Delta Wilmar CIS celebrates the completion of the sunflower seed crushing plant construction
On January 30, 2014 there had been finished the ceremony devoted to the finish of the sun flower processing plant building Delta Wilmar CHS LLC. The plant capacities allow to process nearly 1200 tonnes of oil seeds daily. Note up to 2013/14 MY Delta Wilmar was in top list of the largest Ukrainian traders of sun oil, and now the company will be able to provide its buyers with the own production veg oil.
Thus the transportation, reloading and processing of the non-refined tropic oils complex of Delta Wilmar CHS in cooperation with the plant of the sun seed processing in Yuzhny to unite their efforts and double the contribution into the stable development of the fate-and-oil industry of Ukraine. Thus the Chairman Director of Delta Wilmar CHS LLS Dhruba Charan Panda has agreed to tell about the company and the current project in particular.
- First of all we would like to greet you with the finish of the plant building and putting it into operation. Please tell when did you decide to build own plant on the oilseeds processing? What difficulties did you face while realizing the project. What were the positive moments?
The idea has appeared just before the putting into operation of the tropic oils processing plant. Our company almost at once started to sell sun oil to Asia owing the advantages on the transportation, because we import palm oil and tale sun oil on the way back.
The difficulties were bureaucratic ones, but still we handled them.
- The location of the oil processing enterprise is profitable owing the possibility of exports of sun oil and meal. And how do you estimate its location on the raw-material purchasing?
Of course Odessa region is the deficit one due to the low crop of sun seed in comparison with the current capacities of the sunflower processing. It is obvious it is more profitable to process sunflower in the region of its production due to the sunflower lower specific wight in comparison with its by-products. So it is more profitable to transport by-products than the sunflower. But we have the obvious advantage of the fixed costs because the plant is the part of the common industrial complex.
- As far as it is known your company started purchasing the 2013 crop sun seeds in the beginning of the season. Did you face the raw-material supplies deficit (sun seed) while forming the necessary volume for the plant putting into operation?
It was the first season of the storing for our company. Of course we faced the competition but I think we were lucky with the season. The crop in Ukraine and in Odessa region faced the record volumes.
- The plant is able to process sunflower, soybean, rapeseed and do you plant to expand that list?
Sunflower and rapeseed. The positive partial of such chance is the flexibility of the making the decisions depending on the market conjuncture. We will watch it and are going to start rapeseed processing this year.
- It is very important to have the stable supplies of the raw-materials. What kind of purchasing of the raw-material do you prefer in the prospects? Is it forward purchasing, the agricultural producers investment or other?
It is the priority task of our enterprise to provide the stable supplies of our plant with the raw-material. Unfortunately the practice of the forward supplies of sunflower in unpopular in Ukraine. There are certain reasons of it. But we are ready to develop such form of cooperation with the stable agricultural producers the same as to provide our suppliers with the loans on the certain conditions. But still we prefer to purchase sunflower on SPOT.
- Will Delta Wilmar CHS LLC decrease the sun oil purchasing on the domestic market due to the starting of own enterprise?
We provide our clients with the Ukrainian and Russian sun oil. In 2013 our trade turnover of sun oil on the world market exceeded 800 thsd tonnes. The planned production of sun oil is 170 thsd tonnes on our plant and we plan to increase it to 1 mln tonnes.
- During the recent few years the volumes of processing capacities face an increase in Ukraine owing the high demand on the Ukrainian products on the world market. What countries are the most prospective for Ukrainian sun oil exports?
These are developing countries with the improving commonwealth. These are Asian and Middle East countries, and also Africa.
- Do you face any competitiveness on the market of palm oil though you are the largest importer?
Despite we are the leader on the market of palm oil supplies to Ukraine we face competitiveness all the time.
- The margarine products market is rather stable in Ukraine. What is your estimation of the market? How do you estimate the dynamics of production of margarine products in Ukraine in the recent three years? Are there any problems with the quality?
The margarine products production has been faced the stable increase of 2-3% annually in the recent years. As for the quality issue it is necessary to note two moments. First is the margarine products realization in 2013 which was complicated due to the ban imposed by the sanitary service of Russia on the imports of the products of the confectionery plant Roshen and other ones. The production volumes and the demand for raw-material changed. But after the problem was solved the enterprises activity resumed its previous volumes. Note the products of our company are being produced according to the European quality demands. The world demand faces an increase.
- What will be the further prices development on the crude sun oil export market?
The sun oil prices is being correlated with the soybean oil prices. The sun oil has to remain competitive in comparison with the stated product. Thus soybean crops in Argentina and Brazil to be well this year so the market will be pressured by it. The soybean oil price to total 800-840 USD/t FOB Argentina, meanwhile sun oil price on the FOB Black Sea basis to be at the premium of 15-20 USD/t for soybean one. So the sun oil price to reach nearly 820-860 USD/t.
- How do you estimate the impact of the current economic situation and the currency movement on the oilseed industry of the country?
We consider the current economic situation in the country to have the negative impact on the oilseed industry due to the loans getting more expensive or complications while trying to get it. Also the national currency movements to cause losses for market participants using the foreign currency loans and getting the most part of profit while selling the products on the domestic market.
- Since the beginning of autumn there has been talks about the new investment project of Delta Wilmar CHS LLC. We would be grateful to you for sharing the information on what will your new plant process/ produce?
We plan to produce not only food products but also the oleochemical products as soap flakes, fatty alcohols and other.
- Traditionally in order to finish our conversation what is your wish for market participants?
We would like to wish the market participants the hold and firmness herein the hard times.