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The egg manufacturing company and egg-based products AS Balticovo expects a decline in its turnover this year compared to 2017, said the chairman and co-owner of the board of Balticovo, Valdis Grimze, in an interview with LETA.
He recalled that the year 2017 had been a great success for the company, as producers from other countries were facing various problems, including the spread of bird diseases, which had resulted in a shortage of animals. eggs on the market. The price of products manufactured by "Balticovo" grew in deficit and the company used it successfully last year to increase its turnover. However, this year, the eggs are surplus and poor harvests of cereals lack quality. As a result, Balticovo will have to look for them not only in countries other than Latvia, but also to buy higher quality, more expensive cereals.
According to Grimz, for the above reasons, the company's results this year are not as bright as a year ago. "The decline in sales is already being felt now because sales prices are much lower, they are actually back to 2016," said Grimze, pointing out that cereal prices are higher than expected. 39, about 30%.
Tomas Auskaspis, board member of Balticovo, added that the tensions related to overproduction of eggs have now decreased, as European producers, seeing that products from other countries arrive on their markets, ask themselves if they wish to work at their maximum capacity. Last year, however, egg producers were keen to optimize their production capacity because egg prices rose due to a deficit and their offer did not allow to cover the request. "All the European producers have tried to put all the peat bogs to their maximum capacity, so the supply has exceeded the demand," recalls Auskas.
Grimze added that there is a worldwide demand for quality eggs at affordable prices. Since these criteria can be fulfilled by "Balticovo", the sales figures of the company outside of Europe have not diminished. "We are no longer [cenu svārstībās] as easy as ever, and we are proud of it. We are going to the European markets, we are looking for new markets in Europe and Southeast Asia. For example, we have already harmonized certificates in Hong Kong. We also work in South Korea and in other directions, "he said.Last year, the company started to actively work on the sale of products in South Korea, another shopping region of Southeast Asia.
"It is not so easy to enter a market in another country.First, normal countries protect our market." As an outstanding example, I can mention the United States, which at the time had an egg deficit due to the outbreak of bird flu. They turned to Europe, especially to help us. What was needed to import products into the United States took place in two weeks. It's very fast because they need it. In the case of Hong Kong, when we want to enter our market, the procedure is considerably more difficult and longer, "he said.
Grimz added that shipping to Southeast Asia and distant Asia would take about 50 days and that shipping products could be a challenge due to limited lead times. As a result, the Company will likely export high value frozen products, including frozen liquid egg products, such as egg cultures or egg yolks with special properties, such as eggs, eggs and eggs. a gluten-free pancake mix that does not contain lactose either, as a large part of the Asian population does not tolerate it.
LETA has already announced that the Balticovo business turnover amounted to 52.3 million euros in 2017, an increase of 17.3% over 2016, while the profit of the company was up to 10.8 million euros, four times more than in 2016. a year
The main business of "Balticovo" is the production and sale of chicken eggs, egg powder, liquid liqueurs to eggs, boiled eggs without shells, d & rsquo; Chopped and cooked eggs. The main owner of the company is BCO, which holds 95.42% of the shares.
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