Blitz interview with Stefan Duerr, President of EkoNiva Group

Publications,

DairyNews Information Agency, 20.03.2017

Stefan Duerr, owner and founder of one of the largest milk producing companies in Russia told The DairyNews about the group’s plans with regard to milk processing and shared his views on the development and governmental support of milk production.

DN: When are you planning to start producing cheese in Voronezh?

SD: I do not know yet. We need to decide on the product range and production technology. Currently, we are on the stage of market research and information collection. We cannot speak of any definite timeframe until we complete this stage. Nevertheless, we have already hired part of the staff for cheese production.

DN: Why did you choose the processing capacity of 30 tonnes?

SD: To make sure that the production is successful and the technology is right. We have planned this cheese plant as an experimental facility, to develop the technology and learn how to produce and sell cheese. If everything goes well, we can think of producing larger volumes.

DN: Does the government of Voronezh oblast support your idea to start cheese production?

SD: They support our milk production sector on the whole, and the cheese-making facility is an integral part of the dairy project.

DN: Are you planning to expand your dairy product range?

SD: We will probably add some new positions. It is very important to us to develop our Academy of Dairy Sciences brand and make it recognisable and popular with young people. The next stage is entering supermarket chains.

DN: What do you think of the prospects of Russian dairy products export?

SD: How can we speak of export with the self-sufficiency level of 70% and an ongoing decrease of milk production? It is clearly a long-term task.

DN: What ese are you planning for the current year besides construction of the dairy in Aristovo?

SD: We have started constructing a similar dairy in Voronezh oblast and another one in Novosibirsk oblast.

DN: Will you continue the construction in case of CAPEX delay?

SD: I have told you that I am risk taker. The minister has promised to pay, how can I doubt his words?

DN: Do you think we will have become self-sufficient in milk production by 2020?

SD: I do not think so. Maybe some competent people might have a different opinion but I do not expect it to happen within the nearest 10 years. The current situation is as follows: many traditional 5,000 — head farms are sold to investors who do not specialise in milk production. These investors get rid of the cows within a year. At the same time, the overall volume of milk produced by modern dairy enterprises is not more than 3-4 million tonnes, which means we still need to grow and increase our production. There are not many new dairies being built at the moment. I am sure that modern farming operations will not make up for the loss of the traditional farms, to say nothing of farm households.

DN: Aleksandr Tkachev has recently encouraged agricultural producers to build large farms. What size is the most profitable for a farming operation?

SD: We also opt for large farms. I believe that 2,500- 3,000- or, maybe, even 5,000-head dairies are the most optimal ones. Especially if one company has several dairies like this. It ensures efficient management of all the dairies and allows transferring employees from one dairy to another in case of necessity.

DN: Do you have any problems with finding the right staff?

SD: I would not call it a problem, it is more of a challenge, which we need to overcome, no matter how difficult it is. In 2016, our company accepted over 250 interns from 25 Russian institutions of higher education and colleges.

We conclude employment agreements with our interns, pay 10 thousand rubles per month and give them a bonus at the end of the internship, depending on the result of their work. Therefore, interns have a good opportunity то obtain the precious experience and earn some money at the same time. Almost 20% of interns return to our company for further internships. When university graduates, which did internship in EkoNiva, come to work for the company, we arrange a 4-month training for them, which includes lectures in the first half of the day and on-site training in the second half of the day. I used to think that young people enter agricultural universities only to get a diploma, and future vets dream of working with cats and dogs at expensive clinics, not with cattle at farming operations. The reality has proved me wrong: there are many talented and enthusiastic young specialists. It is always interesting to talk to them. 20% of students who had done internship on our farms and graduated from the universities in 2016, have come to work for our company. By the way, one would find it surprising but there are quite a lot of young women among veterinarians.