December 2023 - Page 2 of 4 -

Danone’s Russian Political Maze

Explore Danone’s challenging journey in Russia amid unexpected management changes and complex negotiations, revealing the intricacies of corporate resilience.

Danone in Russia: Navigating a Corporate Maze Amidst Political Tensions

The Danone Dilemma in Russia: A Tale of Unexpected Management and Unsettled Deals

This summer, a group of Chechens linked to Ramzan Kadyrov, their regional leader, unexpectedly took control of Danone’s operations in Russia. This move occurred while Danone, a French dairy giant, was finalizing a deal to exit Russia. The Kremlin’s decision to place Danone and Danish brewer Carlsberg under “temporary external management” disrupted these plans, especially affecting Carlsberg, whose former executives are now imprisoned. However, Danone’s situation has evolved into a peculiar stalemate, with much of the company’s daily management remaining unchanged under the new Chechen leadership.

Business as Usual? Inside Danone’s Russian Operations Post-Takeover

While the Chechen takeover seemed alarming, the operations at Danone’s Russian dairy factories have continued with minimal disruptions. The new Chechen managers, surprisingly professional in their approach, have avoided aggressive tactics, maintaining a low profile. The situation, described as “extremely amicable,” has not provoked public complaints of mistreatment from Danone. Despite these developments, the company is still working to finalize the sale of its Russian business, seeking a Kremlin-approved buyer.

Impact and Response: Danone and Carlsberg’s Different Paths in Russia

Russia’s abrupt management changes in foreign companies, like Danone and Carlsberg, have created shockwaves. Danone, representing about 5% of the group’s annual revenue, is significantly impacted by these developments. Initially committing to stay in Russia post-invasion of Ukraine, citing responsibility towards employees and suppliers, Danone later shifted its stance, planning an exit that could lead to substantial financial losses. Meanwhile, Carlsberg’s situation contrasts sharply, with arrests and allegations of targeting innocent employees by the Russian government.

Navigating Uncertainty: The Road Ahead for Danone in Russia

Despite the takeover, Danone’s executive committee in Russia remains active, working towards asset protection and a potential sale. The company, while preparing to protect its shareholder rights, has stopped short of directly accusing Russia of expropriation. Interestingly, while Yakub Zakriev, Kadyrov’s nephew, is officially the general director of the renamed “Life & Nutrition,” Dutch Danone veteran Charlie Cappetti continues to play a significant role unofficially.

The Complexity of Yogurt Production: Danone’s Leverage in Russia

Danone’s expertise in yogurt production, involving complex supply chains and unique ingredients, offers it some leverage over the new management. This complexity ensures that the company’s unique production processes remain vital, posing challenges for any drastic changes by the new managers.

Conclusion: A Tense Balancing Act in Corporate Russia

Danone’s situation in Russia highlights the challenges faced by foreign investors in navigating uncertain political and economic environments. The company’s cautious approach and ongoing negotiations reflect the complexities of maintaining business operations while adhering to corporate responsibilities and navigating geopolitical tensions.

Is Tyson Foods Secretly Selling Insect Protein To Humans?

The simple answer is:

Kind of…

Tyson Foods and Protix Partnership: Focused on Animal Feed, Not Human Food

Insect Protein for Pets, Not People
In a recent development, Tyson Foods, a company primarily known for its poultry products, has entered into a partnership with Protix, an insect protein firm. However, this collaboration is not what some might think. Contrary to circulating rumors, Tyson Foods has no plans to introduce insects into human food. Instead, their focus is on developing insect-based proteins for animal feed, including pet food and aquaculture.

Read Now: Why Is Tyson Foods Collaborating With Protix?

New Facility for Insect-Based Products
October 2023 marked a significant milestone for Tyson Foods and Protix as they announced plans to construct an insect ingredient facility in the United States. This facility isn’t for human food production but for breeding and processing insects for use in pet food, aquaculture, and livestock feed industries.

Tyson Foods’ Clear Stance: No Insects in Human Food
Tyson Foods has made it clear on their website and through official statements that their business remains centered on poultry, pork, and cattle. There is no mention or indication of venturing into insect-based products for human consumption.

More about Tyson Foods: Tyson Foods hacked by cybercriminals

Edible Insects: Safe for Humans but Not Tyson’s Focus
While the FAO (Food and Agriculture Organization of the United Nations) acknowledges that insects can be a nutritious and safe food source for humans, Tyson Foods’ partnership with Protix is strictly for non-human consumption. Their aim is to utilize insects as a sustainable ingredient in animal feed, not for people’s dinner tables.

Smithfield Exit Shakes Up Utah Farmers’ Future

The Decline of Hog Farming: A Blow to Rural Utah’s Way of Life

Smithfield’s Exit: Departure Leaves Beaver County Farmers Struggling for Survival

In a significant blow to the agricultural community of Beaver County, Utah, Smithfield Foods, a leading name in hog farming, has announced its withdrawal from the region. This departure leaves local farmers facing an uncertain future, as hog farming represents the primary employment sector in this rural part of the state.

The Tough Reality of Agricultural Life

Farmers in Beaver County are known for their resilience, a trait now put to the test as they confront the challenges posed by Smithfield’s exit. Commissioner Brandon Yardley reflects this spirit, stating, “We’ll figure it out. Seems like we always do.” However, the withdrawal of Smithfield, involving the termination of contracts with 26 hog farms, is not just a blow to the company’s employees but also to the entire community relying on this industry.

Economic and Personal Struggles of Local Farmers

Brett Bunker, a local farmer, highlights the broader challenges faced by those in rural agriculture. Beyond the direct impact of Smithfield’s departure, farmers like Bunker grapple with issues like water usage criticism and the overall uncertainty of the agricultural industry. The end of their contracts with Smithfield means a significant reduction in income, equating to a drastic pay cut for these hardworking individuals.

Statewide Impact and the Search for Solutions

The consequences of Smithfield’s decision ripple beyond Beaver County, affecting various counties across Utah. The agricultural sector, which boasted $220 million in hog inventory sales in Beaver County alone, is now in a precarious position. Officials and organizations, including the Utah Department of Agriculture and Food and the Utah Farm Bureau, are actively seeking solutions to support the affected communities and industries.

The Larger Picture: Economic and Environmental Consequences

The issue extends into environmental concerns as well. Plans for renewable energy projects, like methane capture from hog farming operations, are now uncertain. This setback not only affects local economies but also hampers efforts towards sustainable energy solutions.

Rural Resilience in the Face of Adversity

Despite these challenges, the people of Beaver County, including Commissioner Tammy Pearson and other community members, are determined to persevere and adapt. The agricultural community, deeply rooted in their way of life, is not ready to give up despite the hardships. They stand as a testament to the enduring spirit of rural America, facing adversity with determination and hope for a sustainable future.

Tyson Foods Innovative Child Care Plan

Innovative Child Care Program at Tyson Learning Center, Humboldt

Setting the Scene: Story Time in Tennessee

In the heart of Humboldt, Tennessee, at the Tyson Learning Center, it’s story time, a special moment under the guidance of teacher Tequeria Pewitte. As she gathers the children, all related to Tyson’s poultry plant workers, there’s a sense of community and care that goes beyond the usual.

Tyson’s Unique Solution for Employee Child Care Needs

Recognizing the need for accessible child care, Tyson Foods has taken an innovative step by partnering with KinderCare to run a facility that opens early to accommodate the schedules of their plant workers. Garrett Dolan from Tyson Foods explains the rationale: ensuring reliable child care aligns with their operational hours is crucial for their workforce.

Driving Force Behind the Initiative

Garrett Dolan, a human resources strategist at Tyson, spearheaded the company’s new child care program. With a substantial investment of nearly $5 million, Tyson has tackled a significant challenge in rural areas: the scarcity of affordable child care options. This scarcity often deters potential workers, as Dolan points out the financial dilemma faced by many employees in balancing income with child care costs.

Marketplace Morning Report: A Broader Perspective

The issue of affordable child care is gaining attention across various industries in the U.S. The federal government is stepping in, especially in sectors like the semiconductor industry, mandating child care plans for companies seeking significant CHIPS Act funding, as explained by Adrienne Elrod, director at the CHIPS Program Office.

Tyson’s Pilot Program: A Response to Workforce Needs

The Humboldt center is Tyson’s pilot project, strategically located in Tennessee due to its robust child care subsidy. The program offers affordable care, with parents paying substantially less than the state average. This initiative is not just about affordability; it’s about providing vital support for shift workers like Tiffany Butler, a mother of five and Tyson employee, who views the center as a gateway to re-enter the workforce.

The Impact and Future of Tyson’s Child Care Initiative

Tiffany Butler’s story is a testament to the program’s success. The facility not only supports her family’s well-being but also reinforces her loyalty to Tyson. This kind of benefit, known as a “sticky benefit,” is seen as a key factor in retaining employees. However, Elliot Haspel, an author on America’s childcare crisis, warns about the potential exclusion of gig workers and others without regular employment from such benefits.

Assessing the Program’s Effectiveness and Potential Expansion

Tyson acknowledges the need for a thorough evaluation of the Humboldt program over the next few years. Success will be measured not just in worker retention and reduced absenteeism, but also in the positive impact on Tyson’s community reputation, as highlighted by Garrett Dolan. If successful, this could signal a broader trend in industry-supported child care solutions.

Keystone Foods: The Global Protein Leader!

Keystone Foods: A Global Powerhouse in Protein Production and Supply, Marked by Strategic Expansion and Robust Revenue Growth

Keystone Foods, a notable food services company, is known for processing, producing, and supplying a variety of fresh and frozen animal protein products including poultry, beef, fish, and pork. These products are distributed to a diverse range of clients such as quick-service restaurants, food service locations, industrial food companies, retail outlets, and other market channels across the globe. The company has a strong presence in the food industry, particularly in providing value-added products like chicken nuggets, wings, tenders, beef patties, and breaded fish fillets.

An important development in the history of Keystone Foods was its acquisition by Tyson Foods Inc. in 2018 for $2.16 billion. This acquisition was a strategic move by Tyson Foods to expand its international presence, enhance its value-added production capabilities, and grow its portfolio in the global foodservice industry. The deal included six processing plants and an innovation center in the U.S., along with additional facilities and innovation centers in Asia Pacific countries like China, South Korea, Malaysia, Thailand, and Australia.

Keystone’s Pre-Tyson Boom: 11K Employees, $2.5B Revenue, and Global Expansion

As of the last reported period before the acquisition, Keystone Foods employed approximately 11,000 people and generated an annual revenue of $2.5 billion, with a significant portion of its revenue coming from U.S.-based production and the rest from its Asia Pacific operations. The acquisition by Tyson Foods was expected to be beneficial in terms of financial performance, contributing positively to Tyson’s earnings per share and generating annual synergies estimated at around $50 million by the third year through operational efficiencies and other optimizations.

Sources:

For a more in-depth look at Keystone Foods, including its financial performance and other business aspects, you can visit Zippia’s profile on the company here.

Container Shipping’s Latest Billion Dollar Problem

Shipping Industry Braces for Billion-Dollar Impact of EU Emissions Trading Scheme (ETS)

The International Transport Intermediaries Club (ITIC) is warning of a potentially massive financial impact on the shipping industry, possibly reaching billions of dollars, due to the European Union’s (EU) forthcoming Emissions Trading Scheme (ETS). Starting on January 1, 2024, the expanded EU ETS will set annual limits on greenhouse gas (GHG) emissions for large ships visiting EU ports.

However, this implementation is causing disputes between shipowners and charterers, particularly regarding the language in charter agreements aimed at fairly dividing costs and managing legal risks.

Robert Hodge, the General Manager at ITIC, is stressing the importance of ship managers doing thorough research to effectively handle these risks.

ITIC’s warning comes after a recent meeting of BIMCO’s documentary committee, which includes ITIC and other major players in the shipping industry. During this meeting, BIMCO made a significant move by adding an ETS allowances clause to its ship management agreement, SHIPMAN.

Additionally, they introduced three tailored ETS clauses for voyage charter parties. These clauses are designed to make compliance with changing regulations easier and to address the evolving issue of carbon emissions in the maritime sector.

As an advisor on the BIMCO document committee, ITIC is gearing up to host a webinar to guide its members through potential challenges and provide comprehensive advice to ship managers.

According to a statement, the EU ETS is a response to the growing regulatory demands set by the International Maritime Organization (IMO) and the European Union to reduce GHG emissions from ships traveling in European waters and docking at European ports.

Source: Container News

FrieslandCampina Cuts 1,800 Jobs for Profitability

FrieslandCampina, a prominent Dutch dairy cooperative, has unveiled a comprehensive cost-saving strategy that includes cutting 1,800 jobs across its global operations over the next two years. This strategic move, geared towards improving profitability, is projected to yield savings of up to €200 million ($215 million) and forms a pivotal component of the company’s ambitious plan to slash annual expenses by €400 million to €500 million by 2026.

Global Dairy Powerhouse

With a formidable presence in more than 100 countries, FrieslandCampina ranks as one of the world’s leading dairy cooperatives. Its product portfolio spans a wide spectrum, encompassing dairy staples such as milk and cheese, as well as vital components for the food and pharmaceutical sectors. The cooperative’s workforce currently spans 30 countries and comprises roughly 22,000 employees, underscoring its global significance.

Streamlining Operations for Efficiency

The decision to cut 1,800 jobs underscores FrieslandCampina’s commitment to operational efficiency and cost control. This ambitious workforce reduction initiative will require careful planning and execution to ensure that the company continues to meet the demands of its diverse international customer base while remaining competitive in an ever-evolving industry.

Financial Performance

In its financial report for 2022, FrieslandCampina reported a substantial turnover of €14 billion, a testament to its market dominance. Nonetheless, the dairy industry is not without its challenges, including fluctuating milk prices, shifting consumer preferences, and mounting environmental concerns. In response, FrieslandCampina is proactively adapting its operations to navigate these challenges while sustaining profitability. FrieslandCampina plans to cut 1,800 jobs worldwide in 2 years, aiming for €200 million savings to boost profitability and reduce annual costs by up to €500 million by 2026.

Navigating Industry Challenges

This strategic workforce reduction by FrieslandCampina reflects a proactive response to the multifaceted challenges confronting the dairy industry. By focusing on cost efficiency and profitability, the cooperative aims to maintain its position as a competitive and sustainable player in the global dairy market.

As FrieslandCampina embarks on this transformative journey, its actions are poised to shape not only its future but also the broader landscape of the dairy industry. Stakeholders, employees, competitors, and industry observers will closely monitor the cooperative’s progress as it strives to adapt to changing market dynamics while ensuring long-term sustainability.

Source: Amsterdam, December 12, 2023 (Reuters)

How McDonald’s Made OSI a Super Power in The Food Industry

OSI Group’s Rise: From McDonald’s First Burger Supplier to Food Giant

Back in 1955, a small company called Otto & Sons shook hands with Ray Kroc, the man behind McDonald’s. That handshake turned them into the first supplier of fresh burgers for McDonald’s in Des Plaines, Illinois. Fast forward, and now they’re known as OSI Group. They don’t just make burgers; they cook all sorts of meat – like bacon, sausages, and even pepperoni. And it’s not just meat; they also make loads of pizza crusts, breads, snacks like taquitos, and even big pots of mac and cheese, soups, and beans.

OSI Group, a major player in the food manufacturing industry, possesses the capability to cook various meats to the desired finish, whether it’s browning, searing, or charring. Their range includes items like bacon, sausage patties and links, riblets, deli meats, meatballs, meatloaf, pepperoni, and salami. Beyond meat products, OSI can produce vast quantities of pizza crusts, flatbreads, paninis, taquitos, mac and cheese, and even soups, chili, and beans.

The company began its journey as the first supplier of fresh hamburger meat to the original McDonald’s franchise in Des Plaines, Illinois. This partnership, formed with a handshake agreement with Ray Kroc in 1955, marked the beginning of OSI’s expansion. Initially known as Otto & Sons, the company was offered the opportunity to become one of five national suppliers of frozen hamburger patties for McDonald’s, propelling its growth.

Recently, OSI, now one of the world’s largest contract food manufacturers, has seen a change in leadership. The company’s new Chairman, Steven Lavin, is steering it into a new era, a transition that I explore in my latest feature.

Read Profile: Who is Steven Lavin, the Chair of OSI Group?

Who is Steven Lavin, the Chair of OSI Group?

Steven Lavin, as the chair of OSI Group, has played a significant role in the growth and success of the company. OSI Group is a major player in the food industry, known for preparing and providing food products to large brands like McDonald’s and Chipotle. However, detailed information on Steven Lavin’s specific achievements and career highlights at OSI Group is not readily available in the public domain.

From the available information, it’s clear that Lavin observed the growth and expansion of OSI Group under his late father’s leadership before taking over the reins. This experience likely provided him with valuable insights and understanding of the company’s operations, contributing to his capability to lead the organization effectively.

In general, leading a company like OSI Group requires a blend of strategic vision, operational expertise, and the ability to navigate complex global supply chains and client relationships. Given OSI Group’s prominence in the food industry and its role as a supplier to major global brands, Lavin’s leadership would involve maintaining high standards of quality, innovation in food processing technologies, and responding to the dynamic needs of the global market.

Why Is Tyson Foods Collaborating With Protix?

Tyson Foods and Protix Buzz into Future: Revolutionizing Protein with Insect-Powered Superfoods!

Tyson Foods, a global food industry giant, has recently teamed up with Protix, a leading company in insect-based ingredients. This exciting partnership is set to revolutionize the way we think about sustainable protein production.

Here’s the scoop: Protix is not your average company. They specialize in turning insects into ingredients for things like pet food, fish feed, and even organic fertilizer. Sounds quirky, right? But it’s seriously smart. They use food waste to feed these insects, making the whole process like a green loop.

On the other side of this partnership is Tyson Foods. These guys are big in the food world, known for their protein-packed products. They’re all about finding new, earth-friendly ways to feed the planet.

Tyson Foods and Protix Launch Mega-Insect Protein Facility, Aiming to Feed the World Sustainably

So, what’s the plan? Together, they’re building a new facility in the U.S. just for making insect ingredients. We’re talking a whopping 70,000 tons of live larvae every year! Plus, Tyson Foods is investing a cool €55 million to help Protix grow even bigger globally.

This isn’t just about making bugs into food. It’s a big step towards feeding our growing population without hurting the planet. The big brains at Protix and Tyson Foods think this could be a game-changer in how we make food for pets, fish, and farm animals.

And get this: the demand for protein is shooting up. By 2050, we’ll need 70% more of it! Insect protein could be the answer, and this partnership might just be the push it needs to go mainstream.

Protix has big dreams. They’re aiming to open 13 plants by 2035 and rake in about €1 billion in sales. With Tyson Foods in their corner, they might just do it.

But can bugs really replace the protein we’re used to? Protix says, “Why not?” With a bit more research, some new rules, and more people getting on board, insects could be the next big thing on our plates and in our pet’s bowls.

So, there you have it: a partnership that’s all about bugs, big ideas, and a better planet. Stay tuned to see how this bug story unfolds!