"Ukrkondprom": sweets producers suspend production of part of the range due to extremely high gas prices

Dec 23 2021

Such a statement made by the President of the Association "Ukrkondprom" Alexander Baldynyuk.

He reported, what 22 December, the price of gas on the stock exchange has already crossed the line 73 th. UAH. Due with this, some companies in the industry have already informed the Association about the plans in full or partially curtail production.

«Кондитерські підприємства вже кілька місяців балансували на межі рентабельності через надвисокі ціни на газ та зростання вартості всіх інших складових собівартості продукції. After all, the price of gas this year has been growing every month since January, when its cost to manufacturers was 5,9 thousand UAH. Last month, manufacturers bought gas on average at close prices 40 thousand hryvnias and already at such its cost production of many products was unprofitable, and performance previously signed contracts were unprofitable for the industry. In December suppliers offered gas 55 per thousand. hryvnias per thousand cubic meters,  at which to sell products for economically reasonable prices would already be very difficult. And at the cost of gas for production needs 73 th. UAH. for a thousand cubic meters it is easier for confectionery companies to fold at all production, after all, at this cost, the product will not be in demand at home, nor in foreign markets ", – explained O. Baldynyuk.

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Foreign Ministry helps Ukrainian companies sign three confectionery contracts as part of business mission to Saudi Arabia

Dec 17 2021


15 December Ukrainian confectionery producers - "Kharkiv Biscuit Factory", Lviv Chocolate Workshop and Grona visited the Kingdom of Saudi Arabia on a business mission.

During the visit, three Ukrainian producers signed contracts with well-known local companies to export their products to Saudi Arabia and other countries in the Gulf region.

About this reported Minister for Foreign Affairs of Ukraine Dmytro Kuleba.

The business mission was organized by the Ministry of Foreign Affairs of Ukraine together with the Ukrkondprom Association with the assistance of the Embassy of Ukraine in the Kingdom of Saudi Arabia to meet with local importers and distributors of food products.

"Ukrkondprom": consumers overpay for confectionery products at least 15-20% due to the government's failed energy policy

Nov 30 2021

Such a statement made by the President of the Association "Ukrkondprom" Alexander Baldynyuk.

He reported, that for several months food producers have been forced to buy gas at a price, which exceeds 30 thousand UAH. for a thousand cubes, що призводить до суттєвого зростання вартості продуктів на внутрішньому ринку та падіння конкурентоспроможності української продукції на зовнішніх ринках.

"In the food industry is used only approximately 6% of total consumption gas, therefore, the government has the ability to curb rising food prices products, to the value of which the most vulnerable socially vulnerable groups people. For example, the Government of Poland, to overcome the effects of high inflation country, developed a number of measures in the energy sector, including reductions VAT rates on gas from 23% before 8%, and excises will be completely abolished and reduced VAT on electricity, which will lead to a significant reduction in energy costs for consumers. In addition, close 5 millions of Polish households have to receive payments in size 96-275 dollars to support families in the face of rising food prices food", – said O.Baldynyuk.

In Ukraine g, in his opinion, the government is not paying enough attention to the energy crisis.

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Rising energy prices have led to higher production costs

Nov 25 2021

- Most Ukrainian companies do not have long-term contracts with gas suppliers. The resource has to be bought monthly at stock prices. In particular, in October, the cost approached 40 thousand hryvnias per thousand “cubes”. In November, the average was close 33,5 thousands, - tells 51Annual Alexander Baldynyuk, President of the Association “Ukrkondprom”.

- The practice of forward contracts is widespread in the European Union. Producers can order a certain amount of gas at a certain price. It is selected and paid for gradually over the course of a year. In Ukraine, to book a certain amount of gas per year, you must make the full cost in advance. Then pay for storage in warehouses. A medium-sized confectionery company uses approximately 300-600 thousand cubic meters of gas per month. During the heating season, the need increases even more.

Rising energy prices have led to higher production costs. Previously, the share of gas in products was tentative 4 interest. Now - 10-15, depending on the product. The biggest price blow was suffered by the flour confectionery group - cookies, cakes, biscuits. They are baked in gas ovens. In addition, increased the price of packaging on 15 percent. Tara added 38 interest, flow - 6, alcohol and condensed milk - 3 interest.

Difficult situation with sugar. This is one of the main ingredients for confectionery. It has doubled in price over the last year. Increasing the cost of gas will add to the cost of sugar even more 40 percent, according to manufacturers.

The decline in production at most confectioneries has been going on since the beginning of the year. The rise in prices for raw materials affected, energy resources. Manufacturers try to work even with negative profitability, to stay in the market, save volumes, staff and commercial relations. In addition, most companies have long-term obligations to customers. And they must fulfill them, in order not to receive penalties. It is therefore important, that the government find a way out of the situation even before that, as businesses begin to wind down. After all, after the stop, it will not be easy to resume work. At the same time, the same gas and sugar in Poland cost less. Loans are more affordable. Our companies have already started to lose competition to foreign manufacturers. This year, imports grew by more than a third. Further increase in prices for confectionery will only complicate the situation.

The full text of the article can be found at the link: https://gazeta.ua/articles/money-newspaper/_sob-teplicyam-vitrimati-ovochi-povinni-podorozhchati-na-120-vidsotkiv/1060899

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