Like many Western companies, McCain, a specialist in frozen industrial fries, has chosen to leave Russia. A decision taken after the invasion of Ukraine by the Russian army on February 24, when the Canadian company was building a factory there to meet the demand of its customers. “We had developed, for decades, a transfer of skills to farms for the production of potatoes adapted to our needs. We were getting to the production stage. In a few weeks, we decided to interrupt the construction of the site, located in Tula, 180 kilometers from Moscow”says Max Koeune, managing director of McCain.
The total investment was estimated at 180 million euros, of which almost a third had already been committed. The site was sold on June 30 for a symbolic amount to a Russian investor who could continue the project. “Moscow’s desire is to increase the added value of Russian agricultural production”emphasizes Mr. Koeune.
McCain, which was also in the process of building its brand with Russian consumers, ceased all commercial presence in that country. “We made less than 5% of our turnover in Russia”, tempers Mr. Koeune. Knowing that for the fiscal year ended at the end of June, the family agri-food group posted a turnover of 11 billion Canadian dollars (8.4 billion euros), an increase of more than 10%, driven by the price inflation. It draws a line under its ambitions in this country, where it had established itself at the turn of the 1990s, by importing products manufactured in other European sites, at a time when its major customers, fast food chains such as McDonald’s, KFC or Burger King, began to deploy their signs.
Development of fast-food networks
We remember the highly publicized opening of the first McDonald’s, Pushkin Square in Moscow, in January 1990, in what was still the USSR. Gradually, the sign with the golden arches extended to claim 850 establishments, of which a large part is franchised. It was one of its franchisees, the businessman Alexandre Govor, who bought the restaurants in May, when McDonald’s decided to leave Russia and demolish its brand, while keeping the rights of ownership of the brand.
Today, a competitor of McCain, the American company Lamb Weston, continues to produce frozen fries in its factory located in Lipetsk, owned in partnership with a Russian shareholder. But it is also committed to exiting this joint venture as soon as possible.
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