Cherkizovo heralds benefits from Russia meat curbs
Cherkizovo forecast a fillip from Russia's curbs on meat imports as the chicken-to-sausages group heralded "strong" 2009 results, led by a 38% jump in pork production.
Cherkizovo said that Russia's drive to turn from the world's biggest global meat importer to self-sufficiency would stimulate a "positive pricing environment" for meat products.
A cut to Russia's poultry import quotas had already helped the Moscow-based group enjoy a 16% rise, to 74.33 roubles per kilogramme, in the average price of its poultry products last year.
Self-sufficiency drive
Yelena Skrynnik, Russia's farm minister, last week placed a deadline of three years on the country becoming self sufficient in poultry, and placed exports on the agenda within four or five years.
The drive, which is being accompanied by a succession of import quota cuts from 952,000 tonnes in 2009 to 550,000 tonnes in 2012, has alarmed many foreign producers, including the US, which has effectively been barred from the market.
Russia two weeks ago introduced a ban on meat processed with chlorine treatments, America's default method of cleaning poultry carcasses.
Russia has historically been America's main poultry export market, with trade estimated at $800m in 2008.
Capacity investment
Cherkizovo is undertaking considerable investment in raising production of pork and, in particular, poultry, with upgrades to egg production, raising and slaughter facilities.
Poultry output will be "significantly higher" from 2011, chief executive Sergei Mikhailov said.
However, production eased by 2,700 tonnes to 187,000 tonnes last year, because of a decision to lower the intensity of breeding operations as part of an efficiency drive.
A jump to 53,800 tonnes, live weight, in pork production reflected the ramp up of operations to full capacity at newly-built pork farms in Lipetsk and Tambov.
Market reaction
The statement was welcomed by Citigroup analyst Marat Ibragimov as signalling "strong top-line growth".
"The company beat our forecasts on pork and meat processing output volumes and slightly missed our poultry volumes estimates," said Mr Ibragimov, who has a target of $16.00 on Cherkizovo stock, and a "buy" rating.
"The aggregate top line looks to be in line with our forecasts and about 5% above consensus estimates."
The shares stood 3.8% higher at $13.75 in midday trade in London.
Other news
Cherkizovo Group top executives ranked best in agriculture
Kommersant business daily has released yet another annual Top 1,000 Russian Managers ranking compiled by the Russian Managers Association. This time, four Cherkizovo Group executives made it to the top: Oleg Zakov, Director at Cherkizovo Trade House; Irina Kim, Ready Meals Marketing Director; Natalya Klepikova, Head of Government Relations; and Evgeny Subbotin, Director for Procurement, Logistics, and Supplies.
Cherkizovo brand launches new specialty pork products
Cherkizovo Group, Russia’s largest meat producer, continues to expand the product portfolio of its flagship brand of the same name.
Cherkizovo Group outlines its role in climate agenda
Anastasia Mikhailova, Head of Communications at Cherkizovo Group, took part in an open conference on the role of climate regulation in the competitiveness of Russian agricultural products. In her presentation, she talked about the Company's contribution to reducing greenhouse gas (GHG) emissions.
Cherkizovo exhibits its products at Exchange Yard
Cherkizovo Group, Russia’s largest meat producer, took part in the Exchange Yard agricultural and machinery exhibition for the first time. We offered our best products for tasting and shared our plans to grow business in the region.