Lithuania's Pieno Zvaigzdes denies plans to produce cheese in Russia

[February 19, 2018]  MOSCOW (Reuters) - Lithuanian dairy company Pieno Zvaigzdes said on Tuesday it had no plans to produce cheese in Russia after the local government announced it intended to do so.

A spokeswoman for Russia's Moscow region agricultural ministry said earlier Pieno Zvaigzdes could produce 12,000 tonnes of cheese per year starting next year, a move that would bypass a ban on some food imports.

"We inform that recent publications in the media that AB Pieno Zvaigzdes intends to invest in the Russian Federation and build a new cheese production factory are not correct", Chief Financial Officer Audrius Statulevicius said in statement.

"The company AB Pieno Zvaigzdes does not have such plans in the near future".

Russia is switching to producing more dairy products locally after the government banned some Western foods in 2014, including most dairy products, in response to sanctions imposed on Moscow for its role in the Ukraine crisis.

The ban has hit European dairy and other food producers, some of which have opened or expanded food production in Russia, including Finland's Valio.

Russian business daily Kommersant reported on Tuesday that the Lithuanian company might invest 1 billion roubles ($17.3 million) in the Moscow project.($1 = 57.8470 roubles)

(Reporting by Polina Nikolskaya and Denis Pinchuk; Writing by Denis Pinchuk; Editing by Katya Golubkova/Keith Weir)

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