RVI New Zealand Limited, an Auckland vodka retailer, is planning to invest up to US$35 million in the construction of a beef processing plant in Maikop, Russia.

Most of the funds will be provided by foreign banks, while raw materials for the plant will be supplied from New Zealand and Australia.

The new plant will have a capacity to process about 4,000 tonnes of meat per year, and construction is scheduled to complete by 2013. The company will import semi-finished meat from New Zealand and Australia, but it is expected to set up its own farms in Russia.

The project will take around 8-10 years to break even, Russian analysts said.

RVI would be better positioned if it focused on large cities where well-developed restaurant industry and retail are located, according to Mushegh Mamikonian, president of the Russian Meat Union.

"There is a strong demand in the restaurant and retail sector for high-quality beef cuts that are not practically produced in Russia," Mamikonyan added.