With an overall capacity of about 5,000 tonnes (t) of meat per year, the project will be built near Voronezh city, according to a memorandum of understanding (MOU) signed on 3 May in Beijing by Russia’s agriculture minister Alexander Tkachev and China’s minister of agriculture Han Changfu.
According to representatives of the project, which was originally announced in 2014, but delayed several times, the new complex will consist of 100 rabbit farms with an overall population of 3.2–3.3 million head. The project also involves the commissioning of a meat processing plant.
Funding for the project will be provided by the The Export-Import Bank of China, according to reports. JSC International Rabbit Company CEO Alexei Emelianov said that the firm’s Chinese partners should bring valuable experience to Russia’s meat industry.
“China has achieved strong progress in terms of breeding rabbits, with an annual volume of 660,000t for this type of meat compared to just 10,000t in Russia,” he stated. “Once implemented, the project promises to become not only the largest of its kind in Russia, where, as of today, there are no facilities producing more than 1,000t, but also one of the largest in Europe.”
Young market
According to Emelianov, who is also the president of Russian Union of Rabbit Producers, there is a clear shortage of rabbit meat in the Russian market at present. Statistics indicate that, on average, Russian citizens consume only about 105 grams of this type of meat per year. However, industrial plants for the production of rabbit meat could give impetus to sector’s development.
“In the Black Earth [main agricultural region in the central of Russia], production of rabbits is carried out mainly in private or small farms, which use the field technology of rabbit growing. Each of these farms produces no more than 50t of meat per year and would not be able to achieve a substantial increase in capacity, due to extensive development, as well as a lack of automation in the production process,” explained Emelianov.
At present, JSC Kursk Rabbit runs the second-largest industrial plant for rabbit meat production. At the end of 2015 the company announced plans to launch production of 1,600t of rabbit meat, with an overall investment of about US$20m. However, to implement the project, the company first needs to find co-investor.
Representatives from JSC Kursk Rabbit said that, given current market conditions, the payback period of the project could be around 4.5 years. However, Emelianov suggested that, with fluctuations in currency rates, any similar projects could face a problem with their funding and payback strategy, as changes in the ruble exchange rate made such ventures hard to predict.