Singapore-based Olam International becomes the latest coffee and food supplier to sell its business in Russia following the country’s ongoing invasion of Ukraine
The Yakhroma facility has the capacity to produce 7,000 metric tons of coffee annually | Photo credit: Olam International
Olam International has sold its business in Russia to Smolensk-based coffee roaster Lalibela Coffee.
Olam International’s Russian subsidiary, Outspan International, ceased operations in Russia earlier this year and completed the sale of its instant coffee packaging plant in Yakhroma, Moscow, on 18 November 2022.
“We plan to invest about $9m into development of this segment, which will make it possible to fully utilise the plant’s capacity against the shortage of free production capacities and high quality semi-finished instant coffee existing in Russia at present. The product under the Lalibela trademark will be produced in Yakhroma and federal retail chains’ orders will be placed to produce their private labels in the instant coffee category,” said Dmitry Guschin, CEO, Lalibela Coffee.
The Yakhroma facility has the capacity to produce 7,000 metric tons of coffee annually, which Guschin said could potentially account for up to 7.5% of total instant coffee consumption in Russia.
Lalibela Coffee roasts and distributes packaged ground coffee at retail chains, hotels, restaurants and cafés across Russia.
The acquisition is the latest example of Russian companies relaunching international brands that ceased operations in Russia following the invasion of Ukraine.
In September 2022, Milfoods LLC, the former Russian subsidiary of Finnish coffee, beverage and food supplier Paulig, began producing coffee under a new Poetti Coffee brand.
Paulig completed the sale of its business in Russia in May 2022.
International coffee chains have also reopened under new branding following the exodus of western retail brands in 2022.
The first Stars Coffee outlet opened in Moscow in August 2022 following the rebranding of 130 Starbucks sites. In November, Russian restaurateur Arkady Novikov launched a chain of Krunchy Dream cafés on former Krispy Kreme stores in November 2022.