Nestlé in Ukraine increased its production by 10% in 2024 and intends to repeat this growth next year, said Alessandro Zanelli, CEO of the company in Ukraine and Southeast Europe.
“Ukraine’s FMCG grew by just under 10% this year and demonstrated a strong focus on volume growth. This is a very clear sign of the resilience of the Ukrainian macroeconomy, which is hardly at war. Overall, the country’s GDP is quite resilient. We do not see the local currency, the hryvnia, collapsing. It is a steady controlled devaluation. At the same time, inflation is also relatively stable and under control,” he said at the NV conference ‘Ukraine and the World Ahead 2025’.
Zanelli noted that Nestle’s growth in Ukraine was at a similar level – just under 10% with an emphasis on volume growth, which can be estimated at 7-8%. The company’s CEO explained such indicators during the war as the result of the implemented strategy aimed at maintaining sustainability. The company’s team joined forces to protect its people, which allowed Nestle’s factories in Ukraine to continue operating even in Kharkiv. Being under constant shelling, this company also found an opportunity to increase productivity, the CEO explained. He noted that Nestle’s strategy in Ukraine also focuses on adaptability at all levels: from responding to changing consumer trends and adjusting the product portfolio and their locations to changing the timing of promotional activities and transforming communications to bring more hope and make products relevant to consumers.
Zanelli assessed the results of Nestle’s work in Ukraine as satisfactory and expressed confidence that in 2025, even taking into account possible difficulties, production growth will be similar – at least 10% per year.
The company’s CEO predicts that in the second quarter of 2025, Ukrainians and the FMGG segment will face rising inflation, which will lead to a significant rise in food prices. In addition, the shortage of skilled labor will increase. He also sees the cost of electricity as a challenge for the coming year. Zanelli said that the probability of the war ending, which the whole society is waiting for, is a possible “white swan”.
“In general, we remain optimistic, as I said, and expect about 10% growth,” Zanelli stated.
He also explained the postponement of the launch of the new plant in Volyn region from December 2024 to January 2025 by various elements of disruption, including the increase in air raids and the availability of people. At the same time, the top manager assured that the launch will take place, for which the company, along with recruiting specialists living in the region of the plant’s construction, is relocating staff from Kharkiv.
Zanelli emphasized that the location of the new plant next to another plant (Torchyn, Volyn region – IF-U) is the intention to create a food production center near the border with the European Union. The products produced by the new plant will be exported by 80%. In the domestic market, the company will increase its presence and market share through supplies from other companies.
“Usually, to make a business attractive, we first improve its efficiency and then immediately reinvest back into efficiency to grow and increase market share. It is extremely important for us to have an additional plant in Ukraine (…) We as Nestle understand that the war will end. It is too easy to come and invest on the first day after the war ends. For us, the moment of investment has come now, so we are planning for the future,” summarized the CEO of Nestlé in Ukraine.
Nestlé started its operations in Ukraine in 1994 with the opening of a representative office, acquired a controlling stake in Lviv Confectionery Factory Svitoch in 1998, and has owned 100% of the company’s shares since 2018. Nestlé’s business in Ukraine is represented by the following areas: coffee and beverages, confectionery, cooking (cold sauces, condiments, soups, fast food), baby and specialty food, breakfast cereals, and pet food.
Nestlé in Ukraine intends to commission a new factory in Smolyhiv (Volyn region) in the fourth quarter of 2024, in the construction of which it has invested $45 million, according to a release from the company’s press office in Ukraine.
“The new factory will become part of a culinary production hub and will produce products, including those for export to the EU (…). The opening of the factory is scheduled for the fourth quarter of this year – on the 30th anniversary of Nestlé’s work in Ukraine,” the release said.
According to the report, in the first half of 2024, the company completed a number of construction works, installed some equipment, and continued to expand its green electricity generation capacity. In particular, a 500 kW solar power plant was installed, and another 700 kW is planned to be added in the near future, after which solar power plants will be able to provide 18% of the factory’s electricity needs.
In addition, the company is in the process of recruiting employees for the new factory: the company has already hired more than 100 people and opened the same number of vacancies. Prior to the opening of the factory, 300 jobs were created, and their number will continue to increase. The company continues to invest in its existing factories in Ukraine and provide Ukrainians with food. In the first half of 2024, the company maintained sales growth in Ukraine, focusing on adapting to the growing needs of consumers for basic food products. Nestlé in Ukraine has reformatted its product portfolio and adjusted production plans of its factories to meet demand.
At the same time, Nestlé Ukraine increased exports to European countries by 30% in 2023. With the opening of the new factory, it is planned to increase exports to the EU countries and thus support the process of European integration of the Ukrainian food industry.
The spokesperson reminded that Nestlé in Ukraine has invested more than $100 million in the Ukrainian economy over the past 10 years.
“The company will continue to invest in its production sites in Ukraine and support 5500 Ukrainian employees,” Nestlé Ukraine assured.
Nestlé started its operations in Ukraine in 1994 with the opening of a representative office, in 1998 it acquired a controlling stake in CJSC Lviv Confectionery Factory Svitoch, and since 2018 it has owned 100% of the company’s shares. In May 2003, Nestlé Ukraine LLC was founded in Kyiv, and at the end of that year, Nestlé became the owner of 100% of Volyn Holding.
Nestlé’s business in Ukraine is represented by the following areas: coffee and beverages, confectionery, cooking (cold sauces, condiments, soups, fast food), baby and specialty food, breakfast cereals, and pet food.
Switzerland’s Nestlé, the world’s largest producer of food and soft drinks, has launched the announced construction of a plant to manufacture pasta and other food products in the Smolyhiv village, Torchyna district, Volyn region. Earlier the company invested CHF40 million (nearly $45 million) in the project, business.rayon reported.
Alessandro Zanelli, general director of Nestlé in Ukraine and Southeast Europe, expressed confidence Wednesday at a ceremony marking the start of construction that the plant in Torchin will become a European regional hub for the culinary category.
“I’ve seen Ukrainian cities that were destroyed after all kinds of attacks and how they were rebuilt within a year. The Ukrainians are working successfully to rebuild the infrastructure. Of course, we are calculating the possible risks, but we are confident that we are doing the right thing. Ukraine is worth investing in,” said Marco Sattembri, executive vice president of Nestlé and chief executive of the European zone.
It is specified that at the first stage of work the enterprise will create 300-400 workplaces. Specialists from Kharkov, where there is already a factory producing instant noodles “Mivina”, and local staff are involved in the work at the plant.
Nestle is one of the world’s largest food producers, headquartered in Vevey, Switzerland. The company has 376 factories in 84 countries and produces chocolate and confectionery products, ready-made breakfasts, pet food, baby and medical food, coffee, mineral water, etc. Its portfolio includes more than 2 thousand brands, including Nestle, Nescafe, KitKat, Gerber and Maggi.
Nestle in Ukraine produces coffee and beverages, confectionary, culinary products (cold sauces, seasonings, soups, instant food), baby and special food, ready-made breakfasts and pet food. The most famous Ukrainian brands of the company are Svitoch, Torchin and Miwina.
As reported, in December 2022, Nestle announced its decision to open the production of “Mivina” in Volyn.
Swiss-based Nestle, one of the world leaders in the production of food and beverages, has provided Ukraine with CHF15 million ($15.8 million at the current exchange rate) in the form of humanitarian and monetary assistance since the beginning of the military invasion by the aggressor country of the Russian Federation, which included financial assistance and over 40 million servings of food, drinks and nutrients.
The relevant data was made public in the report of the corporation for the first quarter of 2022 on its website on Thursday.
“From the very beginning of the war, Nestle has focused on supporting its employees, their families and the people of Ukraine. Working in partnership with Ukrainian charities, Nestle also organized direct humanitarian deliveries in the war zone,” the report says.
According to its data, the corporation was able to largely maintain operations in western Ukraine, while the work of its plant in Kharkiv was stopped due to heavy shelling of the city by Russian troops. The enterprise was transformed into a distribution center for humanitarian aid for the local population.
The corporation has retained wage payments for its 5,800 Ukrainian employees, and also provides them with advance, lump-sum payments in connection with the relocation.
“Nestle has set up support centers in neighboring countries such as Poland to receive employees and their families who have left Ukraine. For example, part of the company’s factory in Rzeszow (Poland) was converted into housing for refugees,” the corporation said in the report.
As reported, on March 23, the corporation decided to reduce production and sales in the aggressor country of the Russian Federation to essential goods, such as baby or medical food.
Nestle Corporation starts selling a line of Garden Gourmet plant-based products in Ukraine, resembling meat in taste, appearance and texture.
The company’s press service reported on Thursday that the Garden Gourmet product line is represented in Ukraine by Sensational Burger, Sensational Sausage, Vegan Meatballs and Vegetarian Nuggets.
The press service of Nestle told Interfax-Ukraine that the new products will be delivered to a number of restaurants in Kyiv and Lviv, and the Garden Gourmet line will arrive in the retail network at the end of 2021. At the same time, the selling prices of new products are not disclosed.
The company said that Garden Gourmet products consist of natural plant ingredients, and the dye in plant products is beet juice and fruit and vegetable concentrate. The product also contains wheat, soy, oil and water. According to Nestle, the shell of Sensational Sausage uses natural algae.
According to the company, the production of vegetable burgers requires 80% less energy compared to a similar meat product. Also, the production of Garden Gourmet products reduces the carbon footprint and land use compared to the meat product by 80% and 75%, respectively.
“The choice in favor of plant products helps to reduce the amount of greenhouse gases in food production. Thanks to the optimal price, this product is affordable for everyone, and we hope that Ukrainians will discover the world of plant foods thanks to Garden Gourmet,” Nestle Professional Business Executive Officer in Ukraine and Moldova Elena Shevelyova said.
According to the company, Garden Gourmet is a popular plant food brand in Europe, with production facilities in the Czech Republic.
Nestlé, one of the world’s largest food manufacturers, has announced the launch of a product line in Ukraine in partnership with the Starbucks brand.
“As part of partnership between the two companies, a line of coffee for making at home has been launched on the Ukrainian market,” the company’s press announcement said.
According to the report, on January 15, Nestle will announce the details of partnership with Starbucks and its plans to develop the coffee business in Ukraine as a whole.
Currently, coffee under the Starbucks brand is already present in Ukraine both on the largest marketplaces and in niche online stores, and in large retail chains such as Silpo or Metro, and belongs to the upper segment with a price of about UAH 100 per 100 g.
