Axzon A/S

completed

Axzon (the “Company” or “Sponsor”) currently has more than 30 pig production farms in Northwestern Poland and around 10 in Western Ukraine, a slaughtering and meat processing facility in Poland and a smaller specialty slaughtering facility in Denmark. The company also operates 8 biogas plants in Poland, and one in Ukraine as well as 10.000 Ha. of land in Ukraine and 13.000 ha. of land in Poland. The proposed project is to consolidate and expand the current production capacity with additional pig production facilities primarily in Ukraine. The large scale pig production facilities are relying on a mix of own crop production on partly owned and partly long term leased land and supplemental feed stock from the commodity market. The manure handling is partly through biogas digesters for energy production followed by storing in retention facilities with 9-12 months holding capacity followed by use as crop fertilizer through own use on leased cropland or through farmers off-take contracts.Especially in Ukraine the pig production facilities are relying on new crop farming based on re-farming of previously idle / brackish farmland that has often not been under commercial production since the cease of the Soviet farms in early 1990ies. By establishing the farms in the midst of these fields, it is possible to establishing a sustainable balance between manure produced by the pigs and the ammonia and phosphate fertilizer needs of the land farmed for crop production. In total, the Axzon pig farms in Poland and Ukraine has a sow population of around 28,000 sows and the farming area controlled is approaching 30,000 ha, thus with minor variations from farm to farm creating the needed land to animal hold ratio.The pig production facilities all consist of physically separated sections (sows w/piglet production sections, small (weaner) pig sections, finisher sections for pigs getting ready for slaughtering, and boar sections for sperm production), as well as feed mills and systems for manure handling in sealed lagoons (or tanks in a few cases) capable of holding the manure for twice yearly application as fertilizer on the crop fields. For some facilities the piglet / weaner production are located separately from finisher facilities to enable a more efficient piglet production. This also gives a better geographic distribution of the manure production to ensure the appropriate manure to crop production balance.Currently the project does not include any new slaughtering facility, with Axzon relying on local slaughterhouses for its Ukrainian production, but slaughtering facilities could be considered as the production expands. The primary market for the meat is the local markets in Poland and Ukraine.