There is a distinct niche in the Ukraine milk market for premium organic milk, due to great dissatisfaction with the quality and image of the present supplies, some of which are often adulterated. CHOFU plans to convert, diversify and expand a conventional 3,200ha cereal farm to organic milk production over a five year period so as to capitalise on current and future market demand within the Ukraine. The farm is in Kharkov Oblast, located about 220 kilometres east of Kiev, on a 12 to 15 year -term lease, with an option to renew when the current lease expires, and options to expand to up to 30,000ha.
A combination of low-cost entry, sustainable and low-cost production, and high-tech breeding & disease prevention practices, driven by consumer-market needs, & led by a “Western” trained & experienced management team will give branded premium market prices and thus sustainable profits and competitive advantage to CHOFU.
The commencement can be immediate, as the current farm 3,200 hectare farm is available, and more land-leases are optional as required. There is a 3 year “window of opportunity”, due to WTO regulations, to start and build up milk production and processing facilities, and to develop premium milk-brands that earns loyalty from the target market consumers.
The purpose is develop an operational enterprise that generates high profits sustainably, by filling the consumer-market needs of middle- and upper-class Ukrainians, through quality premium branded products (68% of dairy needs of Ukrainian consumers is imported) that avoid the normal high volatility in “commodity agricultural products”, giving competitive advantage to Chofu Ltd. The establishment of a company that adds value and builds worth for its shareholders/ owners and is poised to grow organically, if/ when opportunities arise, is a linked aim.