KYIV. March 10 (Interfax-Ukraine) – Investment of private joint-stock company Lantmannen Axa Ukraine in modernization of a breakfast cereal plant in Boryspil has reached $15 million since 2000.
“Since 2000 we have invested $15 million in modernization of our enterprise,” Lantmannen Axa Ukraine Director General Ihor Chervak told Interfax-Ukraine.
He said that Lantmannen Axa Ukraine acquired a porridge packaging line for the plant, and a new packaging line in 2014. The AXA crisp muesli line and the START flakes line were installed.
Lantmannen Axa Ukraine bought Boryspil Foodstuff Plant in 2000. Its annual breakfast cereal production capacity is around 7,000 tonnes.
The company’s share of the breakfast cereal market in Ukraine exceeds 50%.
“The [breakfast cereal] market is narrowing. According to Nielsen research company, last year it declined 9%. Competition on the market has increased. Retail chains started selling product under private label,” Chervak said.
He said that in 2014 Russian products were removed from Ukrainian shelves, while Polish and Turkish food occupied the share of the Russian products. In addition, duties on products from the EU are falling after the Ukraine-EU Association Agreement took effect. If before the Association Agreement the duties on breakfast cereal reached 20%, now they are 4-6%.
He said that the company could invest in bread business in Ukraine in the medium term outlook.
“The Ukrainian bread market is a hot-button issue. We looked at several bread businesses here earlier that we could buy, but we took a pause now,” he said.
The company has a wide range of foodstuff. Imported products of total sales in Ukraine are less than 10%.
Lantmannen Axa Ukraine is a subsidiary of Scandinavian Lantmannen with four business divisions: food, machinery, grain trading and energy division. The key facilities of Lantmannen are located in the EU. The company sells flakes and muesli under the AXA and START brands, AXA bars, Masha and Bear ready to eat breakfasts and Finn Crisp bread.
