Russian pork giant Miratorg aims to double its meat
production from a forecasted 500,000 tonnes in 2016 to 1 million tonnes in
2020. The investments should boost turnover to US$ 4-5 billion, being currently
For a large part, the increased meat output should be sold
on the domestic market, Miratorg aims for an increase by about 400,000 tonnes.
2016 pork figures
In first quarter of 2016, Miratorg produced 99,000 tonnes of
pork, a 6% year-on-year increase. The company states that its main emphasis has
been on efficiency improvement, pig feeding efficiency and cost reduction.
This should all lead to a competitive advantage over Russian
pork producers. In a company press release, Miratorg CEO Viktor Linnik
estimated that, by 2020, this competition will have led to the disappearance of
dozens of ineffective producers, together producing about 1 million tonnes of
pork per year.
Improving of efficiency and several other measures for
reduction of market price, including development of company's own retail chain,
will let company to feel comfortable in the coming competitive war at the pork
market, as with the reduction of pork consumption among Russians over recent
two years it already now closed to saturation.
Focus on Asia
Linnik said that implementation of these plans will also
provide a significant increase of export supplies, which should be increased
ten-fold in this timeframe. Currently about 5% of overall production is
exported, being about 25,000 tonnes in 2016. In 2020, the company aims for
China: accounting for half exports
Linnik explained that in the last 5 years, Miratorg
executives and Russian officials have regularly paid visits to China in order
to lobby for the annulment of trade barriers for Russian pork.
Should this indeed be the case, then Miratorg management
estimates that by 2020, China could account for half of the company's meat
exports (roughly 125,000 tonnes). Until now, the company has reached this
market indirectly via Hong Kong (about 2,000 tonnes per month). Even without
the lifting of trade barriers, the company hopes to triple this figure in 2016.
Pork exports to Asia
The remainder of pork exports to Asia should go to e.g.
Vietnam, Thailand and the Philippines. The weak rouble should be a factor
supporting export development, Linnik said, as its devaluation reduced the cost
of Russian pork in hard currency nearly by two in recent years.
In 2015, Miratorg received permission to export meat to
Iran, the United Arab Emirates – mostly useful for poultry exports.