July 23, 2012

Ukraine's MHP reports better financial performance

Despite declining production, Ukrainian poultry producer, Mironivsky Hliboproduct (MHP), has reported better financial performance.


MHP said that, in the first half of 2012, it reduced production of finished meat products to 16,510 tonnes, a 4.6%, or 790 tonnes drop compared to the same period in 2011. Volume sales of poultry also declined by 0.3% to 181,600 tonnes.
However, the company forecast an increase in profitability due to higher prices in the domestic market.



According to estimates from the company's experts, the price of finished meat products in the Ukraine increased by 15.4% to US$2.69 per kilogrammes (excluding VAT) in the first half of 2012, up from US$2.33 per kilogrammes in the same period in 2011. The price of chicken increased by 27.5% to US$2.11 per kilogrammes compared to first half of last year.



"Consumer demand for poultry meat has remained high throughout the first half of the year, and the company sells about 100% of its production. Also, the volume of exports of chicken meat has continued to increase momentum in the first half of 2012 and reached almost 20,000 tonnes, which is 30% higher than in the first half of 2011," said a spokesperson.



MHP's performance reflects the situation in the whole meat and poultry industry in the Ukraine. According to official statistics, meat production in Ukraine in January-June 2012 decreased by 1% compared with the level of January-June 2011, to 1.437 million tonnes. However, a systematic crisis at the beginning of the year and rising grain prices meant that meat prices have increased by an average of 18% since the beginning of the year.



"In such a situation, large agricultural holdings like MHP receive a large benefit, because all the company's businesses have closed production cycles and its own feed mills, meaning they are less affected by the situation in the grain market," said experts at the Russian analytical agency, Agrorucom.