Aurora Organic Dairy executives will assist a Russian regional government in the establishment of the country’s first organic dairy farm and processing facility.
Moloko Holdings Inc - a multi-national venture involving the Ulyanovsk regional government - will establish and run the facility while Aurora Organic Dairy will hold an advisory role in the initiative.
An investment totaling more than 6bn rubles ($192m) will facilitate the construction of a farm to house 5,000 cows, and a milk processing plant. Once fully operational in mid-2015, the processing plant will boast a production capacity of 150 tonnes of dairy products per day.
According to Moloko Holdings, the processing plant will be run in accordance with international organic standards.
DairyReporter.com understands that organic milk and butter – exclusively for the Russian market - will be manufactured at the plant.
Organic dairy demand
Chief expert of Russian agriculture at analysis and trading agency Agrorucom, Vladislav Vorotnikov, told DairyReporter.com that consumer demand for organic dairy products in Russian is expected to explode in coming years.
Vorotnikov has attributed the anticipated growth to Russian consumer increasing interest in healthy living.
“Potential demand is currently estimated at up to 400,000 tonnes of organic dairy products and it will rapidly grow in coming years because a large number of Russian consumers are currently keen on the healthy food,” said Vorotnikov.
He added that through its collaboration with the regional government in Ulyanovsk, Moloko Holdings is likely to benefit substantially.
“Russian authorities have typical conditions of collaborations with the foreign investors on such projects. Firstly Ulyanovsk region could provide a preferential tax regime for the enterprise. It could also be provided access to communications, energy supply, and direct assistance on the construction of accommodation for employees of the farm,” Vorotnikov added.
Advanced organic production
Moloko Holdings Inc intends to target its products at mothers and children in need of “healthy organic dairy products."
“We are ready to introduce advanced organic technology, to share experiences regarding fixing of norms, rules and standards of organic production in the Russian market, which compliance allow to save all the useful properties, vitamins, amino acids and trace elements [of milk products] and deliver a natural, pristine product to the consumer,” said the firm.
"We applaud the effort to bring organic dairy products to consumers and retailers in this developing market," an Aurora Organic Dairy spokesperson added.