the go-ahead to begin exporting to those same countries, plus Morocco and the Philippines,” Palamar stated. Ukraine exported 107,500 tonnes of eggs in 2017, up by 21% compared with the same period in the previous year, Palamar noted, citing data from the State Statistical Service. In mone- tary terms, exports jumped 37% to US$ 94.1 million. The top three biggest sales markets were the UAE with a nett worth of US$ 34.5 million, Iraq with US$ 19 million and Qatar with US$ 9.7 million. The positive dynamics in egg exports acceler- ated in both 2018 and 2019. “In the first half of 2019, Ukraine exported 75,400 tonnes of in-shell eggs, 69% up compared with the same period in the previous year,” Palamar continued. Ukraine has managed to establish well diversified egg exports with most eggs being supplied to the Middle East and North Africa, and most eggs products going to the European Union. “In monetary terms export is growing more slowly than in physical terms. This can be attributed to some growth in the share of liquid egg production in overall sales. The main sales markets for egg products of Ukrainian origin in 2018 were the EU countries, which accounted for nearly half the total sales volume, the MENA countries and Southeast Asia. Anastasya Skibchuk, senior analyst at the Kiev-based think tank Pro Con- sulting told Poultry World that the top five sales markets for Ukraine egg products are: Denmark, Italy, Saudi Arabia, Latvia and Indonesia. “The growth in production is largely deter- mined by the demand in markets outside Ukraine, since do- mestic demand is projected to grow at a slow pace given that
the purchasing power of the local population remains largely unchanged,” Skibchuk added.
Shrinking margins Despite the strong and continuing growth in production, the biggest egg producers in Ukraine have seen their margins falling. Research conducted by the Ukraine Antitrust Commit- tee in 2018 showed that the three biggest companies, Avan- gard agricultural holding, Ovostar Union and Inter Agrosila, jointly accounted for 46.61% of the country’s sales of egg and egg products. Ovostar Union saw its net profit fall by 81.1% to US$ 2.6 mil- lion in January-September 2019 compared with the same pe- riod in 2018. Revenue decreased by 18%, to US$ 77.63 million, which was due to lower egg sales and negative price dynam- ics in the reporting period. Ovostar Union reported that eggs sales in Ukraine had dropped by 15.9%, to 888 million eggs, compared with the same period in 2018. Egg production dur- ing this period decreased by 0.9%, to 1.191 billion eggs. “The supply currently exceeds the demand. Right now, this is the main challenge facing the Ukrainian egg industry. Egg pro- duction in Ukraine has grown in recent years, while the de- mand from both the internal and external markets remained flat. In this situation, margins have shrunk to a minimum and operational effectiveness has become the key to maintaining the business,” Anna Tews, chairman of PR department of Ovostar Union told Poultry World.
▶ POULTRY WORLD | No. 2, 2020
Ukraine is a true champion when it comes to egg production but oversupply has put price levels under pressure.
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