Which Food and Beverage Companies Have Pulled Out of Russia?

by | March 14, 2022

The international response to Russia’s unprovoked assault on Ukraine has been swift and severe. More than 30 countries – representing more than half the global economy – have imposed sanctions on Russia. And these governments have gone far beyond the traditional economic penalties.

“The United States and governments all over the world are going after Putin’s cronies and their families by identifying and freezing the assets they hold in our respective jurisdictions – their yachts, luxury apartments, money, and other ill-gotten gains,” the White House announced soon after the invasion.

But you’d have to go back to South Africa’s apartheid regime to find such a comprehensive, international, private-sector effort to cut off a single country from the global economy.

The oil giants – BP, ExxonMobil, and Shell – moved quickly to unload their investments, followed soon by the most prominent players in the tech space, such as Apple, Microsoft, and Google. Other Western heavyweights – such as Disney, Ikea, and Nike – also paused its Russian operations.

“It’s really tough to do business in Russia under the best of conditions. Now it’s become just crazy. So, getting out is a smart business proposal,” James O’Rourke, professor of management at the University of Notre Dame’s Mendoza College of Business, told CBS News. “This is like going into business with the Manson family. Honestly, you do not want your name associated with those people, and it’s probably not going to cost you that much to disinvest.”

Food and beverage brands start retreat

Early, only a handful of food and beverage companies announced actions:

  • Budvar, a Czech brewer, stopped beer deliveries. It counts Russia among its top five markets.
  • Carlsberg, a Copenhagen-based Danish brewery conglomerate, suspended Ukraine production operations. However, the company hasn’t addressed its Russian operations.
  • Mexican bakery giant Grupo Bimbo announced the closure of its Dnipro plant, citing worker safety concerns. The company later pulled its investments from Russia.
  • Nestlé, the world’s biggest food manufacturer, announced it would halt production and distribution in Ukraine. The company operates three plants and employs more than 5,000 in the former Soviet republic. Nestle – and its joint venture with General Mills – suspended operations in Russia.

As hostilities persisted, other food and beverage companies started pulling out of the Russian market. Food giant Cargill cut off its Russian investments on March 11 and scaled back its operations. However, the company will continue some of its food and feed operations. Cargill added that it would ramp up its Ukrainian humanitarian efforts by sharing profits with the World Food Program, World Central Kitchen, Red Cross, Save the Children, European Food Banks Federation, and CARE.

Russia exodus continues

Other food and beverage companies that have since pulled out of the region include:

  • The Coca-Cola Co.
  • Kraft Heinz Co. also stopped exporting its products to Russia and all Russian imports.
  • McDonald’s Corp. shuttered all its Russian restaurants in Russia, for now.
  • PepsiCo Inc. not only stopped selling its beverages but stopped advertising, too.
  • Starbucks Corp. suspended its Russian operations on March 8 and stopped all shipments of its products to the country.

This is by no means an exhaustive list, and analysts expect it to get longer as the fighting wages on. Yale University professor Jeffrey Sonnenfeld and his researchers at the Yale Chief Executive Leadership Institute have compiled an exhaustive list of all the companies that have pulled out of Russia, which includes those who’ve remained.

We’ve built the world’s only Networked Ingredients Marketplace to help manufacturers find alternate suppliers quickly to avoid supply chain breakdowns. Find out how it works with a demo today.

Related Content

The New Gold Standard for Collaboration

The New Gold Standard for Collaboration

TraceGains Network is a collaborative platform where R&D, procurement, quality assurance, and regulatory ...
Why COVID-19 Hurt the Produce Industry and How It Can Bounce Back

Why COVID-19 Hurt the Produce Industry and How It Can Bounce Back

The pandemic has changed the produce industry forever and upended the way we consume food in the United States.
Aftershocks Rock the Supply Chain

Aftershocks Rock the Supply Chain

2020 shook the supply chain to its core. And while there are signs of recovery, aftershocks still resonate.

Pin It on Pinterest

Share This