Cherkizovo Group commences construction of integrated pig farm in the Tambov RegionMoscow, July 26 2006 - Cherkizovo Group OJSC, one of Russia's leading integrated and diversified meat producers, announced today that it has commenced construction of two integrated pig farm modules in the Gavrilovsky District, Tambov Region.
The designed capacity of the integrated pig farm, which will consist of two modules, is 25 thousand tones of meat per year. Each module is designed to simultaneously breeding 100 thousand pigs. Overall Group investment in this is anticipated to be approximately $80 million.
The first stage of implementation is anticipated to start in early 2007, with the first products of the Tambov integrated pig farm expected to be shipped at the end of 2007. The integrated pig farm will adopt modern Western production technologies, following a similar model of the Lipetsk integrated pig farm from Cherkizovo Group already in operation, which has capacity for 400,000 breeds and at present is the only pig farm in the Russian Federation organized in full compliance with modern international technological and veterinary standards.
The Tambov Region Administration has provided fundamental partner support by undertaking the laying of utilities to construction sites, including laying of roads and power and gas supply lines. A tender is currently in progress under American, Danish and US participation and the Company continues to review opportunities to purchase a highly productive pig breed in Europe.
Igor Babayev, Chairman of the Board of Directors of Cherkizovo Group OJSC said: "Laying the Tambov integrated pig farm is the first step to 'replicate' the modern European model of pig farm organization implemented by our company in Lipetsk in other RF regions suitable for livestock breeding development. Only such facilities built in accordance with international technological and sanitary norms are capable of ensuring a fast livestock breeding growth within a short time frame and industry competitiveness in view of Russia joining the WTO".
Sergei Mikhailov, Director General of Cherkizovo Group OJSC said: "The company continues to successfully implement the strategy of priority development of Group's pig farming block. Once the Lipetsk integrated pig farm, which will ship its first products at the end of 2006, reaches its full capacity, and the Tambov project is implemented, we will not only reach a full self-provision with refrigerated raw meat for our meet processing enterprise, but will start large deliveries of highly marginal European-quality refrigerated semi-finished meat products in the markets of the Lipetsk, Tambov and Moscow Region."
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