Ukraine’s largest producer of eggs, Avangard, has began a major asset restructuring, Forbes.ua reports.
The head of the company providing raw materials for Avangard recently said that from the beginning of the year, the company had significantly reduced the volume of purchase of raw materials as several poultry farms had been closed. This information was confirmed by a former top manager of Avangard, who recently left the company.
Forbes notes that Avangard began to close poultry farms at the end of last year, and in January 2013 this process has gained momentum. By January 29 at least four poultry farms were shut down. These are South Holding Poultry Farm (Crimea), Chervony Prapor Farm (Luhansk region), Lozuvatskaya Farm (Dnipropetrovsk region) and Interbusiness Farm in the Donetsk region.
The former top manager of Avangard said that still it is not clear how large-scale restructuring will be carried out: “The final decision about enterprises is still pending. Anyway, the reduction of production capacities will not be sharp, so there will be no market fluctuations.”
According to Forbes.ua a number of other enterprises including several feed mills, chicken rearing areas and warehouses will also be closed.
In response to the claim, Avangard commented to World Poultry that “the company is not closing poultry farms but on the contrary manages its production capacity effectively placing hens in the newly introduced and most efficient facilities in the first order. Avandgard utilises its production capacities in accordance with its map of homing of poultry flock and operational plans. As a result the redistribution of the resource base (laying hens) does not impact the Company’s operational figures, such as production volumes and total poultry flock.
“The capacity redistribution will not result in any additional costs to the Company or changes in the operational performance. The company is continuing to operate according to its stated goals and maintain the leadership in the production of shell eggs and egg products.
“Whilst hens are moved into the new facilities several poultry farms will indeed be dormant to undergo necessary sanitary procedures before another hen placement takes place.”