McCain is putting plans for a new French fry plant in Mehrum, Lower Saxony, on hold for the time being. The food company had intended to invest up to one billion euros at the site of the former coal-fired power plant, a project expected to create up to 650 new jobs. However, rising project costs, overcapacity in the European potato processing sector, and weaker demand have altered the financial outlook. Federal and state authorities had mobilized around 60 million euros in funding support for the venture. Consequently, the decision means the region loses one of the largest industrial investments announced in recent years.
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McCain Responds to Changing Market Conditions
The company had re-evaluated the project’s economic viability and subsequently decided against building the factory as originally planned. In addition to higher investment costs, the group cited weaker demand for processed potato products in Europe.
However, plans for Germany have not been completely abandoned. McCain continues to view the German market as significant and intends to explore alternative investment opportunities. Nevertheless, the billion-euro investment originally announced is off the table for the time being. Consequently, the up to 650 jobs that the new plant was set to create will not materialize.
Around 60 million euros in funding did not alter the financial equation
The project had garnered significant political support. Lower Saxony helped secure approximately 50 million euros in federal funds, and another ten million euros from state programs were also on the table. Yet, this funding evidently proved insufficient to offset the shift in economic calculations.
The plant was slated for construction on the site of the former Mehrum power station. Coal-fired power generation there ceased in 2024, prompting policymakers and local authorities to seek new industrial uses for the area; consequently, the french fry factory was viewed as a key element of the region’s structural transformation. It now remains unclear what major industrial operation might utilize the site in the future.
Potato farmers also lose a planned major buyer
The decision, however, affects more than just the labor market. The plant would have required vast quantities of potatoes, thereby creating additional sales opportunities for farmers in Lower Saxony. Some growers had already entered into discussions regarding supply contracts, and preparations for organizing the regional supply of raw materials were already underway.
For this very reason, the impact of halting the project extends far beyond Mehrum. Agriculture, logistics, and other service providers stood to benefit from the new factory. Although McCain cites market conditions and cost factors as the primary reasons for its withdrawal, the region is nonetheless left with a multi-billion-euro investment gap.
Billion-euro project intended to revitalize former power plant site
The site was initially considered favorable. Located along the Mittelland Canal, the property boasts an industrial history and existing transport links. However, issues with contaminated soil complicated preliminary work. That said, McCain does not cite these legacy environmental issues as the decisive reason for the project’s current halt.
This marks the end—for the time being—of one of the Peine district’s greatest hopes for attracting new industry. A project involving an investment volume of up to one billion euros and 650 planned jobs will not go ahead as intended. While McCain could potentially return later with a revised concept, the French fry factory originally announced will not be built in its planned form.
Author: Blackout News
Sources: Top Agrar (03.10.26) – Hildesheimer Allgemeine Zeitung (01.10.26) – t-online (01.10.26)