Investment costs in Miratorg’s pig cluster rise

By Vladislav Vorotnikov

- Last updated on GMT

Related tags: Kursk oblast, 2016, 2017, 2015

Miratorg's project will see it build the largest cluster of pig farms in Russia
Miratorg's project will see it build the largest cluster of pig farms in Russia
Investment in Miratorg’s large pigmeat factory in Kursk Oblast has reached RUB160 billion ($2.68bn), nearly 25% above original estimates, according to a report from the region’s Information Department.

In February 2016, when investment plans were revealed, the cost was estimated at RUB120bn ($2.01bn), but in August 2016 the regional Kursk government adjusted this to RUB132bn ($2.21bn).

Miratorg, however, has not disclosed the planned investment level for the Kursk pig cluster. Dmitry Sergeev, Miratorg’s press secretary, told GlobalMeatNews​ that, at present, the company was not providing any additional information to what had already been released.

ASF could be main challenge

In September 2016, Vadim Kotenko, Miratorg’s vice-president of finance, said the company had signed an agreement with the Kursk Oblast government on the implementation of the first stage of the project, including the construction of a meat processing complex, designed to handle 346,000 tonnes (t) of meat per year.

However, he admitted there were a few factors that complicated the entire initiative, citing primarily the African swine fever​ (ASF) epidemic, with several outbreaks of the disease taking place in Kursk Oblast in 2016.

Russia’s veterinary watchdog Rosselkhoznadzor revealed that several ASF outbreaks occurred in Kursk Oblast​ in August last year, with nearly 20,000 head of pigs culled as a result. On 30 December 2016, Rosselkhoznadzor identified sausage products containing the ASF genome at a number of marketplaces in the region.

Largest pig cluster in Russia

According to information from Miratorg​, the investment in its Kursk Oblast pig cluster includes the construction of 16 pig farms, two feed mills, a slaughterhouse and a meat processing plant. This would bring the capacity of the cluster to 4.5 million head of pigs per year or 13,500t of pigmeat per day. At the moment construction work is scheduled to complete by 2020, with the facility’s designed capacity expected to be reached by 2024.

This cluster is expected to become the largest pork production unit in Russia and one of the largest in Europe, Miratorg believes. In addition, 30-40% of pork products will be exported to south-east Asia in the future, it said.

According to estimates from the National Union of Pork Producers, in 2015 Miratorg produced 385,000t of pork, thus retaining its position as Russia’s largest manufacturer of this type of meat. The new cluster should double the company’s production volume, bringing it to almost 750,000t.

Work already underway

Meanwhile, the Kursk government said that Miratorg had already started some work on the project. In particular, of the 100,000 hectares (ha) the company required for the project, it has already registered rights for 97,200 ha. In 2017, Miratorg will also look to expand its feed crop farming in the region to 160,000 ha, added the regional government.

In earlier reports, Miratorg president Viktor Linnik said the company would begin construction on the project this spring, starting with the meat processing plant. This facility will have an investment value of RUB21bn (US$352m) and is scheduled to be operational by mid-2019.

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