Consolidation of the meat industry during a crisis will solve a number of problems

Consolidation of the meat industry during a crisis will solve a number of problems

Today Ukraine faces a crisis, the consequences of which cannot be fully predicted, but it is obvious that it will affect all economic processes and citizens’ social status. Food production is also undergoing structural changes: consumer behaviour changes, buyers become more price-sensitive, and some distribution channels, such as markets or HoReCa, are cut off or narrowed down for an undefined period.

This is indicated by the Association of Meat Industry.

The Association of Meat Industry was one of the first to respond to the market challenges. The organization has set its strategic objective to consolidate the industry by providing livestock complexes and meat processing enterprises with effective mechanisms for reducing the cost of finished products, optimizing organizational and logistic processes. The conflict of interests of meat-producing companies in the new economic reality must be eliminated, all key market players agree.

The movement towards vertical integration of the meat industry – from breeding and slaughtering animals to creating the final product – will solve a number of pressing problems and tasks in Ukraine:

– prevention of price increase of products, broadening the accessible range of meat products on store shelves;

– strengthening the country’s food security;

– saving and creating new jobs at all stages of the chain from field to table;

– technological development of the industry, introduction of leading world experience and practices;

– increasing the export potential of the meat industry while the annual global pork deficit is over 10 million tons;

– increase of budget revenues;

– development of modern agribusinesses, infrastructure of villages and small towns;

– creation of predictable and transparent investment projects for raising capital in the agricultural sector;

– raising the prestige of working in animal husbandry, achieving job compensation competitive to one offered by the companies in the EU, through the use of effective process management systems.

The newly elected executive director of the Association of Meat Industry is Mykola Babenko, one of the leading experts in animal husbandry, the general director of the private enterprise as well as same-titled NGO, Centre for Improvement of Animal Breeding, who will be responsible for the development and implementation of the new strategy in the Association.

«Crisis times are indeed very stressful. However, it is the crises that have at all times given impulses for profound changes, clearing the economy and individual businesses from outdated, inefficient and harmful processes. According to our estimates, pork producers alone overspend over 8 billion UAH annually. These losses directly affect the cost of the pork and make it a rare product for Ukrainians. Now, with a catastrophic decline in purchasing power among the population, we are facing a threat for the industry itself, industry itself, together with national hog production, jobs etc. So the transformation is urgent. Consolidated meat companies must have a high level of integration, automatization, eliminate corruption, use leading technological solutions and systematically assert their interests at the state level in order to save the consumer and develop. We know how to achieve this, we have the technology and access to the best experts. I am glad that together with the partners of the Association of Meat Industry, we equally evaluate the market prospects and the changes it needs», – Mykola Babenko comments.

«Today, meat processing companies do not have the best of times, with all market participants more or less experiencing a negative impact on business. It is possible to continue as it is and to observe how Ukrainian producers increasingly lose to imports and leave the game. Or, we can jointly create the preconditions that will allow us to work transparently and profitably, offer quality products at an affordable price, and find new markets. We have invited Mykola Babenko to the management of the Association of Meat Industry, as we are well aware of his active position in the advocating the interests of meat producers and share his views on reducing the production costs and doing business effectively and responsibly», – comments Oleksandr Skoryk, Head of the Council of the Association of Meat Industry.

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