TH Group's milk project in the Far East - Russian Federation

On May 21, 2024, TH Group commenced a dairy cattle farming and milk processing project with a total investment of 19 billion rubles (over 5,200 billion Vietnamese dong) in Nikolo-Mikhailovka village, Yakovlevsky district, Primorsky Krai territory (Far East, Russian Federation).

The project includes: the construction of a farm with a scale of 6,000 dairy cows (total herd of 12,000 cows); the construction of a milk processing plant with a capacity of 250 tons/day; and the exploitation of a raw material area covering 13,000 ha.

This is a significant milestone in TH Group's milk project implementation process in the Russian Federation, following the success in Kaluga and Moscow provinces, where TH farms and factories are considered key economic development projects of the provinces. The newly commenced project is expected to revive the great agricultural potential that has long been overlooked in the Far East.

"The first items of the dairy cattle farm - the warm home for 6,000 dairy cows in the near future - will soon be implemented. To carry out the herd development plan, we commit to clearing the entire 13,000 hectares allocated by the Primorsky authorities to ensure feed for the entire herd," said Mr Ngo Minh Hai, Chairman of the Board of Directors of TH Group, at the groundbreaking ceremony.

Mr Hai stated that by the end of 2027, when the dairy plant becomes operational, 100% of the input materials will be supplied from the cluster of farms, forming a closed-loop production chain applying advanced technology "from pasture to milk glass," contributing to the growth of the overall product of the Primorsky region.

In addition to dairy cattle farming and milk processing, the TH Group also cultivates crops such as alfalfa and soybeans for export to potential markets.

Attending the groundbreaking ceremony, Mr Nguyen Dang Hien, Consul General of Vietnam in Vladivostok, assessed that this is the first project of a Vietnamese company investing in this region, marking a new development step in the economic cooperation between the two countries in recent years, despite the challenges posed by the Covid-19 pandemic and the political fluctuations in the world.

"I believe that with the efforts and determination of TH Group and the love for Russia of Ms Thai Huong personally, the project will soon be put into effective operation, bringing tangible economic value to both Vietnam and Russia, enhancing the comprehensive strategic partnership between the two countries," Mr Nguyen Dang Hien said.

Meanwhile, Mr. Korenchuk Alexey Alexandrovich, the Head of Yakovlevsky District where TH Group's project is located, expressed expectations for changes in this land after TH's project becomes operational. "Thank you to TH Group for implementing the dairy cattle farming and milk processing project here, which will definitely create more job opportunities for local people. In the Primorsky region, from my observation, TH's project of 6,000 dairy cows is the largest dairy cattle farming project. The rest mainly consists of small-scale or household farms for beef cattle, pigs, and poultry," Mr. Korenchuk Alexey Alexandrovich told the press.

Upon hearing about TH's projects operating in Moscow and Kaluga, the District Chief was surprised to learn that TH's average milk yield per cow per day is 40 litres, while the average milk yield per dairy cow in Russia currently only reaches 25-30 litres per cow per day.

Thanks to high-quality genetics and the application of advanced technology and management science, TH's cattle in Russia have one of the highest average milk yields in the country. The raw milk from TH's farms is currently sold to the largest milk companies in Russia at the highest prices in the market. These are the most important indicators for evaluating the effectiveness of the project, leading to costs reaching the best competitive level.

Superior thinking, seizing the golden opportunity

The Primorsky Krai coastal territory, with its administrative centre in the city of Vladivostok, has the largest economy in the Russian Far East. This is the gateway connecting Russia with the Asia-Pacific region, as affirmed by Russian President Vladimir Putin as an absolute priority area for Russia in the 21st century.

Russia has implemented many preferential policies to support the development of projects and attract foreign investors in this region, notably preferential policies for agriculture. Alongside continuous improvements in infrastructure, logistics, energy, etc. In 2023, the trade turnover between Vietnam and the Russian Far East reached $257 million, of which the Primorsky region with the ports of Nakhodka and Vladivostok accounted for about 65% of this turnover - about $167 million. TH Group, a Vietnamese company led by Labor Hero Thai Huong - Chairman of the Strategic Council of TH Group and chairman of the Vietnam Women Entrepreneurs Association, is one of the investors recognizing the potential and opportunities in this region.

From the very beginning, Ms. Thai Huong, with her superior thinking, knew how to seize the golden opportunity in business. She considered the Far East region a priority in TH Group's investment project in the Russian Federation – a project seen as a noble gesture of gratitude to the country that had spared no effort in assisting Vietnam during wartime.

Overcoming difficulties

Due to the geographical characteristics, the areas where TH's projects are implemented in Primorsky Krai face many challenges, as many plots have low-lying terrain and lack infrastructure such as electricity, roads, and gas. Most of the agricultural land has been left fallow for many years and is in a flooded state due to the lack of drainage systems or the old drainage channels being filled in. It requires clearing and constructing dams to prevent river water from overflowing into the production areas during the snowmelt or rainy seasons.

Mr Ponomarev Vitaly Stanislavovich - Head of the Investment Project Support Department of the Far East and Arctic Development Corporation (KRDV), stated that TH Group has been receiving comprehensive support and collaboration at all stages from the Ministry for the Development of the Russian Far East and the Far East and Arctic Development Corporation.