June 19, 2019

Cherkizovo Group to build 40 pig farms in Penza region, Russia


Igor Babaev, founder of Cherkizovo Group, Russia's largest manufacturer of meat products, and Ivan Belozertsev, Governor of the Penza region, Russia, unveiled the region's fifth pig farm of a new type.


The farm's opening ceremony was also attended by Alexander Lukyanov, Deputy Governor of the Altai Territory.


The Penza Region is of strategic importance for Cherkizovo Group, primarily as home to the company's major pig farming projects, Babaev said at the opening ceremony.

"Penza is the region Cherkizovo Group is banking on to develop its pork segment over the next five years. When we came here, the region's pork production was at best in its infancy. Today, the group manufactures over 30,000 tonnes of pork per year, accounting for 90% of the region's total pork output," said Babaev, adding that Cherkizovo plans to boost the production to 40,000 tonnes in 2019.


The new site marks the fifth pig farm of a new type in the region featuring combined wean-to-finish facilities with an annual output of 5,100 tonnes of live-weight pork. With an estimated RUB580 million (US$9.1 million) invested, each farm is designed to house over 20,000 pigs at a time, or up to some 50,000 market hogs per year.


According to Babaev, the number of sites may increase significantly subject to a favourable business environment, support from local authorities, allotment of land for construction and infrastructure development.


"Our goal is to bring pork production in the Penza region to 300,000 tonnes in the next five to seven years. To meet this ambitious target, we are considering building an additional 40 farms of this type in the region," Babaev said.

Thanks to Cherkizovo Group, Penza is among Russia's top ten meat producing regions, Governor Ivan Belozertsev said.


The company contributes significantly to the region's development and is set to become a key meat exporter.


Cherkizovo's investment projects in the Penza region will make it the top pork producer in the Volga Federal District, helping the group to take a prominent position among the regions exporting non-commodity products.


The group is also hoping that, in the foreseeable future, Russian companies will be allowed to export pork to China. Russian poultry exports to China have been underway since spring of 2019.


However, as the country grapples with the African swine fever (ASF) epidemic, there is an increased demand for pork in the Chinese market. Experts estimate that ASF may result in China's pork production declining by up to 30%.


"Therefore, we view Asia as our key export destination. We expect the Chinese market to open in the near future, creating lots of opportunities, of which we should be ready to take advantage. Russia has about 40 million pigs, an insignificant number compared with China's stock of 600 million animals. Still, we have great potential for boosting pork production and exports, benefiting from lower biological risks in Russia and the high quality and very competitive cost of our product," said Babaev.


- Cherkizovo