Amidst the bustling atmosphere of the IDMA Expo in Istanbul, Rodion Rybchnskyi, Director of Union Millers of Ukraine, shared valuable insights into the challenges gripping the industry back home.
Mr. Rybchnskyi, can you tell us about the current challenges facing Ukrainian millers?
One of the significant challenges we face is the occupation of about 25% of Ukrainian territory, where many flour plants were located. This has had a notable impact on flour production volumes in Ukraine. Additionally, there has been damage to Ukrainian energy infrastructure due to ongoing attacks by Russia, with recent data indicating that about half of our energy capacity has been destroyed or affected by missile strikes. This directly impacts our flour and pasta producers, particularly the bakery sector, which requires uninterrupted electricity supply.
How has logistics been affected by the conflict?
Logistics have been severely affected by the situation. The Black Sea ports, vital for our exports, have been blocked, leading to a loss of control over several ports. Consequently, due to the maritime blockade of Ukrainian ports, flour is exported through EU ports, primarily Romanian ones. This shift in logistics has significantly increased production and transportation costs.
What steps are Ukrainian flour companies taking to adapt to these challenges?
To meet the quality standards of the European Union and overcome logistical hurdles, Ukrainian flour companies are prioritizing the modernization of their production processes. Moreover, the issue of human resources has become critical due to conscription, immigration, and the displacement of people within Ukraine. This has prompted us to focus on automating our flour milling plants to compensate for the decrease in the workforce.
Can you provide insight into the current state of flour production in Ukraine?
Before the conflict, Ukraine produced approximately 2.1 million tons of flour annually. However, due to the occupation and subsequent destruction of flour plants, production has decreased by about one-third to around 1.5 million tons. Flour milling companies located on the frontline have been particularly affected, with six plants completely destroyed and two out of every ten plants partially damaged by missile attacks.
What are Ukrainian delegates hoping to achieve at IDMA Expo?
We arrived at IDMA with a delegation of approximately 20 millers from Ukraine. Ukrainian delegates are keen on exploring new equipment and technologies to enhance their flour milling operations. Specifically, we are in need of packaging systems, loading and unloading systems, automation systems, as well as flour analysis and quality control equipment. We are also interested in fostering partnerships with Turkish milling equipment producers, envisioning cooperative programs such as leasing arrangements with favorable financial terms. It’s worth noting that the current income levels of Ukrainian millers are not comparable to pre-war levels, making such collaborations crucial for our industry’s recovery and growth. Overall, the challenges facing Ukrainian millers are multifaceted, but we remain determined to adapt, modernize, and collaborate to ensure the resilience and sustainability of our industry in the face of adversity.