Rusagro expects Primorye enterprises to get right to export pork to China soon
MOSCOW. March 4 (Interfax) - Rusagro expects the enterprises of its pig-farming cluster in Russia's Far Eastern the Primorye territory to follow its Tambov Bacon company and obtain certification for pork supplies to China before long.
"This [certification of Primorye enterprises for export to China] is a matter of time. We expect it won't be long," Alexander Tarasov, director of corporate development for Rusagro Group of Companies LLC, said on a conference call on Monday.
Tarasov said the Primorye pig farmers might not have been certified due partly to an outbreak of African swine fever last year. "Yes, it's also related to this. I think if this had not happened then we might have received [certification] more quickly for the Primorye cluster," he said. But he said it was normal practice when it is not the group as a whole that is certified, but specific enterprises.
Tarasov said the group had dealt with all the consequences of the ASF outbreak in Primorye "and now the enterprises are operating at their usual capacity." Any increase will depend on the prospects for exports to China, he said.
Asked about margins on pork supplies to China, he said China was a premium market. "It all depends on the product, there is a 10-20% premium to the price within Russia. So we also believe that supplies even from the Central Federal District will be economically justified for us," Tarasov said.
He said Tambov Bacon's capacity would be sufficient for exports at first. Further decisions will be made depending on the performance of the exports.
Tambov Bacon plans to start shipments to China in March. "We plan to begin shipments to China in March. We already have agreements with potential clients, and a plan for interaction and contractual terms have been worked out," Tatyana Smirnova, director of the marketing and sales department for the group's meat business, told Interfax on February 28.
Miratorg and the Velikoluksky Meat Processing Plant have received permission to export to China as well as In Rusagro's Tambovsky Bacon.
Rusagro is Russia's biggest sunflower oil and margarine producer, second biggest sugar and industrial fats producer and third biggest pork producer.
It boosted sugar production 20% or 157,000 tonnes to 928,000 tonnes in 2023. Pork production fell 1% or 2,000 tonnes to 334,000 tonnes in live weight for slaughter.
Sales revenue grew 15% to 277.3 billion rubles, adjusted EBITDA 26% to 56.56 billion rubles and net profit more than 7-fold to 48.7 billion rubles.
The company's assets are located in 15 Russian regions, including Belgorod, Tambov, Voronezh, Kursk, Oryol, Sverdlovsk, Samara and Orenburg. Rusagro's land bank is 695,000 hectares.