Svarog West Group Corporation Key performance indicators
About Svarog West Group Corporation
2003 Khmelnytskyi region
4,000 ha 200 employees Shepetivka Sugar-Mill JSC
2015 GEOGRAPHY ACREAGE PERSONNEL INFRASTRUCTURE
Khmelnytskyi region Chernivtsi region Zhytomyr region
80,000 ha 4,500 employees • Shepetivka Sugar-Mill JSC • Grain, legume, oil and special (niche) crops • Seed material production (seed plant) • Dairy and meat livestock farming • Horticulture • Products processing and storage • Modern MTSs • Agricultural machinery and equipment production • IT Projects • NFC juices production • Corporate Social Responsibility, Charitable Foundation
History The agricultural department was established on the basis of Shepetivka Sugar-Mill JSC to fulfill sugar production needs with its own raw material Intensive development of existing business directions
New business directions — dairy and meat livestock farming, MTS Svarog-2006 Corporation was officially registered on December, 27. The company incorporated 6 farms in Khmelnytskyi region Acquisition of farms in Chernivtsi region. New business direction — horticulture Strengthening of the Company's positions and territorial expansion. Rebranding of the Corporation. New name — Svarog West Group
History Development of the export program for own products. Production and recording processes automation on «1C 8» platform Launching of Company’s legal restructuring and international audit, adoption of IFRS (in partnership with Deloitte company)
The Corporation becomes Ukrainian leader in terms of yield indicators. Business expansion in Khmelnytskyi region
The most powerful in Western Ukraine seed plant, modern fruit storage, juice production line are set into operation The Company's business activity expands in Zhytomyr region. Storage facilities are increased. The second line of fruit storage with the capacity of 2.5 thousand tons is set into operation. Seed production is intensively developing. New business direction — agricultural machinery and equipment production Special (niche) crops production and processing program starts on a commercial scale. Svarog is a Ukrainian leader in terms of wheat, sugar beet and soybean yields, reaching 5% of Ukrainian soybean production market. On-line automated company management system is created According to «Forbes Ukraine» Svarog West Group topped the list of most efficient agricompanies of Ukraine. Corporation received certificate for exporting to China and became the first Ukrainian partner of the European Association «Danube Soya», which is focused on promoting non-GM soybean production. A new processing line for pumpkin seeds is set up. Leadership in winter wheat crop yield is maintained
Competitive Advantages Geographic location
Professional team
Effective implementation of agricultural technologies
Modern material and technical facilities
Diversification of production
Socially responsible business operations
Clear legal structure
High reputation of the Company
Geographic Location of Lands
Zhytomyr
Farm lands
Khmelnytskyi
Chernivtsi
Orchards
Georaphic Location of Lands LAND AREAS CLUSTERS
Slavuta
Chernivtsi region Shepetivka
Novoushitskiy area
Starokostyantyniv
Kamyanets-Podilsky Kelmenetsky area
Sokyryany area
Kitsman area KHMELNYTSKYI
Khmelnytskyi region
Georgaphic Location of Production Facilities
Seed plant Agricultural Machinery and Equipment Plant Livestock farms MTSs
Elevators
Vegetable storages Dairy farms Controlled atmosphere fruitstorages
Complexity of Agriproduction
Seed farms
Modern dairy farms
Nursery garden
Seed plant
In-house fodder base
Controlled atmosphere fruit storages
Elevators
Stud farms
Weather station
Modern MTSs
Waste products are used in organic segment of crop farming
Sorting line
Leading Inventory producers Export
NFC juices production Export
Svarog West Group Corporation Business Operation CROP FARMING Geography: Khmelnytskyi, Chernivtsi and Zhytomyr regions
Main crops: soybean, wheat, sugar beet
Land bank:
80,000 ha Crop production storage:
Niche crops: spelt, beans, mustard, pumpkin, oil flax
9 grain storage facilities with a total capacity of
350,000 tons Total harvest of main crops in 2015:
255,000
over tons (including 105,000 tons of soybeans)
Land Bank Dynamics in 2008-2015 CROP FARMING 80,000 ha 70,000 ha
51,000 ha
2008
53,000 ha
2009
55,000 ha
2010
2011
2012
2013
2014
2015
Total Yield of Main Crops in 2008-2015 2008
2009 2010
CROP FARMING
ths tons
ths tons
ths tons
ths tons
2011
ths tons
2012
ths tons
2013 ths tons
2015
ths tons
Yield Dynamics of Main Crops in 2008-2015 CROP FARMING 11.3
11.8
12.1
10.3
9.3
8.9 8.8
6.7 4.8 4.7 2.0 2008
4,6
6.4
6.1
6.3
2.6
2.6
3.0
2011
2012
5.0 2.5
3.8
2.9
0.8 2009
2010
CORN, Т/HA
*
WHEAT, Т/HA
*Corn wasn't planted in 2015
2013
SOYBEAN, Т/HA
2014
2015
Average crop yield of main crops in 2015, Ukraine vs Svarog West Group, t/ha 50.8 43.4
8.9 3.9
1.9
WHEAT
SUGAR BEET Ukraine
Svarog West Group Corporation
SOYBEAN
2.9
Annual precipitation level in 2015
Northern region (Shepetivka district, village Lotivka) – 451.6 Central region (Krasyliv region, village Zakrynychchya) – Southern region (Kelmentsi region, Dnistrivka village) –
mm
892.6 mm
590.4 mm
(Kitsman region, village Orshivtsi) –
430.6 mm
*According to the data provided by Hydrometeorological Center of Ukraine, the hydrological regime of Ukrainian waters in 2015 was formed under conditions of general precipitation deficit, starting from autumn 2014. The characteristic features of the hydrological regime was extremely low water spring floods, lack of rainfall flood (excluding only the second half of June and late November), long-term and very low-water period (starting from June till the end of the year) with the traits of hydrological drought. Weather conditions were recognized abnormal for this geographic zone in the history of meteorological observations.
*Source: Hydrometeorological Center of Ukraine
Crop Structure Dynamics in 2011-2015 CROP FARMING
65 ths ha
69 ths ha
80 ths ha 14.0 %
80 ths ha
80 ths ha 10 %
22.6 %
19 %
16.0 % OTHER CROPS
32.0 %
WHEAT
25,0 %
CORN
18.0 %
SOYBEAN
25.0 %
2011
35.0 %
22.0 %
16.4% 30.0 %
10.6 % 4%
19.0 %
25 %
46 % 40.0 %
46.4 %
2013
2014
24.0 %
2012
2015
SPECIAL (NICHE) CROPS
Seed Plant CROP FARMING
A new processing line for pumpkin seeds – 15 tons of seeds per day
Season work schedule Main crops July
Soybean Land preparation Fertilizing Planting Plant protection Harvesting
Wheat Land preparation Fertilizing Planting Plant protection Harvesting
Spelt Land preparation Fertilizing Planting Plant protection Harvesting
August
September
October
November December
January
February
March
April
May
June
July
August
September
October
November December
Season work schedule Main crops July
Corn Land preparation Fertilizing Planting Plant protection Harvesting
Sugar beet Land preparation Fertilizing Planting Plant protection Harvesting
August
September
October
November December
January
February
March
April
May
June
July
August
September
October
November December
Season work schedule Niche crops January
Beans Land preparation Fertilizing Planting Plant protection Harvesting
Pumpkin Land preparation Fertilizing Planting Plant protection Harvesting
Flax Land preparation Fertilizing Planting Plant protection Harvesting
February
March
April
May
June
July
August
September
October
November December
Agricultural Machinery and Equipment Plant SERVICE SECTOR
Capacity of electrical network
Siding rail
Total plant area
Production premises area 2 km
3.4 MW Drinking water
140,000
62,500
m2
m2
1,000 m3
Test run
MTS SERVICE SECTOR Own MTS service that consists of 4 regional subdivisions and has all the required infrastructure
Company’s technical personnel annually undergoes trainings on the plants of the manufacturers
Self-propelled agricultural machinery fleet
500 units 85% – machinery from the over
international manufacturers with a period of operation in the company of no more than 5 years
New project is launched in 2013: manufacturing of modern agricultural machinery, equipment, and information technologies on the basis of Agricultural Machinery and Equipment Plant
STORAGE FACILITIES SERVICE SECTOR Storage facilities are located in the area of ​developed transportation infrastructure (railway, highway) and arable land clusters
Argentine grain storage technology (silo bags) helps increase the storage capacity up to
500 ths tons
9 certified storage facilities with a storage capacity of
350 ths tons*
Certificated and accredited laboratories of cereal receiving stations *Storage facilities were certified for export to China
Partners COLLECTIVE ENTERPRISE “BILOTSERKIVKHLIBOPRODUCT” Location: Bila Tserkva, Kyiv region
Flour production plant Capacity of 500 tons/day
Products and services: • • • •
wheat flour semolina and buckwheat peas polished dietary supplements of wheat germ - "Oil", "Hlyukorn", "flakes" • feed for all farm animals, fish and poultry • storage and processing of grain
Buckwheat production plant Highest capacity in Europe - 360 tons/day Feed factory 240 tons/day
Wheat germ processing factory
Founded in 1910
Partners CROP SALES
80% of crop production is exported
Partners SEEDS, FERTILIZERS AND CROP PROTECTION PRODUCTS
Partners AGRICULTURAL MACHINERY AND EQUIPMENT
Svarog West Group Corporation Business Operation LIVESTOCK FARMING Geography: Khmelnytskyi, Chernivtsi and Zhytomyr regions
Cattle herd:
Strategic direction – dairy farming
14,000 heads
Pedigree cattle includes three Ukrainian highproduction cattle breeds, one of which is unique and is bred exclusively in Svarog's livestock complexes
Milk yield per one cow is
Dairy farms are certified as special raw material resources base for production of baby food Livestock farms are almost completely supplied by own fodder base
19-20
liters per 24 hours
Cattle Herd Dynamics in 2009-2015 LIVESTOCK FARMING
2009 2010 2011
ths heads
ths heads
ths heads
ths heads
2012 2013 2014 2015
ths heads
ths heads
ths heads
Dynamics of Cattle Herd Structure in 2010-2015 LIVESTOCK FARMING
YOUNG CATTLE
DAIRY COWS
CATTLE FATTENING
Beef Production Dynamics in 2008-2015 LIVESTOCK FARMING 2015 1,930 1,701
2014
1,671
tons per year 2008
1,288 1,537
1,394
2009
1,867
1,440
2010
2011
2013
2012
Milk Production Dynamics LIVESTOCK FARMING
Annual milk production yields:
2008
2009 2010 2011
Milk yield per one cow:
tons per year
2015
tons per year
5.57 tons per year
5.49
2014
tons per year
5.46
2012 2013 2014 2015
tons per year
tons per year
4
5.36
tons per year
2009
5.3
5.36
tons per year
2010 29,632
tons per year
2013
2011
2012
Partners LIVESTOCK PRODUCTS REALIZATION
ПП РЕНЕТ
Svarog West Group Corporation Business Operation HORTICULTURE Geography: Sokyriany and Khotyn districts of Chernivtsi region
Orchards acreage:
505 ha Seedlings: Supplied with planting material from its own nursery garden
Main orchard crops: apples, pears, stone fruits, berries Production: Juice production line wih capacity of
500 l/hour
Storage of production: Total harvest of apples in 2015:
16,600 tons
3 modern controlled atmosphere fruit storages with total capacity of
8,700 tons
Orchards Acreage Dynamics HORTICULTURE ORCHARDS ACREAGE
ha
ha
ha
ha
ha ha
ha
ha
SPECIES COMPOSITION OF ORCHARD AREAS fruitful apple tree
fruitful pear tree
84%
14%
stone fruit trees
2%
Apples Total Yield Dynamics in 2008-2015 HORTICULTURE 1,300 tons
2,600 tons
2008
2009
7,300 tons
2012
11,700 tons
2013
3,400 tons
2010
10,600 tons
2014
6,600 tons
2011
16,600 tons
2015
Season work schedule Horticulture January
Apple Protection against mice and hare Tree pruning Tying up trees Side dressing (NPK) Application of disease prevention products and pesticide (in 4-7 days) Foliar feeding Application of growth-regulating chemical Application of herbicide in near wellbore Harvesting of summer apples Apple sales Harvesting of autumn and winter apples Apple storage
February
March
April
May
June
July
August
September October November December
Season work schedule Horticulture January
Pear Protection against mice and hare Tree pruning
Tying up trees Side dressing (NPK) Application of disease prevention products and pesticide (in 4-7 days) Foliar feeding Application of growth-regulating chemical Application of herbicide in near wellbore Pear harvesting Pear storage Pear sales
February
March
April
May
June
July
August
September October November December
Corporate Social Responsibility
PERSONNEL
ECOLOGY
LOCAL COMMUNITIES
«Selection» of its own personnel
Crop rotation
Charitable Foundation
Safety of production
Education
Organic technologies
Health care
Cooperation with higher educational establishments Advanced Training Programs
Culture
Safety of labour
Sports, Parasports Immateriality Infrastructure Targeted social assistance
Charity
I II stage
stage
INTERACTION WITH LOCAL COMMUNITIES
2006 – 2010
– Social and Public Communications Department. Social Investments Program «With People and for People».
Total sum of investments into social sphere :
c. USD 2 mln
Since June 2010 – Strengthening Communities Charitable Foundation as a mean of interaction with local communities and social projects implementation.
21
towns
309 villages
Total sum of direct investments in 2010-2015 : over
regions
*USD 4.6 mln
Khmelnytskyi Chernivtsi Zhytomyr (*at current USD/UAH rate)
Implementation of innovations 1. Use of high-quality fertilizers with low level of carbon footprint to ensure the quality of plants treatment 2. Tailor made sowing technology for soybeans 3. Own designed and produced in partnership with European Company equipment to fulfill the new technology
4. Chemical analysis of soil for smart use of different chemicals and maintaining high quality of soil 5. Introduction of green energy projects: use of waste from crop farming to produce heat, electricity, organic fertilizers
6. Cultivation of crops with high energy potential 7. Application of organic fertilizers to reduce use of chemicals and increase quality of soil 8. Own developed IT software – Live AG
R&D Soybean production Company pays a lot of attention to soybeans as a core crop in its crop mix. Given this, significant efforts of the personnel are aimed at finding and choosing the best production technologies, the most yielding and high-protein varieties as well as necessary infrastructure to secure all stages of crop evolution Infrastructure • Trial plots and seed orchards (including those under irrigation) • Seed plant (preparing, processing of seeds and seed lots formation, equipment manufacturer ‒Cimbria) • Seed laboratory • Research laboratory • Breeding machinery (manufacturer – Sampo) Technological peculiarities • Own seeds treatment technology • Full scale usage of precision agriculture technologies, including: soil analysis, individual approach to each field, control of each production stage • Own technology of cultivation of commodity soybean: unique self-engineered sowing machine Prime Twin 3000 (produced in 2015) • Use of European mineral fertilizers produced by Yara
Breeding • Annual trials of 40 to 100 varieties of soybean on own trial fields • Selection of high-protein varieties of soybean • Cooperation with breeding centers from Austria, Canada, the USA • Annual renovation of seed line with high reproductions • Constant monitoring of know-how at different countries
R&D Soybean production To preserve the high quality of commodity, Svarog monitors all stages of production and carries out numerous laboratory tests – the synergy of scientific and practical approaches is reflected in leading positions in crop yields Production • Formation of new plan of strain renovation • Fields (including those under irrigation) • Sowing, production and harvesting machinery from leading manufacturers • Quality control and compliance with phytosanitary standards (GMO control on every stage of production process, determination of seeds quality profile on every stage of production process: preparing of seed material, growing, harvesting, processing, formation of commercial lots) on the basis of our own laboratories • Laboratory researches for determination of seeds condition, the effects of treaters, microelements, promoting agents and salts on the crop quality characteristics and structure analysis, determination of the dependence of changing of seeds sowing characteristics on the its storage duration time) • Processing and storage of commodity soybean in our own elevators (9 elevators, total capacity – 350 ths tons), equipped with up-to-date facilities
R&D Seed testing Svarog carries out own wide scale research to raise the efficiency of production and find the best varieties of seeds that will ensure high quality and rich harvest of crops. Company tests 100 varieties of soybeans and 90 varieties of wheat at specially dedicated land plots Research at soybean trial fields • Testing of soybean varieties (foreign selection) for the regions’ conditions • Influence of thousand-seed weight on growth energy, germination and soybean yield • Research on efficiency of applying various mineral fertilizing systems on yield and quality of soybeans • Efficiency of applying various protection systems (fungicides, herbicides, insecticides) on soybeans • Research on efficiency of applying growth regulators on productivity of soybeans • Research on efficiency of applying inoculation (various bacteria) on yield and quality of soybeans • Influence of seeding rate on yield and quality of soybeans • Research on soybeans sowing timing in the regions’ condition • Research on efficiency of applying biostimulators on soybean productivity • Use of mixes of regulators for seed treatment to improve the yield of soybeans
Research at winter wheat trial fields • Testing of winter wheat varieties (foreign selection) for the regions’ conditions • Use of mixes of regulators for seed treatment to raise the yield of winter wheat • Influence of seeding rate on yield and quality of winter wheat • Influence of sowing timing in the regions’ condition Laboratory research • Influence of seed damaging on sowing indicators • Influence of heterogeneous seeds on sowing indicators • Stillness of seeds during ripening depending on seed varieties • Research of factors that influence seed lifespan and longevity • Research of influence of various chemicals on seed energy and sprouting • Use of mixes of regulators for seed treatment to improve the development of root system
Business approach Svarog understands the importance and responsibility of large business related to communities, environment and, in case of agricultural company – human needs in food. Company’s motto – With people and for people - reflects those principles in the best way Innovations • Svarog is recognized as an innovative leader in Ukraine and invests significant costs and efforts in R&D • Svarog shares ideas of direct relationship of new technologies and human’s well-being. We see that our innovations create new working places, optimize efficiency of work and allow us to earn more, in turn giving more back to communities Environmental safety • Following the latest achievements of chemical giants (Bayer, Syngenta, Du Pont) Company applies user-friendly fertilizers to reduce the carbon footprint and CO2 emissions • Svarog’s own R&D led to production of innovative agri equipment that helps merging technological operations and reduce the use of fuel • Going forward Svarog plans to develop alternative energy projects to convert waste from agriproduction into heat and electricity
Research as a key growth trigger • Svarog sees research as a key enabler for the innovations, growth, prosperity and efficiency. We think that agriculture has to be innovative as well as other industries like chemicals, pharmaceuticals and IT • Svarog has separate research for the seeds – own seed plant and trial plots help to choose the best varieties, treatment technologies and sowing time to achieve high yields Sustainable development • Svarog adheres sustainable development principles and non-GM as well as organic farming. Company certified 10 thd ha with Danube Soya to confirm the sustainability of its products. At the same time Svarog is doing its best to work efficiently, ecologically-friendly. preserve integrity of production and support local communities through different programs
R&D Industrial facilities
Arable land
The First National Agricultural Cooperative
PARTNERSHIP PROJECTS Mission Improvement of well-being and living standards of every farmer, providing them the opportunity to realize their potential and to preserve Ukrainian land
Goal The revival of the villages through developing and implementing effective economic models, aimed at the production of high added value products by the small landowners with their further sale at market prices
FNAK indicators
ACTIVITIES OF FNAK
3 regions
•
Gathering of certain cultures and their primary processing
22 districts
•
Collecting and drying of fruits, vegetables, berries, seeds and mushrooms, etc.
•
Production of grain crops on profitable terms
•
Providing of cooperative members with seeds, agronomic support and guaranteed purchase of harvest
•
Development of livestock and poultry breeding
•
Organic certification of lands and products
300 villages 16,400 participants
PARTNERSHIP PROJECTS Main mission of «Live AG» is on-line agricompany management system in real-time • «Live AG» assumes: strict following of crop rotation schemes
• «Live AG» has a broad functional that covers all aspects of activities in agricultural company and consists of several main blocks:
reduction of emissions and use of chemicals with new machinery and equipment
chief agronomist’s module
individual approach to the each field and application of fertilizers and minerals according to the soil analysis
inventories and services tracking system
combining technological operations in the tramline to preserve the structure of the soil and its surface
online field condition monitoring system for sampling and soil analysis transport movement control system fuel consumption control system
PARTNERSHIP PROJECTS • The use of Live AG provided numerous benefits for the Company, simultaneously reducing the effect on the ecology: Reduction of CO2 emissions System of precise machinery handling Increasing the speed of cultivation, which reduces fuel consumption Fuel control system Reduction of fuel consumption as a result of monitoring fuel flows between fueling tankers and machinery together with the fuel control sensors installed on machinery/equipment GPS monitoring and control
Operational dispatch reduces machinery downtime Reduction of losses in soil fertility Implementation of innovative technology for soil cultivation Reduction in quantity of soil cultivation operations saves fuel and partially eliminates losses in soil fertility Improving the quality of soil using own mineral and organic fertilizers Developing of new compost production methods (from the livestock mould, chicken manure, waste of crop farming)
PARTNERSHIP PROJECTS Reduction of fertilizers and chemicals use System of aerophotography (online field condition control) Forecasting and preventing plants diseases Optimal and timely soil and/or foliar fertilizing Strict definition of germination phases for planning the use of pesticides and fertilizers
Differentiated pesticides application at the critical points of the field Laboratory analysis (soil, crops, mineral and organic fertilizers) Saving 10-26% of fertilizers Application of necessary fertilizers and chemicals based on agrochemical soil characteristics, field relief, and foliar crop diagnosis
PARTNERSHIP PROJECTS А3TECH IS YOUNG INNOVATIVE COMPANY WHICH HAS MANAGED TO GAIN A REPUTATION OF RESPONSIBLE AND PROGRESSIVE SUPPLIER OF HIGH-QUALITY AGRICULTURAL MACHINERY
А3Tech activities: – production of reliable, highly-efficient and functional equipment that perfectly fits for being used in soil-climatic conditions of Ukraine – high efficiency of agricultural machinery operation combined with its short cost recovery period allows to optimize operation of both large and small farming enterprises
– usefulness, ease of operation, multi-functionality and innovative focus of newly created machinery enables to meet the requirements of both farmers and agriholdings
PARTNERSHIP PROJECTS New unique production line of machinery for strip seeding of soybeans, corn, sugar-beet and sunflower has been developed:
Deep Tiller HERCULES
Pneumatic precision drill PRIME TWIN 3000
Spring-tooth harrow COMBER
Inter-row tiller FIGHTER
Agritechnica-2015 PARTNERSHIP PROJECTS Presentation of partnership projects of Svarog West Group Corporation and its partners A3Tech and LiveAG companies on November, 8-14, 2015 at the greatest Trade Fair of agricultural machinery, equipment and technologies Agritechnica-2015 in Hannover (Germany)
Agritechnica-2015 PARTNERSHIP PROJECTS Live AG has presented on-line agri-production management technologies which becomes possible due to use of precision farming elements, installation of specially-developed on-board computers and “Agro” software system. It allows to keep real-time record of all the operations which are performed at the holding’s capacities, track positions and movement of all types of vehicles, as well as to monitor the operation of fuel filling stations A3 Tech has presented innovative production line of machinery tested at Svarog West Group fields: Prime Twin 3000 seed planter, Fighter cultivator, Hercules deep tiller and Comber spring-type harrow. This machinery enables to seed agricultural crops under the original technology developed by Svarog specialists. This technology allows reducing fuel and CPP consumption up to до 30%, while increasing crop yield up to 23-25% in comparison with traditional one
About Svarog West Group Corporation: PRODUCTION – PROCESSING – TRADING The most efficient and highly technological company of Western Ukraine. Leader of Ukrainian market in terms of agriproduction. Business directions: Participants and key positions: • Crop production (land bank 80,000 ha): grain, legume, oil and special (niche) crops • Dairy and meat livestock farming • Fruit and juices production • Processing: sugar, flour • Seed production: modern seed plant, processing and sales of seeds • Modern storage: elevators and controlled atmosphere fruit storages • IT developments: on-line agricompany management system via complete automation of production processes and precision agriculture • «Green energy» and bio-production projects • Modern agricultural machinery and equipment production
• • • •
International Chamber of Commerce (ICC) Ukrainian Club of Agri Business (UCAB) European Association «Danube Soya» Norwegian-Ukrainian Chamber of Commerce (NUCC)
Website www.svarog-agro.com
WELCOME TO COOPERATION!