UKRAINE – Swiss food manufacturing giant Nestlé has halted the manufacturing and distribution of its products in Ukraine in the wake of a Russian invasion.
The Swiss giant, which has three factories and 5,000 staff in Ukraine said in a statement that it had “temporarily closed our factories, warehouses and supply chain” in the country.
The company further noted that it had advised all its employees to stay at home and follow the latest official guidance from the government and local authorities.”
“At this time, all our colleagues are safe and we remain in constant contact with them and are doing everything we can to prioritise their safety, adapting our plans in line with the changing environment,” Nestlé said.
“We remain committed to continuing to serve the local people and have contingency plans in place to ensure we can restart the supply of our products as soon as safe conditions allow.”
Nestlé sells a range of products in Ukraine, from confectionery and cooking products to infant formula and pet food.
The products manufactured at Nestlé’s three factories in Ukraine take in prepared dishes and cooking aids; confectionery; and beverages.
Elsewhere, Bonduelle, the France-based vegetables group, has also halted operations at a factory in Russia near the border with Ukraine.
Food prices set to spike following attack on world’s breadbasket
Russia’s attacks on Ukraine, once known as the breadbasket of the Soviet Union, could disrupt agricultural exports, and further increase wheat prices.
The two countries account for 29% of the world’s global wheat export market and over a fifth of corn exports originate from these countries.
Dawn Tiura, president at Sourcing Industry Group notes thatit’s not just the European Union that will be hit — many nations in the Middle East and Africa also rely on Ukranian wheat and corn, and disruptions to that supply could affect food security in those regions.
Wheat and corn prices were already soaring. Wheat futures traded in Chicago have jumped about 12% since the start of this year, while corn futures spiked 14.5% in the same period.
Per Hong, senior partner at consulting firm Kearney notes that Rising food prices would only be exacerbated with additional price shocks, “especially if core agricultural areas in Ukraine are seized by Russian loyalists.”
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