“Probably from next year, we will start supplying beef cuts to McDonald’s for the production of the new Black Angus burger. We expect it will cost 20-30% more than the other burgers in the fast food chain,” said Miratorg vice-president Alexandr Nikitin.
The new agreement forms part of the company’s expansion into Russia’s beef industry, as Miratorg plans to increase production volumes of beef from 50,000 tonnes (t) in 2015 to 130,000t by 2020, leading it to account for 30% of the sector. In addition, Miratorg hopes to gain a foothold in the HoReCa (hotel/restaurant/café) segment and launch large-scale export supplies.
“Miratorg plans to increase deliveries to the Russian market and is ready to cooperate with all market participants in the HoReCa sector. Whatever segment of the market they work in, there will be enough beef for all,” said Miratorg president Viktor Linnik.
“We have been working with McDonald’s for some time, supplying chicken nuggets and patties for burgers. Now we are also preparing to supply beef cuts. The recipe is a secret of McDonald’s, and we guarantee that we grow animals without hormones and growth stimulants, only using natural feed to the most stringent quality standards.”
Export potential
Miratorg also believes its beef project could have great export potential. The company already has plans to export beef to China.
“[China] is an important market for Russia, and we will make every effort to open it for the country. I hope that, by the end of the year, we will be able to enter this market with our products. After that we will also target Japan, Canada and Brazil. If sanctions are eventually withdrawn, we will also try to enter the European Union,” added Miratorg co-owner Alexandr Linnik.
He noted that, a few months ago, China’s chief veterinarian visited Miratorg’s facilities and confirmed that the production process taking place was in compliance with China’s veterinary standards. “I would call this the final stage of negotiations. Yet it will take two or three months to launch the first supplies,” he added.
Alexandr Linnik also noted that, next year, the company aims to export 10-15% of all its products. He said the company would produce and export products that were not popular in Russia, in particular by-products. The company is aiming to triple the volume of meat exported to China bringing it to 2,000t of pork and beef per month. So far, Miratorg exports just 600-700t of pork per month to China.
The company also plans to increase its land from 300,000 hectares to 530,000 ha by 2020. The overall investment is expected to run to RUB73 billion (US$1.1 billion).