Russia's leading snacks producer to build fish factory in China

June 25, 2007 12:25

One of Russia's leading snacks producers Sibirsky Bereg Company is planning to build a factory for production of dried fish and squid in China. The company's experts think this segment of the snack market has a greater potential that production of salted rusks.

According to Investmemorandum published on the threshold of placement of the firm's bonded debt of RUR1.5 billion, Sibirsky Bereg is planning to invest 5.6 million USD into construction of the fish factory in China. Seafood is a promising segment of the snack market which has been continuously growing in the recent six years, the memo says. According to the company, the potential of salted rusks market has been decreasing with its capacity through the last year falling from 356 million to 308 million USD.

The firm's PR director Konstantin Lykin says that the company has already purchased a site for the future factory in the Chinese province of Shandung. The factory will produce dried fish and squid under the TM BEERka with the facility's capacity per month exceeding 400 metric tons.

The company entered the Chinese market in 2005 when it purchased 40% of the local factory Yantai Fuxingkang Foodstaff. However, the company says it is not bent on winning the Chinese market. More than 90% of the new factory's output will be sold on the Russian market. The location of the new factory has been chosen due to the vicinity of the raw material landing points and efficiency of the workforce. Production of seafood snacks provides for use of hand work and the Russian owners say that the Chinese workers do their job quicker and better than the Russian workers. In particular, the company's production targets at Yantai Fuxingkang Foodstaff have been always ahead of schedule.

The firm's competitors think its decision quite sensible. More specifically, manager of the company Dalnie Ostrova producing packed seafood forecasts that the market capacity will grow by 20% year on year. He also says that the Shandung province is a good place for seafood factories, e.g. Jia Bao factory, which is one of Russia's largest suppliers of seafood, is located in the province.

The seafood market has been actively growing thanks to the overall drive towards healthy food, which is actually not associated with salted rusks, according to PR-manager of Magnam Market Research Antov Prostyakov.

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