Vietnamese dairy company TH Milk has broken ground on a new integrated milk-processing factory in Russia’s Kaluga region, which will produce more than 300,000 tons of milk per year. The ground-breaking ceremony was attended by representatives of the Russian Direct Investment Fund (RDIF), the sovereign wealth fund of the Russian Federation, as well as Thai Huong, the founder of TH Group, the largest Vietnamese agricultural conglomerate.

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TH Milk’s investment totals US$633 million and is the largest single investment by a Vietnamese company in Russian agriculture. The project will utilise end-to-end milk processing technology, involving a complete production chain from growing fodder and milking herd to the production of raw milk and its processing into a wide range of final dairy products. The project provides innovative solutions for increasing the productivity of milking herd, as well as modern technological solutions, including automatic feeding and milking systems.

 

From cow to cup

 

RDIF and TH Group also plan to announce the completion of a deal to build integrated dairy complex in both Moscow and Kaluga regions by the end of 2018. The launch of the first farm for the production of raw milk in the Volokolamsky district of Moscow took place in the first quarter of 2018, while the launch of the remaining four dairy farms in the Moscow and Kaluga regions is scheduled for 2019 and 2020. The facilities for the production of dairy products and a proprietary distribution network are expected to be launched in 2020. By 2025, the company plans to reach full production capacity and take a leading position in Russia in terms of the volume of raw milk production.

 

RDIF and TH Group are also considering construction of dairy plants in other regions of Russia as part of the partnership, including regions in the far east of the country.

 

Kirill Dmitriev, CEO of the Russian Direct Investment Fund (RDIF), noted: “RDIF’s partnership with leading Asian manufacturer TH Group will promote innovation in dairy production and have a positive impact on the development of the Russian dairy industry. Our joint investments have important social significance – the creation of new high-tech dairy plants will help to reduce the deficit of dairy products in the Russian market and provide consumers with high-quality domestic products.”

 

Thai Huong, Founder of TH Group, said: “TH produces agricultural products of international quality standards. The cooperation of RDIF and TH Group will make a significant contribution to the restructuring of Russian agriculture, giving Russian consumers the most benefit, which are good and healthy products purely from nature from their own land, and to give the Russians the right to be proud of their land.”