Products of PAVA’s Grain Fractionation Project Will Be Sold on Growing Markets

Currently, specialists of PAVA’s Business Development Department are in the process of negotiations with large Russian and foreign corporations, signing preliminary agreements for future sales.

27/10/08 PAVA, the Russian company carrying out the advanced wheat grain processing project, announced that new products represented by valuable food ingredients will be sold on both domestic and overseas markets. Currently, specialists of PAVA’s Business Development Department are in the process of negotiations with large Russian and foreign corporations, signing preliminary agreements for future sales. Research has shown that the Russian market for these products is characterized by a steady tendency for growth, consequently opening grand opportunities.

The production will mainly focus on vital wheat gluten, starch products and alcohols. Gluten is a valuable ingredient, improving the quality of flour and bakery. Recently, global demand for it has grown dramatically as new recipes and technologies are developed. In Russia it increased thousands of times, official data says. Starch is an essential component in food as well as non-food sector, and demand for this product is spurred by their expansion. The Russian market lacks quality, reasonably-priced starch produced by domestic manufacturers, the share of expensive import is rather high. Syrups are widely used as natural sweeteners, and this market has an enormous potential. These components have important nutritive value and provide a number of technical benefits to the end-product.

The capacity of beverage alcohol market remains stable; however, production is stalled by increased cost of raw materials. PAVA, following the strategy of vertical integration, develops its own agricultural production and provides independent feedstock supplies. This allows to set a competitive price, and secure its own market niche.

“Even if the situation on the market undergoes serious change, the flexible technology of the plant will allow us to adjust to the new environment. We can respond to shifts in demand by producing more starch products or more alcohol products. This will help minimize risks of the project and provide the company with a competitive edge,“ said Galina Balaenkova, PAVA International Business Development and Investor Relations Director.