RSS
Twitter
Linked In
News In
News
Linked In
RSS
https://twitter.com/Agrimoney
http://www.newsnow.co.uk/h/Industry+Sectors/Agriculture

You are viewing 1 of your 2 complimentary articles.

Register now to receive full access.

Already registered?

Login | Join us now

Ekosem boost Russian milk sales, despite price slump

Twitter Linkedin

Ekoniva is boosting its milk production, and its profits, in Russia, despite the plummeting milk price.

Ekosem-Agar, the German-based holding company for Ekoniva, a dairy, meat and livestock company based in Russia, reported steady euro-denominated returns, and rising milk sales.

But the low milk price, and the cost of financing in Russia, are "weighing on the bottom line".

Stefan Dürr, Ekosem-Agrar's main shareholder and managing director noted the "extremely low global milk prices and the difficult financing conditions in Russia".

"The continued very low milk price and the relatively high rouble exchange rate in the first quarter additionally weighed on the bottom line," he said.

Rising output

Ekosem grew its dairy cow herd by 14% to 25,000 head, while annualised milk output rose by 17%, to 180,000 tonnes.

By growing output the company bucked a weakening trend in Russian dairy production.

The USDA expects Russian milk output to fall for the fourth straight year in 2016, down 45,000 tones to 29.980m tonnes.

This would be the lowest Russian production has been since the fall of the Iron Curtain.

Bottoming prices

Ekosem has had to contend with very low global milk prices over the period.

Prices on the Global Dairy Trade auction site fell by some 33% between March 2015 and March 2016, after bottoming out in the August of last year, then staging a slight recovery.

Milk prices have barely changed since that point.

But rouble-denominated milk sales were some 30% higher, despite the falling milk price, thanks to a "much higher milk output"

The company also increased its returns from crop and meat sales.

Steady sales

Across the group, sales in euros were steady year on year, at E98.1m, despite the decline of the rouble over the same period.

Adjusted for the rouble depreciation, sales were up 34% over the period.

Ekosem's earnings before interest, taxes, depreciation and amortisation (EBITDA) reached E56.6, ahead of forecasts of E50-55m.

But Ekosem's consolidated net income fell year on year, to E5.7m, from E17.2m million.

By Agrimoney.com

Twitter Linkedin
Related Stories

UN sees 'cereals boom' as it ditches idea of tighter world grain supplies

The all-important stocks-to-use ratio for world cereals will not fall after all in 2017-18, the UN FAO says, reporting an easing in food prices

Fonterra cuts milk price forecast, blaming 'strong' EU output

For New Zealand, Fonterra downgrades milk production prospects, while flagging strong demand from the likes of China

The Irish question: Farming in the Brexit battleground

With uncertainty surrounding the future of farming in Northern Ireland as it considers Brexit, the border implications and the breakdown of power sharing at Stormont, Alex Black spoke with farmers either side of the border to find out the practical reality.

Festive staff shortages 'likely' as British growers cut ties with UK supermarkets

Faced with mounting concerns over labour shortages and fears they may not be able to fulfil retailer contracts, some British growers have sought to cut ties with UK supermarkets in favour of companies elsewhere in Europe.
Home | About | RSS | Commodities | Companies | Markets | Legal disclaimer | Privacy policy | Contact

Our Brands: Comtell | Feedinfo | FGInsight

© Agrimoney.com 2017

Agrimoney.com and Agrimoney are trademarks of Agrimoney Ltd
Agrimoney is part of the Briefing Media group
Agrimoney Ltd is registered in England & Wales. Registered number: 09239069