Miratorg set to double steak production capacity
This is expected to help the company increase supplies to both domestic steak houses and retail chains.
“Production capacity increased to 1t per day, as we see a strong demand for high-quality beef [in the Russian market]. Classic rib-eye and striploin can now be bought in supermarkets and federal branded retail outlets,” said Valery Samoylov, general director of Miratorg-Bryansk.
Miratorg is expected to sell more than 4,000t of premium beef cuts in the market this year, including rib-eye, striploin and tenderloin. This is more than the levels imported from Australia and the USA, before veterinary body Rosselkhoznadzor found them contaminated with anabolic steroid trenbolone and banned supplies in early 2014.
“Establishing supplies of premium cuts of beef with ‘prime’ grades of marbling to the retail chains is a logical step in our strategy, which aims to provide consumers with the widest choice of quality meat,” said Miratorg president Viktor Linnik.
Miratorg expects production of steaks to rise further next year, amid a general growth in capacity for the company’s beef project. The company has invested RUB30 billion (US$900m, based on the 2014 exchange rate) to create a beef ‘cluster’ in Bryansk Oblast.
“Next year we plan to double our production capacity to 80,000t, which will increase the availability of high-quality beef for buyers,” added Linnik.
Steaks in vogue
Industry observers believe that Miratorg has chosen the right strategy, as the market for premium beef cuts is growing in Russia, unlike the overall beef market.
“Miratorg intends to focus on the premium segment of the beef market, and that is quite a reasonable strategy,” said Russian agricultural expert Eugene Gerden. “At a time when, in general, consumption of beef in Russia is unstable and production has been in decline for a number of years, the premium products segment has a life of its own. Consumption of steaks in Russia came into vogue a few years ago and the potential to grow in this segment is by no means exhausted.”
Russian analysts also added that Miratorg could benefit from exchange rate shocks, which will force both steak houses and consumers to switch to domestically produced steaks.
A study on Russia’s premium beef market, conducted by the Federation of Restaurateurs and Hoteliers of the North-West Federal District, stated: “Steak houses are facing difficulties as their main product profile is premium imported chilled meat. The cost of these products is against a background of sharp jumps in the exchange rates and the certain banned products. As a result, prices for products are rising from one batch to the next.”
