Tuesday, March 4th, 2014
Seoul, Korea - Dongbu Group will take its hands off of the agriculture business it has begun in 2010. It was a decision based on the judgment that it has become almost impossible for the group to continue its glass greenhouse business of growing tomatoes in the face of fierce opposition from farmers' associations accusing Dongbu of intruding into the business area reserved for small-scale farmers.
Dongbu Farm Hannong, the seeds and pesticide company under the umbrella of Dongbu Group, said on March 3 that it would sell off a glass greenhouse facility in Nonsan, South Chungcheong Province, following the disposal of the Hwaseong greenhouse last year. The company will also give up its pursuit of acquiring a license to grow crops in the reclaimed land of Saemangeum in the west coast. With this announcement, Dongbu Farm Hannong will end up folding all agricultural businesses after four years.
In 2010, Dongbu Group began its ambitions as a farm goods producer by being selected as an operator in the Saemangeum Reclamation Project. It then took over a small glass greenhouse company in April 2011, followed by an acquisition of Asia's largest greenhouse facility in Hwaseong at the cost of 46.7 billion won. The group was going to export all its tomato output from the greenhouses to Japan.
But farm interest groups protested against the company's decision in February last year, arguing "a large company is jumping into the business of growing tomatoes and trying to starve all tomato farmers." In the following month, Dongbu Group declared that it would stop the business entirely.