A growing presence in Ukraine

by Melissa Alexander
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The largest grain exporter among Ukrainian-owned companies, Nibulon Ltd., continues to expand, having added new grain storage facilities at the Port of Nikolaev.

by Arvin Donley

Since its establishment in December 1991, shortly after the collapse of the former Soviet Union, Nikolaev, Ukraine-based Nibulon Ltd. has steadily grown from a small agricultural producer into a large enterprise with 14 production facilities in Ukraine’s four regions and a large export terminal at the Port of Nikolaev.

In addition to having 1,800 employees working at its facilities, Nibulon leases land plots from 5,800 landowners and cultivates nearly 43,000 hectares of arable land, producing more than 100,000 tonnes of grain each year.

Through a steady increase in production and sales, Nibulon has become the largest grain exporter among Ukrainian-owned companies. Nibulon is the only Ukrainian large-scale exporter that is not connected with grain multinationals.

At the Ukrainian Grain 2005 exhibition in October, the Ministry of Agrarian Policy of Ukraine — upon recommendation by the Ukrainian Grain Association — named Nibulon Ltd. the best national grain trader in 2005.

The latest example of the company’s growth came in September 2005, when Nibulon celebrated the opening of a new complex of grain storage facilities at its

grain transshipment terminal at the Port of Nikolaev. More than 300 people attended the ceremony at the port, located along the Black Sea.

The export terminal features four new port silos with a combined capacity of about 22,000 tonnes (5,500 tonnes each). Nibulon officials say the corrugated steel storage silos were built and designed with 700-tph conveying systems and weighing equipment. With two 50,000-tonne grain silos having been constructed earlier, the total storage capacity at the port has increased to 122,000 tonnes.

Nibulon says the new silos, which were supplied by SCAFCO Grain Systems Company, allow the company to "substantially increase the possibilities of the terminal with regard to intake, storage and shipment of a wide variety of grains."

Nibulon says the complex is "harmonically integrated" into a transport technology scheme of storage and cargo handling at the transshipment terminal, therefore increasing its general productivity and flexibility in terms of working with various commodities. The company can now export up to 20,000 tonnes of grain per day and unload 30 trucks per hour and 90 rail cars per day.

The project, which involved 22 local and foreign sub-contractor companies, took less than three months to complete, as the companies involved worked around the clock.

In assembling the four grain silos, each measuring 18 meters in diameter and 32 meters high, modern technologies of assembling by splicing were applied, which cut construction time on each silo down to 12 days. The first stage involved construction of the roof; then the walls and gates were assembled. Assembling was performed with simple lifting jacks instead of construction cranes, which would have required having additional roads and construction areas.

The Nibulon grain terminal allows for:

• simultaneous intake/shipment of seven different crops or crops with different specifications;
• acceptance of separate flows of grain with moisture and dockage in excess of contractual limits, with subsequent purification, drying and storage;
• drying up to 100 tonnes of grain per hour; and
• formation of export consignments of grain, complying with foreign purchaser’s requirements for the quality measures of milling and feed grain.

The Nibulon terminal has significantly changed the cargo shipping landscape in the Nikolaev region. In the 2004-05 marketing year (July-June), 72% of the region’s total export volume was shipped through Nibulon’s terminal, which is more than 1.3 million tonnes of grain crops worth more than U.S.$128 million. During the first seven months of the 2005, Nibulon sold more than 1 million tonnes of grain.

To ensure proper storage and timely shipment of the harvested crops, Nibulon has become a majority shareholder of three grain storage enterprises and elevators during the past several years. Its recent investments include a controlling interest in Starobelskiy Elevator, the fifth largest elevator in the Ukraine.

The elevators, with the total capacity of about 400,000 tonnes, are located near the company’s production branches, ensuring storage with minimal transportation expenditures. It also provides the opportunity to accumulate consignments in the course of trade activities and the subsequent delivery to the export terminal.

Since construction on its grain export terminal at the Port of Nikolaev began in 2002, Nibulon has invested more than U.S.$62.4 million in the project, including U.S.$9.9 million for the 2005 expansion.

The quality of the project hasn’t gone unnoticed in Ukraine.

In 2003, Nibulon received the Ukrainian Industrial Projects Award from the State Building Control of Ukraine and the Building Research Institute. The award is given for projects that experts deemed to be "the best and most interesting."

In November 2005, at the All-Ukrainian "Best National Commodity" exhibition contest, Nibulon was named the best Ukrainian company in the construction category for "construction and provision for operation of a terminal for grain and oilseeds using innovation technologies." Nibulon was also honored in the transportation services category for "transport services for transshipment of agricultural commodities."

During its 14 years in business, Nibulon has invested more than U.S.$119 million into capital assets.