Business news from Ukraine


Shabo, a large Ukrainian wine manufacturer (Odesa region) on July 28 opened its third brand store in China, Fuzhou, the previous two working in Guangzhou and Xi’an.
According to the company’s website, the official store opened at the end of the previous month became the largest of the three stores. Shabo has been exporting its products to China since 2013. The first brand store was opened here two years ago.
“This is the third Shabo store with the products represented in China under the Master Tardan trademark, the previous two are successfully operating in Guangzhou and Xi’an,” the company said.
The new store in China has 240 square meters of stands with products, a wine storage, a tasting room, and office premises.
“This is the third store we’ve opened in three years and we plan to move forward at the same pace. I believe that by 2021 the Shabo brand store will open its doors to Shanghai residents as well,” Stanyslav Kobyletsky, the company’s export director, said.
The company noted that Shabo products are now exported to 18 countries of the world.
Shabo was established in 2003. The company is engaged in growing and processing grapes, production, and sales of alcohol products.
The company has been producing cognacs and brandy since 2005, and Shabo grape vodka since 2013. The manufacturing capacity of the complex, occupying more than 10,000 square meters, provides a full cycle of production of strong alcoholic drinks of grape origin.
The range of Shabo products is presented in all regions of Ukraine, as well as in Georgia, Israel, China, Poland, Latvia, Estonia, Belgium, France, Denmark, the Czech Republic, the United States, Brazil, Canada, Azerbaijan, Japan, Norway, and the United Kingdom.
The company owns processing capacities for the season amounting to more than 20,000 tonnes of red and white grapes. The Shabo vineyard covers a total area of about 10,000 square meters. Shabo produces 50 million bottles a year, with a total of about 80 items of products. Bottling is performed at nine filling lines.
Based on the state register of legal entities and individual entrepreneurs, the ultimate beneficiary of Shabo Industrial-Trade Company LLC is Eldar Iukuridze, Agrofirma Shabo LLC (both in Odesa region, the village of Shabo) Eldar Iukuridze and Bela Cholikidze.

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The European Business Association (EBA) has called to annul the excise label for wine, as it does not help to fight counterfeit products, while creates additional expenses for manufacturers, the press service of the association has reported.
According to the EBA, Ukrainian legislation requires the application of an excise label on all beverages with an ethyl alcohol content of more than 8.5% ABV. At the same time, wines with 1.2-15% ABV are subject to excise tax at a rate of UAH 0.01 per liter, while the value of the label is UAH 0.19 per piece. Alcohol importers also bear the cost of sending labels abroad.
“According to the calculations of the member companies of the association, there are UAH 278.6 of additional expenses per UAH 1 of the paid excise tax. Moreover, the major part of the sum does not go to the budget of Ukraine, but remains abroad,” the EBA said.
According to the EU regulations on labeling and protection of names of origin of alcoholic beverages, which Ukraine will have to adapt, beer from malt, grape wines, vermouth, cider and ethyl alcohol are not considered to be alcoholic beverages. Consequently, their quality control in Ukraine should not take place with the help of excise labels, but according to the general legislation on product safety, the EBA said.
“The products with alcohol content up to 8.5% ABV do not apply the excise labels. However, the safety control of such products is carried out. Therefore, it is reasonable to introduce the same logic for products with 1.2-15% ABV,” the EBA reports.
According to the press service, to abolish the excise labels, it is necessary to make changes to the Tax Code. “The business has already submitted the relevant proposals to the government. We hope that they will be taken into account in the near future,” the EBA said.

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Georgia exported 78 million bottles of wine from grapes (0.75-liter bottles) in January-November 2018, 11% more than in the same period last year, the Agriculture Ministry’s National Wine Agency reported. Exports in 11M are 1.7% higher than the total for 2017 as a whole, which was the highest annual mark in 30 years.
Georgia exported wine to 53 countries in 11M 2018. Revenue from the exports rose 19% to $184.1 million.
Russia was the leading importer of Georgian wine in the period, boosting imports 10.7% to 48.588 million bottles or 62.3% of the total. Other major importers included Ukraine – 9.5 million bottles, China – 6.3 million, Kazakhstan 3.4 million and Poland 3 million. Exports increased significantly to countries outside traditional markets: Japan, UK, Romania, Czech Republic, Netherlands, France, Germany, Canada and elsewhere. Georgia also exported 17.8 million bottles of brandy (0.5-liter bottles), 9% more than in 11M 2017, to 25 countries. Revenue rose 3% to $36.4 million.
Overall exports of wine, brandy and other products – chacha, other alcoholic beverages, wine materials and brandy spirits – were worth $281 million, 10% more.
Georgia exported 76.7 million bottles of wine from grapes in 2017, 50% more than in 2016. Exports to Russia rose 76% to 47.779 million bottles or 62.3% of the total.

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Chateau Chizay winemaking company LLC (Berehove, Zakarpattia region) in 2019 would boost wine sales by 15% compared with 2018, to 1.38 million bottles.
“In 2019, we intend to sell about 1.38 million bottles, despite the fact that the plans for 2018 are to sell about 1.2 million bottles,” Director of the company Anatoliy Poloskov told Interfax-Ukraine.
In 2017, the wine company grew and processed 1,500 tonnes of grapes, in 2018 it reached almost 2,000 tonnes. Due to the good yield, the company plans to sell some wine materials this year.
“Earlier, we didn’t have our own vineyards. We bought grapes in Odesa, Mykolaiv, Kherson, and Crimea, and produced and bottled 7-10 million bottles a year. Now we make wine exclusively from our own grapes, therefore, we have enough capacity,” Poloskov said.
At the same time, he said that Chateau Chizay faces with logistical difficulties due to the fact that the company’s two plants are located 25 km far from each other.
According to him, Chateau Chizay has 272 hectares under vineyards in three districts of Zakarpattia region.
He said that now the wine company is working on obtaining a land parcel.
Poloskov said that the company is mulling the possibility of resuming production of sparkling wine.
He said that 15% of wine is exported. The key markets are the United States, Canada, Australia and Israel.
“Today we are present on many continents. We also sent wine to Nigeria, but we don’t cooperate with the EU. Nobody is waiting for us there. I am talking about Ukrainian wines in general. Nobody wants us to bite off from their wine-making pie. And yet we now hope for Poland, we are actively working with it. We are mastering Asia, but so far there have not yet been supplies there. Also Sweden has become interested in our wine,” Poloskov said.



The share of Artwinery, a large producer of sparkling wine in Eastern Europe, of the Ukrainian sparkling wine market totaled 20.6% compared with 19.4% in 2016, the company has reported. “The volume of production of sparkling Artvineri over the past year amounted to 10.26 million bottles against 12.3 million bottles in 2016. The average annual volume of export sales of sparkling wines of the company is about 15% of the total figure,” Marketing Director of Artwinery Yevhenia Stadnyk told Interfax-Ukraine.
According to her, EU countries (in particular Germany), the CIS countries (Russia, Azerbaijan) and the countries of Asia are promising directions for the company’s export development.
The marketing director pointed out that the wine materials for the production of sparkling wines come to the enterprise from the wine-growing enterprises of the Odesa, Kherson and Mykolaiv regions. In addition, there are wine materials of the Crimean peninsula of the 2012-2013 harvest in the reserves of the enterprise.
“The entire production cycle is located at a depth of more than 72 meters in underground gypsum tunnels, which keep the temperature and humidity constant all year round. The total area of the underground galleries used by Artwinery is over 25 hectares,” Stadnyk said.
She said that until now, there is no need to count on restoration of the sparkling wine market in Ukraine to the indicators of 2013, when the volume was 69 million bottles. Artwinery seeks to strengthen its positions on the Ukrainian market and further expand export geography.

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