Russia-Meat plants for sale.

RUSSIA.

MEAT PLANTS MAY CHANGE HANDS.

There are 300 meat plants operating in Russia at the moment, mainly processing poultry and pork.

Artandus Koswaski, of Argentine Beef Packers, claims that by the end of 2009,over 200 of these plants will have changed hands.

"Profitability in these plants today is close to zero, as they cannot compete with imported meats that have risen in volume and price over three fold", According to Artandus.

Raisa Demina, of the Russian meat wholesalers Velkom, based in Moscow, said the bankruptcies have already begun and there will be many more before the spring.

There are grave reservations about the fact that foreign buyers may enter the market, encouraged by the government.

The Atria Group, from Finland, are already in the market place but the sudden meltdown of the economy in Finland, meant the government was technically insolvent, in fact the government of Prime Minister Putin, bailed out the government of Finland and their national banks.

Artandus said "there are seven large wholesale meat companies killing their own stock, that should remain strong, the rest of the market is really up for grabs, no doubt big foreign companies will be encouraged by the government".

Russia has been hit badly by the global economic meltdown, however the government is very cash rich with no trade deficit.

The government projected the 2008 budget on oil at US$70 per barrel, anything they have received over this was bonus.

Raisa Demina, believes that the government will use its mighty lending power to gain a stronger foot-hold in business.

He went on to say "In 1991 when we went into democratic government for the first time, the coffers of the Kremlin were empty and big business lent money to the virgin economy and Boris Yeltson, now the government is in a position to help the major players in big business and of course they will be selective".

Russia has strengthened ties with Latin America in recent months, there are three large Brazilian beef packers, well positioned to move into the Russia feed-lot and meat processing trade, if suitable conditions can be laid down before hand.