For a long time, the name of the UBM Group was mostly known within the industry only. In March of 2017, however, it had its shares listed in category T of the Budapest Stock Exchange. The company group, today consisting of nine companies, is a prominent Hungarian protein importer, grain trader, and a leading animal feed producer.
“Synergies work”, says Ákos Varga, chairman of UBM Trade Zrt., which exercises owner’s rights over the group, explaining how they have been able to grow continuously over the last twenty years.
Ákos Varga joined UB Merchants Kft. in 1997, practically in the beginning. The company started out by importing soy meal by waterways, along the Danube/Main/Rhine channel instead of using customary railway shipping. The business was owned by András Uzsoki and Andor Botos at the time. “What they expected from me was to make their trade thrive”, recalls Varga. “From the past, I have learned to be humble, both towards our partners and employees. We don’t just pay lip service to putting people first. We have created a livable corporate culture, and I can confidently say that our company is a good place to work for.”
UBM is also thinking of the future, and of the generation change. They have an internship programme in place, and have already found a future leader as well – naturally not from outside but from within the company. Péter Horváth, who today sits on the board, joined the company in 1999, and soon proved his worth by being active on the Chicago Mercantile Exchange and also in the Dutch port trade.
It was at that time that they launched their grain trading operations and started importing other feed ingredients such as corn gluten or soy oil. In 2004, László Bustyaházai joined UBM, under whose leadership the feed division was created. It wasn’t easy, but they did it, separately for each type of animal, complete with consultancy, and taking the individual needs of each client into consideration. At the time, it still paid off to outsource production of the premix (the concentrate required for making ready-made feed). Later however, as they grew, they were able to produce it themselves, in their own plant.
In addition to their premix plant, they also have several independently and jointly owned feed mixers throughout Hungary. “We produce 12,000 tons of premix, and distribute 200,000 to 250,000 tons of soy meal, of which 150,000 tons are destined for the domestic market, making us a market leader with a market share of 30%. We work with 700,000 to 800,000 tons of grain, which accounts for 7 to 9% of the market. A small part of this is added to our own feeds, while the rest is either exported or sold within the country. We are also leading the ready-made feed market with a market share of 15%, corresponding to 400,000 tons, which is expected to increase to 600,000 tons by 2019”, says Péter Horváth, adding that grain trade is projected to reach one million ton.
What sets UBM apart from its competitors in addition to the foregoing, is that they have a particular focus on research and development, and the distribution of the most innovative products. In addition to strengthening their Slovak and Serbian contacts, they are also opening up towards Croatia, Romania and Austria. In Targu Mures (Romania), they are building Europe’s most modern feed mixer, to be completed by autumn 2018 and will also be launching a commercial company there this year and one in Austria next year. “We want to be the bridge between the GMO-free Serbian soy bean market and the equally GMO-free Austrian, German, and Swiss markets”, adds Péter Horváth.
“We have never copied anyone, and no one ever gave us a pile of money. We have grown from year to year, one step at a time. We did it by reinvesting our profits into the company. We did the same during the years of the crisis, when instead of cutting back on developments, we marched forward, a decision that was later supported by our results”, pointed out UBM’s chairman, underlining that “The profits produced by this sector have never been outstanding, but steadily decent.”