Russian government backs $1bn super-dairy
"The Russian Direct Investment Fund has signed an MoU with Middle Eastern, Thai and Chinese investors to establish Russia’s largest dairy.
The Russian Direct Investment Fund (RDIF) has signed a memorandum of understanding with Middle Eastern, Thai and Chinese investors to establish Russia’s largest dairy, in a deal worth about $1 billion, Agri Investor reports.
The new super-sized dairy will work across the supply chain, doing everything from cultivating feed crops to producing finished products.
China’s Banner Infant Dairy Products (Banner Dairy) and Thailand’s biggest agribusiness Charoen Pokphand (CP) joined the consortium, along with several unnamed Middle Eastern parties including banks, according to a press release.
An RDIF spokesman told Agri Investor that the fund also contributed to the investment, adding that co-investors are required to at least match investments by RDIF on a dollar-for-dollar basis.
Further financial details were not disclosed.
CP is leading management of the site, with support from Banner Dairy. The dairy will help Russia increase its domestic output and reduce milk imports, RDIF’s chief executive officer Kirill Dmitriev said in a statement.
Russia banned dairy imports from Europe and the US following the Ukraine crisis.
"Russia is one of the world’s largest milk producers … however, its production processes are not very efficient," Dmitriev said. "Through the use of modern dairy technologies, cows in some countries produce almost two and a half times more milk than in Russia."