UKRAINE: Mondelez, Nestle battle over Ukraine market

By Eugene Vorotnikov | 24 October 2012

Mondelez International plans to expand its biscuit production in Ukraine, a move analysts believe is in response to Nestle's recent investment in the country.

Mondelez has announced the commissioning of a second biscuit production line for its Vedmedik Barni brand.

It will manufacture 6,000 tonnes per year at the company's Trostyanetskaya chocolate factory, joining a first biscuits line launched by the company in November 2011. The combined investment cost is US$36m.

A Mondelez spokesperson told just-food: "This year total biscuits production in Ukraine will amount to 20,000 tonnes, [and] during the next four years this figure should reach 40,000 tonnes."

Analysts at Ukrainian consulting agency AAA believe the expansion was prompted by Nestlé's plans to invest UAH244m (US$30m) expanding its Ukrainian confectionery business. It will modernise its Svitoch chocolate factory and installing new production lines. 

Maurizio Patarnello, CEO of Nestlé in Ukraine and Moldova, said the company's 2012 Ukraine investments are 60% higher than in 2011, adding that Nestlé's Ukrainian business grew faster last year than in any other European market - up 20%.

Sectors: Confectionery, Emerging markets, Snacks

Companies: Nestle, Mondelez International

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