CROP PRODUCTION

     The Group’s crop farming operations are located in two operational clusters, Poltava and Chernihiv. Within each cluster, the Group’s fields are situated in close proximity to each other with an average distance between them of approximately 20 km. This enables the Group to maximize operating efficiency and achieve cost savings by optimising the use of its mechanical and human resources and facilitating effective operational management. The Group applies modern farming techniques and good operational and management practices to its land and invests in modern agricultural technology, machinery and equipment.

     IMC predominantly applies no-till and min-till farming technology meaning that farm land is not tilled on annual basis. This technology requires less machine hours per hectare of farm land and allows to preserve more moisture in the soil to maximise crop yields.

     The Group’s use of GIS and GPS enables it to seed and harvest its crops with greater precision, which in turn has helped reduce fuel consumption and seed usage. It also helps eliminate human error during cultivation. The system gives Management a more complete picture of equipment movements from a central dispatch centre and is intended to help the Group improve the efficiency of its equipment use by allowing it to better coordinate and supervise the location and movement of its machinery and react to unexpected situations more rapidly, which minimises operational expenses.

     The Group’s use of high performance, modern machinery and equipment enables it to utilise its production team more efficiently through the use of technology which is less labour intensive in terms of the number of employees required in the production process and the performance of its equipment is greater than older, less modern equipment. Modern equipment has much lower normal loss rates, which enables to increase crop yields.

The Group’s core business is the large-scale cultivation of corn, wheat and potatoes.

Corn is the principal grain cultivated by the Group.

Wheat. The Group currently focuses its wheat production principally on winter wheat, which typically has a higher average yield compared to spring wheat.

Potatoes. The Group produces more than 10 varieties of potatoes, which can be categorized into 3 main groups – seed, processing and table potatoes. All potatoes cultivated by the Group are sold in the domestic market, including to customers such as Kraft Foods Ukraine.

Sunflower. In the 2010 agricultural year, the Group harvested sunflower seed on approximately 3,900 hectares of land.

Soybeans. In the 2010 agricultural year, the Group harvested soybeans on approximately 3,400 hectares of land.

CROPPAGE DATA IN 2007-2010