Kusto Group’s Yerkin Tatishev and American Tyson Foods to Build a $300 Million Meat Factory in Kazakhstan

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The enterprise, established in cooperation with the Government of the Republic of Kazakhstan and which will be located in the Almaty region, is slated to process 500 thousand head of cattle per year.

Prime Minister of Kazakhstan Askar Mamin on a recent visit to KazBeef's new meat processing facility
Prime Minister of Kazakhstan Askar Mamin on a recent visit to KazBeef’s new meat processing facility.

More details involving plans for the construction of a meat factory became public knowledge during a meeting of the governor of the Almaty region, Amandyk Batalov, with representatives of the American multinational corporation Tyson Foods and their partner in Kazakhstan, the multi-sector and investment company Kusto Group. The meeting was attended by the Vice Minister of Agriculture of the Republic of Kazakhstan, Gulmira Isaeva, the leaders of 11 large farms in the region, and others according to information provided by the press service of the governor of the region.

The future plant has a design capacity of 2 thousand head of cattle per day. The company will work in two shifts, with the number of employees needed projected to be up to 4 thousand. In general, thanks to the accompanying business, the company is expected to create up to 20 thousand jobs in the region. The total project cost is estimated at $300 million.

A commitment to fostering growth and creating new opportunities

“For our part, we will provide all the necessary support,” Governor Amandyk Batalov assured. “Thanks to government business support programs, we have great opportunities. We will help with the issue of training. We will provide a budget for training in the necessary specialties. My colleagues will present to you the options available for placing a meat factory. Of course, I would like the large-scale production facility to be built in Taldykorgan (the capital of Kazakhstan’s Almaty region). But in general, we have many options throughout the Almaty region.”

The governor instructed his deputies to continue detailed work on the project. Representatives of the American company confirmed that they are also ready to train local specialists on the basis of their existing production facilities and methods used in the United States. Shane Miller, CEO of Tyson Foods Inc.’s beef production company, announced at the meeting that the company is ready to cooperate with both large and small farms.

According to Miller, the company’s turnover amounted to more than $42 billion last year. The company specializes in four verticals, with the beef division being the largest, employing 38 thousand out of 140 thousand total employees. In the USA, the corporation has six meat processing plants, which process more than 7.5 million heads of cattle annually. Tyson’s products are sold in 80 countries worldwide.

Realizing Kazakhstan’s agricultural potential

On the essence of the project, Yerkin Tatishev, Chairman of the Board of Directors of Kusto Group (a multinational company headquartered in Singapore with strong Kazakh roots), expressed his confidence that the existing meat potential of the region will allow for the successful implementation of this important investment project. Tatishev has a reason for this confidence. In 2017, Kusto Group became the main shareholder of KazBeef, a leading producer of high-quality beef with a capacity of 6 thousand tons per year.

Tatishev is one of the champions of the effort to create and develop an integrated protein industry in Kazakhstan. According to him, Kazakhstan has the potential to produce 10 million tons per year, with the current output at 80 thousand tons.

“Kazakhstan has the chance to enter the top five producers of high-quality protein in the world – this is what our American partners tell us when we discuss future plans. According to them, our country today is the only one in the world that is able to follow the American path of development of animal husbandry. That is, to conduct fattening based on corn and soy. Our lands provide us such an opportunity. Therefore, I believe that the future of Kazakhstan rests in the agricultural industry,” said Tatishev in a Forbes Kazakhstan interview last September.

According to Tatishev’s calculations, with the proper scientific and organizational approach, Kazakhstan will be able to produce enough meat to feed 2 billion people.

Strengthening the partnership between Kazakhstan and the United States

“Our recent projects with Tyson Foods, Valmont Corporation, and others to bring state-of-the-technology to Kazakhstan are, as the Kazakh Prime Minister Askar Mamin himself has said, a major step forward for the country,” says Daniel Kunin, a managing director at Kusto Group. “They bring jobs, know-how, increased efficiency, better yields, enhanced predictability and, perhaps most importantly, a commitment to sustainability that is fundamental for agriculture to succeed. The future in agriculture is all about sustainability.

“Kazakhstan is already a major exporter of wheat – a legacy of the Soviet period – and the next step is to diversify crop exports and expand and develop Kazakhstan’s protein production, particularly beef and lamb. What is required is capital, hard work and entrepreneurs who are willing to deploy it effectively. That’s where we come in, together with our partners and the other stakeholders.”

On a recent visit to the capital of Kazakhstan, US Secretary of State Mike Pompeo reaffirmed the strategic partnership between the two countries. American investment in Kazakhstan has measurably increased in recent years. In 2018, bilateral trade reached $2.1 billion, totaling a 57 percent increase over 2017. As of July 2019, U.S. foreign direct investment amounted to 18.5 percent of the total foreign direct investment in Kazakhstan, with investments of nearly $31.23 billion.

The investment of Tyson Foods in the country’s agricultural sector signals the expansion of American investment beyond the oil and natural gas sectors, which have traditionally dominated the Kazakh economy and accounted for the primary source of foreign direct investment.