Ariant invests in Russian pork sector
Integrated pig meat company has announced plans to build new farms with capacity for more than 40,000 sows
Ariant Agricultural Holding, the largest agricultural holding in the Ural Region, is planning to launch nine new pig-breeding units, according to the Pork group of the Agricultural and Horticultural Development Board (AHDB) of the U.K.
Citing a report in Acexpert, it says three of the new units will be in the Yemanzhelinsky region with 20,700 sows and 6 will be located in the Uvelsky region with 19,900 sows. Both regions are in Chelyabinsk oblast in the Ural Mountains. Total investment in the project is RUB10 billion (US$151 million).
In 2015, Ariant is estimated to have produced 61,900 metric tons (mt) of pork (liveweight), an increase of 32 percent from the previous year.
Economy’s impact on Russian pork industry
The fall in the value of the Russian ruble over the last two years has led to a rapid increase in the price of food in the country, according to another recent report from Acexpert. The average inflation rate over this period has been 24.3 percent and some foods have become much more expensive. In the 12 months up to August 2015, the prices rose for pork (up by 10-15 percent), sausages (10-50 percent) and chicken (5 to 15 percent).
In August 2014, political issues caused Russia to impose a ban on imports of a number of food products – including meats, fish, seafood and dairy products – from the U.S., Canada, European Union, Norway and Australia. This ban remains in place until at least August of this year. In the meantime, Russia has been sourcing these foods from other countries, and its own agri-food companies have been investing to step up output to meet domestic demand.
In January, Bloomberg published an article that stated that Russian farmers are producing so much pork that they are selling it overseas just three years after the country was importing more of the meat than any other buyer except Japan.
In March, the USDA Foreign Agricultural Service (FAS) forecast that Russian pork production would increase a further two percent this year to 2.675 million metric tons (mmt) in carcass weight equivalent (CWE). In 2012, output was 2.175mmt.
FAS attributes this rise to production expansion by the country’s leading companies and to a sharp decline in imports. Inbound trade with year is expected to be down by a further 13 percent to 355,000 mt CWE this year. In 2012, Russia imported more than 1 mmt pork. Domestic pork consumption in Russia is forecast to remain flat in 2016.