Ukraine's Kernel agricultural holding invests $44.15 mln to purchase sunflower oil transshipment terminals on Danube river, in Black Sea in 2023-2024

MOSCOW. Oct 30 (Interfax) - Ukraine's Kernel agricultural holding has reinforced its logistics base for handling sunflower oil in 2023-2024 and purchased a sunflower oil transshipment terminal Reni-Oil LLC for $24.75 million, as well as facilities in the port of Chernomorsk for $19.4 million, Ukrainian media reported, citing the company's annual report.

Reni-Oil's terminals have a capacity of one-time storage of 15,000 tonnes of sunflower oil in the port of Reni, it said. This terminal is the only facility among Ukrainian ports on the Danube river with appropriate acceptance, storage and shipping capacities, which enables sunflower oil to be exported bypassing the Black Sea ports.

Kernel also acquired vegetable oil transshipment assets at the Chernomorsk port with a one-time storage capacity of 97,000 tonnes to enhance the sustainability of its oilseed processing business.

"These additional storage facilities will allow us to maintain the operations of our oil extraction plants during transportation disruptions, which we have experienced heavily in the 2022-2023 fiscal years, thereby smoothing out our logistics. If the Black Sea remains open for export operations, the facilities would become critical for sunflower oil transshipment, enabling us to abandon the use of third-party capacity and improve supply chain efficiency," it said.

The agricultural holding also invested $2.3 million in rebuilding and preparing the facility for operation in the port of Chernomorsk in the fiscal year 2024. The facility was commissioned in January 2024 and began handling sunflower oil.

It is now called TGT-Oil, which is having an annual transshipment capacity of 1.4 million tonnes and serving as a transshipment and trading hub for vegetable oil. The facility offers transshipment services to third parties and allows Kernel to purchase sunflower oil on a CPT basis for further exports.

The Kernel Agricultural Holding is the world's largest exporter of sunflower oil and one of the largest producers and sellers of bottled oil in Ukraine. The company is also involved in growing agricultural products and their sales.

Kernel posted $299 million in net profit for FY 2023, while the company ended the previous year with a net loss of $41 million. The agricultural holding's revenue for FY 2023 declined 35% to $3.455 billion, but EBITDA increased 2.5-fold to $544 million.

The agricultural holding reduced its net profit 53% to $204 million in the first nine months of FY 2024, while revenue fell 4% to $2.595 billion, and its EBITDA decreased 36% to $384 million.