Tyson Foods Might Expand to Kazakhstan

Tyson

Tyson Foods is reportedly in talks over a multibillion-dollar investment in Kazakhstan, a venture which according to The Financial Times could also open the doors for potential exports to China. The two countries share a nearly 1,800-kilometer border.

While the US is the world’s largest beef producer, sales to China have been disadvantaged since Beijing imposed a 25% retaliatory tariff in July last year, bringing the total levy to 37%. The value of US beef exports to China fell 17% year-on-year in the first quarter.

According to a Tyson spokeswoman, the company has visited Kazakhstan and is interested in the nation’s future food-production efforts. However, plans for the project have not formalized just yet. However, Tysons was in negations to set up a beef processing plant in the country, as part of the Kazakh government’s push to attract investment by selling itself as an agricultural powerhouse on China’s border. Chinese tariffs on Kazakh meat are reportedly 12%.

Sources familiar with the matter said that the meat giant has discussed an initial investment of about USD200m in the said plant. It would form part of a potential total investment that could run into several billion dollars, with ambitions to scale up production to 5m tons of beef a year.

The Arkansas-based meat giant generated USD4.8bn – or 12% – of its sales last year from outside the US, writes the report, and the company has prioritized expansions in the international markets. Tyson recently agreed on a USD340m deal to acquire chicken plants in Thailand, the Netherlands and the UK sold by BRF of Brazil.

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