“As soon as we find attractive items in terms of the types of products that can be produced here, we will consider the possibility of localising and transferring part of the production,” Linnik said.
Linnik explained that the presence on the Vietnamese market opens enormous export opportunities for the company. These include to Japan, Cambodia, South Korea, and Laos under free trade agreements between the Asian countries.
Miratorg began exporting pork to Vietnam in 2018 from its pig farms in Central Russia, including the Bryansk, Kursk and Kaliningrad regions. In 2022, the company sold roughly 30,000 tonnes of pork to Vietnam. This was substantially lower compared with the previous years, Linnik said. He attributes the negative sales dynamics primarily to logistics issues.
In the previous several years, Miratorg sold on average 50,000 tonnes of pork per year to Vietnam. This year, factors hampering export are expected to wind down, so Miratorg expects shipments to bounce back to nearly 60,000 tonnes, Linnik stated. “Vietnam is one of the biggest buyers of our meat. The largest volumes fall for pork, followed by beef and poultry. It was Vietnam that became the first country in Southeast Asia to allow Russian pork on its market. This underpins the role the Russian government agencies played in securing an admission for Russian livestock companies to the Vietnamese market.
This is not the first localisation project announced by a Russian pig manufacturer. In 2020, Russian major pork producer RusAgro rolled out plans to build several pig farms in northern China, not far from the Russian border. The company registered local subsidiaries Ros Agro Trading and Ros Agro China to manage the construction.
Maxim Basov, general director of RusAgro, said in 2021 that the negotiations had stalled due to Covid-19. He promised that talks would resume once the travel restrictions ended. He admitted later that a growth in local production could shape up the company’s localisation plans. There is no information on the current status of the project.
In December 2022, Russian president Vladimir Putin promised Russian pig farmers to help making their way into the Chinese market. Authorities estimated that Russian top pig companies could export nearly 500,000 tonnes of pork per year to China.