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"U.S. CHICKS TO INVADE UKRAINE"
By VASYL SHCHUR
Kyiv Post Staff Writer
The Kyiv Post
Friday, June 14, 2002
Ukraine's embargo on U.S.-grown poultry may have a silver lining.
U.S. poultry producer Cobb-Vantress is expected to make cash and in-kind
investments totaling nearly $100 million in a joint venture with Agromars, a
major Ukrainian poultry firm.
Cobb, which is based in Siloam Springs, Arkansas, and has subsidiaries in
Brazil and Europe, is involved in the development of breeding chickens for
the world market. In promotional literature, the company claims that 48
percent of the broiler chickens sold worldwide come from Cobb-Vantress
breeding stock.
In January, Ukraine barred the import and sale of poultry originating in the
United States, citing concern with the safety of antibiotics and feed
additives. Though Russia imposed and later dropped a similar ban, Ukraine's
is still in effect, depriving the nation of a major source of imported
poultry meat.
Although an Agromars official denied that Cobb's investment is linked to the
import ban, the partnership will likely modernize Ukraine's poultry business
and could take the country from being a net importer of poultry to becoming
a significant exporter.
Under the agreement, Cobb's European subsidiary will supply breeder chicks
to Agromars, Ukraine's largest poultry producer. Those chicks are expected
to form the foundation for improved poultry production.
Agromars' Havrylovska Poultry Farm, located in Kyiv Oblast, will see the
first evidence of the joint venture.
Agromars officials said the company plans to establish an Eastern European
farm center that will supply chickens for consumption in Ukraine and export
to Belarus, Russia, Poland and Turkey.
In addition to raising chickens for meat production, the firm says the
hybrid fowl will be available for sale to competitors. Agromars said that
breeding chickens fetch between $30 and $40 each on the world market.
"We will sell chickens to other farms and produce poultry products of our
own in Ukraine," said Mykhailo Ivanov, head of production at the Havryloska
farm.
Making room for all those chickens will require the renovation of other
Agromars facilities in the villages of Zhukyn and Lubyanka, located north of
Kyiv. In all, 23 barns will be equipped to hold 38,000 chickens each. The
barns will be outfitted with equipment made in Germany and Italy.
Cobb-Vantress personnel will train Ukrainian workers to use the new
equipment.
"Our battery farms will be absolutely new for Ukraine," Ivanov said. "They
will be sterile and be climate-controlled."
Ivanov also said that the hybrid birds will receive specially formulated
feed.
Agromars will spend $8 million to revamp the aging building.
Agromars said it expects to grow 2 million chickens annually by 2004, and 10
million per year by 2005.
Ivanov said the company plans to produce and process 50,000 tons of poultry
meat by 2003, a significant increase over the 25,000 tons the company will
produce this year. By 2004, Ivanov said the company's goal is to produce
100,000 tons of processed meat.
Ukraine currently produces 124,000 tons of poultry annually, according to
State Statistics Committee data.
Before U.S.-grown chicken meat was embargoed, the country imported 69,000
tons of meat each year, of which about 90 percent originated in the United
States.
But Ivanov said that the investment by Cobb-Vantress isn't a signal that the
Americans have abandoned hope of having the import ban lifted. Instead, he
said, Cobb wants to help build Ukraine's poultry production from the ground
up.
http://www.cobb-vantress.com
http://www.cobb-vantress.com/cvi/history.asp
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