994 by Nicolae Șerban and now co-led with Irina Șerban, Grup Șerban Holding has evolved into one of Romania’s leading integrated agri-food enterprises. Operating primarily in the North-East Region, the company manages an expansive portfolio that includes agribusiness, livestock farming, logistics services, and food production. It cultivates 13,000 hectares of land, with 2,500 hectares equipped with advanced irrigation systems, enabling large-scale vegetable farming. As the nation’s top supplier of processing potatoes to major clients like PepsiCo Romania, and a key provider of fresh potatoes to modern retail chains, the holding has built a reputation for reliability and innovation. Its existing storage facilities already boast capacities exceeding 21,500 tons for vegetables and 162,000 tons for grains, positioning it as a frontrunner in cold storage solutions. Listed on the Bucharest Stock Exchange under the ticker GSH, the company continues to grow through strategic investments in precision farming, technology adoption, and partnerships that enhance operational efficiency.

At the heart of this latest venture is the potato processing plant, which represents an investment of €47.2 million, including €28.3 million in non-reimbursable state aid. Designed as the largest such facility in Romania backed by domestic capital, the highly automated line will process 6 tons of French fries per hour and 1.2 tons of potato flakes per hour. This translates to an annual output of approximately 30,000 tons of frozen French fries and 6,000 tons of potato flakes, with some projections indicating potential for up to 35,000 tons of pre-fried products and 7,000 tons of related items like hash browns. The plant’s focus on automation not only promises to elevate production standards but also aims to cater to both local consumers and international markets, where demand for convenient, high-quality frozen potato products remains robust. By targeting an underdeveloped segment of the market, the initiative seeks to reduce Romania’s reliance on imports for processed potatoes, which have historically dominated due to limited domestic capabilities.

Complementing the processing plant is a €15.3 million expansion of cold storage and logistics infrastructure, supported by an additional €9.7 million in state funds. This includes the construction of five new cold storage halls, each capable of holding 6,000 tons, for a total added capacity of 30,000 tons. A 5,000-square-meter logistics warehouse will facilitate efficient distribution, while a dedicated sorting, washing, and packing line will handle up to 10 tons of finished potatoes per hour. Upon completion, these enhancements will elevate the group’s overall cold storage capacity from 21,500 tons at the end of 2024 to 51,500 tons, solidifying its leadership in vegetable preservation and supply chain management. This vertical integration allows the company to oversee the entire production cycle, from field harvesting to final delivery, ensuring traceability, quality control, and cost efficiencies that mitigate risks associated with external suppliers.

Nicolae Șerban, the founder and CEO, emphasized the necessity of continuous expansion in a competitive landscape. « Companies that stop expanding will die sooner or later, » he stated, highlighting the project’s role in pioneering potato processing in Romania. Irina Șerban, co-founder, elaborated on the strategic vision, noting, « Through these two projects, the potato processing plant and the storage and processing halls, we are completing the cycle initiated by Grup Șerban Holding in recent years. These investments close the loop in our production chain: from harvesting to processing, storage, and delivery. This way, we achieve full control of the process, ensuring consistent quality and superior efficiency. »

The investment arrives at a critical juncture for Romania’s potato sector, which grapples with multifaceted challenges. As one of the European Union’s largest potato producers, Romania ranks among the world’s top 20, with production historically concentrated on fresh markets rather than processing. However, recent years have seen a marked decline in output, with 2024 yielding the lowest harvest in eight years due to severe drought, heatwaves, and escalating input costs. Seed prices have doubled, labor has become increasingly scarce and expensive, and cultivated areas have shrunk by over 50% since 2014 in some estimates. Climate variability has compounded these issues, leading to yield reductions of up to 40% in certain seasons. Consequently, domestic consumption, which remains high as potatoes are a staple food, has increasingly depended on imports, resulting in a persistent trade deficit. In 2021, for instance, imports surged to meet demand, while exports grew modestly from €1 million in 2014 to around €3.7 million.

Opportunities abound, however, particularly through investments like Grup Șerban’s. By shifting toward value-added processing, such initiatives can transform primary agriculture into a more profitable endeavor, creating jobs in rural areas and stimulating regional economic growth. The focus on local sourcing and shortened supply chains also addresses environmental concerns, reducing the carbon footprint associated with long-distance logistics in the European potato industry. This aligns with broader EU trends, where Eastern European nations are increasingly prioritizing agro-industrial development to compete with Western counterparts, who boast higher rates of value-added transformation. Successful agricultural clusters in other member states have demonstrated how integrated models can drive technology adoption, community engagement, and export competitiveness.

Beyond infrastructure, Grup Șerban Holding is fostering a « Sustainable Social Ecosystem » to empower local farmers. Launched in 2019, this program shares agro-food expertise, promotes skill development, and ensures a reliable supply of high-quality raw potatoes and vegetables. By integrating local producers into its network, the company mitigates supply risks, enhances product traceability, and contributes to sustainable practices that appeal to eco-conscious buyers. This community-oriented approach not only secures raw materials but also builds resilience in the regional agricultural fabric, echoing proven strategies in EU agricultural hubs that have spurred economic vitality and innovation.

In essence, this €62.5 million endeavor positions Grup Șerban Holding as a trailblazer in modernizing Romania’s agro-industry. It combines robust public support, advanced vertical integration, and a commitment to social sustainability to forge a resilient sector capable of thriving on both domestic and global stages. For farmers, agronomists, and investors alike, it exemplifies how strategic investments can navigate challenges, capitalize on opportunities, and elevate the entire value chain from farm to freezer aisle, paving the way for a more prosperous and self-sufficient agricultural future in Eastern Europe.