Cherkizovo Group Received 1st Tranche of Compensational Subsidies
OREANDA-NEWS. August 12, 2013. Cherkizovo Group (LSE:CHE), the largest meat and fodder manufacturer in Russia, announced that it had received the first tranche of direct compensational subsidies for agricultural manufacturers.
Cherkizovo’s poultry factories and pork farms in various regions have already received the first part of the subsidies worth more than 100 million roubles.
“Allocating feed expense reimbursement subsidies for pork and poultry meat producers is a very important and well-timed action,” said Sergei Mikhailov, Chief Executive Officer of Cherkizovo Group. “Russian agricultural enterprises have been hit hard by high grain prices, which has also had an impact on the company’s financial performance. The subsidies will help us to cut losses. However, ongoing government support is needed in order to protect agricultural enterprises from natural risks and guarantee the country’s food security.”
Allocation of additional subsidies for agricultural enterprises was first proposed by the Government of Russia at the beginning of February due to the unprecedented rise in grain prices in 2012 and early 2013. It was announced that direct compensational subsidies of 9 RUR/kg for pork and 3.5 RUR/kg for poultry would be paid to manufacturers, based on actual production in Q4 2012.