Business news from Ukraine

LAW ON PRINCIPLES FOR ORGANIC PRODUCTS PRODUCTION AND LABELING COMES INTO EFFECT IN UKRAINE

President of Ukraine Petro Poroshenko has signed the law on basic principles and requirements for organic production, circulation and labeling of organic products, the presidential press service has said. According to the report, the implementation of the norms of the law will ensure the improvement and harmonization of the Ukrainian legislation with the legislation of the European Union in the sphere of production and circulation of organic goods and will help create transparent business conditions, reduce unfair competition, increase the competitiveness of domestic organic products and expand foreign markets for its sale.
The law establishes the basic principles and requirements for organic production, circulation and labeling of organic products, the basis for the legal regulation of organic production, the circulation of organic products and the functioning of the market of such goods. The legal basis for the activity of central executive authorities, the subjects of the organic products market and the direction of state policy in these areas are also defined.
As reported, the Verkhovna Rada on July 10 at second reading and as a whole adopted law No. 5448-d on basic principles and requirements for organic production, circulation and labeling of organic products. Some 237 people’s deputies voted for the document with the quorum being 226 votes.

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PEPSICO CONSIDERS TO PLACE PRODUCTION OF LAY’S CHIPS IN UKRAINE

PepsiCo Ukraine, one of the largest producers of food and beverages, is considering the localization of production of Lay’s chips. “PepsiCo Ukraine to further meet the demand of consumers is working to improve the efficiency of work. Localization of production is one of the ways. To this end, we are studying and analyzing the Ukrainian agrarian sector, its potential,” the press service of the company told Interfax-Ukraine.
PepsiCo produces chips under the Lay’s brand in Poland. PepsiCo in Ukraine owns five enterprises: a plant for processing fruits, vegetables and juice production (Mykolaiv region), a plant for production of juices, carbonated drinks and cold tea (Mykolaiv region), Kharkiv Dairy Plant (Kharkiv), Kyiv Dairy Plant (Kyiv region), where Agusha baby food factory, launched in 2012, is also located.

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UKRAINE TO KEEP STEEL PRODUCTION IN AUGUST AT 1.8 MLN TONNES LEVEL

Ukrainian metallurgical enterprises intend to keep steel smelting in August 2018 at the level of planned indicators of July, at 1.8 million tonnes. According to the Ukrmetalurgprom association, the plan for August also provides for the preservation of total rolled steel production at the level of 1.6 million tonnes and keeping pig iron smelting at the level of 1.8 million tonnes.
According to its data, in June cast iron production totaled 1.63 million tonnes (103% compared to May 2018), steel production was 1.71 million tonnes (101%), that of rolled products some 1.52 million tonnes (98%).
In January-June 2018 production of iron ore concentrate stood at 30.22 million tonnes (99.5% compared to the same period in 2017), agglomerate at 15.43 million tonnes (106%), pellets at 10.63 million tonnes (109%), coke at 5.37 million tonnes (106%), pig iron at 10.15 million tonnes (108% taking into account the work of enterprises in the temporarily uncontrolled area and 114% without taking them into account), steel at 10.39 million tonnes (101% and 106% respectively), rolled products at 9.25 million tonnes (105% and 110% respectively), and pipes at 544,000 tonnes (109%).
“Despite the loss of part of the capacity in the uncontrolled territory, an increase in production of main types of goods was observed in the six months of 2018 compared to the same period in 2017. This became possible due to stabilizing the supply of iron ore raw materials and coke to the enterprises, as well as commissioning blast furnace No. 3 at Zaporizhstal after reconstruction,” the report says.

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CHINESE MANUFACTURER INTERESTED IN JOINT PRODUCTION OF ELECTRIC BUSES IN UKRAINE

Chinese manufacturer of dual-layer capacitors Shanghai Aowei Technology Development Co. is interested in creating a joint production base for manufacturing electric buses at the Chernihiv Automobile Plant (ChAZ) of the Etalon Corporation, the press service of the Chernihiv City Council has informed. Representatives of the Chinese company met with city mayor of Chernihiv Vladyslav Atroshenko last week, prior to visiting the Chernihiv trolleybus management company for the general condition of the enterprise, trolleybus depot and networks, as well as the Chaz to study its capabilities to create a base for the production of electric buses.
Representatives of the Chinese company noted that they have similar successful experience with Belarus.
According to the message, a representative of the company Hua Lee noted the potential of the ChAZ to create such a base and said that soon negotiations would be held with the management of the plant to make a final decision on joint production. “We did not come here to sell you electric buses; we want to introduce our technologies together with the local manufacturer. We would like to create a production base, as we did it in Belarus,” the press service of the City Council quoted Hua Lee as saying.
Atroshenko, in turn, expressed interest in attracting lending from China, including the creation of the necessary infrastructure for electric buses.
Shanghai Aowei Technology Development intends to send a group of designers to Chernihiv in late July and early August to research the existing contact network and the state of public transport, then provide reports and options for resolving these issues in a comprehensive manner. Shanghai Aowei Technology Development is an export-oriented enterprise specializing in the development, manufacture and sale of electric double-layer capacitors and ultra capacitors which was established in 1998. They are used in the construction of electric motors and other electronic equipment for electric buses. It exports its products mainly to Asia.
ChAZ produces buses of various modifications on the chassis of Indian TATA and Ashok Leyland, including school buses. In addition, the plant has established the production of trolleybuses.

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REGAL PETROLEUM SEES 58% RISE IN PRODUCTION IN Q2 2018

Regal Petroleum Plc with assets in Ukraine in Q2 2018 increased average daily production of gas, condensate and LPG at the Mekhediviska-Golotvshinska (MEX-GOL), Svyrydivske (SV) and Vasyschevskoye (VAS) gas and condensate fields by 58.6% or 1,045 boepd, to 2,829 boepd.
The company reported on the website of the London Stock Exchange (LSE) on Wednesday, average daily production of gas, condensate and LPG from the MEX-GOL and SV fields for the period from 1 April 2018 to 30 June 2018 was 281,599 m3/d of gas, 55.4 m3/d of condensate and 27.5 m3/d of LPG (2,220 boepd in aggregate).
Average daily production of gas and condensate from the VAS field for the period from April 1, 2018 to 30 June 2018 was 86,728 m3/d of gas and 6.2 m3/d of condensate (609 boepd in aggregate).
At the VAS field, the VAS-10 well has reached a depth of 3,380 metres, where drilling has been concluded. Subject to successful testing, it is intended to hook the well up for production testing by the end of the third quarter of 2018.
In addition, the company said that At the MEX-GOL and SV fields, workover operations are underway on the SV-12 well. This well is a suspended well owned by NJSC Ukrnafta. The company has entered into an agreement with NJSC Ukrnafta under which the company has agreed to workover the well, and if successful, gas and condensate produced from the well will be sold under an equal net profit sharing arrangement between the company and NJSC Ukrnafta.
At 30 June 2018, the company’s cash resources were approximately $40 million, held as $15.9 million equivalent in Ukrainian hryvnia.

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KYIVSKY CARDBOARD PAPER MILL SEES 18% RISE IN PRODUCTION IN 2018

Kyivsky cardboard paper mill (Obukhiv, Kyiv region), a leader in Ukraine’s pulp and paper industry in terms of production and sales, produced goods worth UAH 2.149 billion in January-May 2018, which was 18.4% up year-over-year. Thus, production in the first five months of 2018 somewhat slowed compared to the same period last year (production growth in January-April was 26.7% and in January-March 30%), the UkrPapir association said.
Corrugated packaging output grew by 11.2%, to 93.5 million square meters, which was the second highest result among producers of corrugated packaging in Ukraine after Rubizhne cardboard packaging mill in Luhansk region (with Trypilsky packaging plant).
Production of cardboard increased by 15.7%, to 85,400 tonnes. Production of package cardboard alone grew by 31%, to 58,900 tonnes, while box cardboard output fell by 8.2%, to almost 26,550 tonnes. However, production of base paper (for sanitary products) stood at 31,500 tonnes, which was the same as a year ago. Toilet paper output grew by 7%, to 174.9 million rolls. Corrugated packaging output in total in Ukraine (including other producers) grew by 8.4% January through May 2018, to 416.94 million square meters, that of paper and cardboard increased by 12.5%, to 395,650 tonnes.
Kyivsky cardboard paper mill is one of the largest cardboard and paper producers in Europe. It employs almost 2,200 people. It sells produce to almost 700 companies in Ukraine, some CIS member states and the rest of the world. In 2017, the mill saw a 14.8% rise in production from 2016, to UAH 4.85 billion.

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