Baltimor readies to streamline production

Related tags Sauce Ketchup

Leading Russian sauces manufacturer Baltimor is stepping
ahead with a programme to streamline its production facilities
following the announcement of a new vegetable oil processing
factory and the forthcoming completion of new facilities for
ketchup and juice production in St. Petersburg.

The company says that the new facilities in St. Petersburg, which have so far cost around $14.5 million, are due to start production in the course of this week. Once the facility gets into full production it is estimated that it will produce up to 200,000 tonnes of ketchup and tomato sauce from a total floorspace of 29,000 square metres.

A company spokesperson confirmed that the facility would produce Baltimor branded ketchup and tomato sauce, together with its Vosem Ovoshchei brand fruit juices.

The launch of production in St. Petersburg means that Baltimor will concentrate mayonnaise production at a leased facility on the outskirts of Moscow - a move that is expected to generate increased production efficiencies. As Russia's preferred condiment, the mayonnaise market is vast but still offers potential for further market consolidation as production is still fairly localised.

Meanwhile the company is also progressing with plans to develop the production of major ingredients used by the company. In June the company announced that it was increasing production of tomato paste at its factory in Uzbekistan. Additionally, at the beginning of this month the company also announced a project to construct a $10 million vegetable oil processing plant in an effort to increase its own supplies.

The vegetable oil facility will be located in Kalininsky, in the Krasnodar Region. It is expected to have a production capacity of 73,000 tonnes when it is opened in the first quarter of 2005.

Sourcing of primary ingredients is becoming increasingly important for the company as it continues to grow. Company director Milada Goudkova explained that the closer the ingredients suppliers are to the company's operations the more favourable it is with respect to logistics and cost savings.

Last week Tass reported that Baltimor's net profits for the half year had risen by 4.5 per to RUR64.02 million (€1.77m). The report also said that the company's revenues has risen 15.2 per cent to RUR1.55 billion.

The results are encouraging given that Baltimor, currently Russia's leading manufacturer of ketchup and mayonnaise, also had a bumper year in 2003, when its turnover increased 25 per cent to $91 million. However, the figure's might fall some way short of the manufacturer's aim to increase sales to $120 million for 2004.

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