EU poultry and egg markets open to Ukrainian producers as of Feb. 20

The European Commission adopted regulations allowing Ukrainian companies to supply poultry and eggs to the EU, Interfax reported on Feb. 20. In early December, the European Commission’s Food and Animal Health Committee voted to include Ukraine in a list of countries eligible to supply poultry meat and other poultry products to the EU. At that time, Ukraine’s Veterinary Service estimated the EU market would be open to Ukrainian producers in two to three months.

Alexander Paraschiy: While the news itself contains no surprise, we believe it will encourage international investors to turn more attention to Ukraine’s publicly traded producers of chicken and eggs, namely MHP (MHPC LI), Avangard (AVGR LI) and Ovostar (OVO PW). Recall, each of these three producers has ambitious capacity and production expansion plans for 2013. The newly opened market for their products will serve to slightly ease oversupply of chicken and eggs in Ukraine. We do not expect significant sales of poultry products to the EU market this year, but we believe it could become critical for the companies’ further capacity and sales expansion strategies.