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Mondelez resumes Oreo production in Ukraine as war-damaged plant reopens

Mondelez resumes Oreo production in Ukraine as war-damaged plant reopens
Mondelez International's Oreo biscuits are seen in this illustration picture taken July 26, 2021. REUTERS/Dado Ruvic/File Photo
REUTERS
Kiran Paul
By Kiran PaulMay 31, 2024
Kiran Paul
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Snack maker Mondelez resumed its production of Oreo cookies in Ukraine, after its plant in a small city in the eastern part of the country was badly damaged during Russia's invasion roughly two years ago.

Mondelez's plant in Trostyanets is now fully rebuilt after opening partially last year to make chocolates, according to a company statement.

The company said the Oreo cookies and other chocolates produced at the Ukrainian factory are not being exported to neighboring Russia. Mondelez has three factories in Russia and sells its cookies and snacks there despite boycotts and calls for it to stop from employees, activists and investors.

Mondelez said it was making its business in Russia "stand-alone" with a self-sufficient supply chain by the end of 2023. It appointed new leadership in Europe including Russia earlier this year.

Mondelez's rivals including Nestle, the world's biggest food company, continue to sell their products in Russia. Food does not fall under international sanctions.

While the plant in Trostyanets was being repaired, Mondelez imported Oreos to Ukraine, said a source familiar with the company's plans, who is not permitted to speak to media.

The company said products made in the Trostyanets plant are exported into Eurasian countries such as Georgia and Kazakhstan in addition to being sold in the domestic Ukrainian market.

Plants in Russia previously helped supply those countries, the source said.

"We continue to increase our investments in supporting and rebuilding Ukraine," the company said in the statement.

Mondelez previously told Reuters there were no more exports from Russia into Europe.

Chocolate wafers with a cream vanilla filling, Oreos are one of Mondelez's biggest brands, and hit about $4 billion in sales revenue last year, according to a LinkedIn post from CEO Dirk Van de Put. Mondelez's other top brands include Milka and Cadbury chocolates. It also makes local-brand cookies and crackers.

A little over 30 per cent of Mondelez's shareholders last week backed a resolution calling for the company to conduct an independent study of the risks of continuing to do business in Russia, according to a company filing.

Norges Bank, Mondelez's 11th-largest shareholder according to LSEG's Eikon, backed the proposal, according to the fund's disclosures. The fund said in the disclosure that when a company "does not meet our needs as a financial investor, we will consider supporting a well-founded shareholder proposal."

(Reuters)

mondelez internationaloreoukraine russia war

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