Vinamilk and Vilico signed an agreement with Sojitz to develop beef cattle in Vietnam

On November 25^th, 2021, in Tokyo, Japan, Vietnam Dairy Products Joint Stock Company (Vinamilk) and its member company Vietnam Livestock Corporation - JSC (Vilico) successfully signed a Memorandum of Understanding (MoU) with Sojitz Corporation of Japan and the People's Committee of Vinh Phuc province on the investment and development of projects concerning beef in Vietnam.

The project has a total investment of approximately USD 500 million. The exchange between parties took place at Vietnam - Japan Investment Promotion Conference under the witness of Prime Minister Pham Minh Chinh on his official visit to Japan. This is the agricultural production project with the highest value signed within the framework of the Prime Minister's working trip to promote economic cooperation between businesses of the two countries.

The MoU mentioned the joint venture to invest in beef production - processing - distribution establishments in Vietnam to supply the national market and export. The next stages will present other protein-based products with deep processing technology with the expected cooperation scale of USD 500 million.

The first phase of the project is expected to come into operation in 2023 with a capacity of approximately 30,000 beef cattle/year, a closed processing facility equipped with modern technology. The cooperation scale between investors is approximately VND 3,000 billion, of which the total project investment in Vinh Phuc province is VND 1,670 billion.

At the signing ceremony on November 24th, Secretary of the Vinh Phuc Party Committee Hoang Thi Thuy Lan highly appreciated the projects implemented in Vinh Phuc which have helped Vietnam and Japan in general, Vinh Phuc and Japanese enterprises in particular promote and develop cooperation in agricultural in many aspects from technical cooperation, research and infrastructure development to joint ventures and direct investment in the field of high-tech agriculture.

In 2021, Sojitz Group and Vilico reached a cooperation agreement and established a joint venture namely Japan - Vietnam Livestock Company Limited (JVL) to carry out breeding, processing, importation and distribution of beef products in the Vietnamese market. Vilico owns 51% of the capital in this joint venture while Sojitz owns 49%.

Vilico is a company with a long tradition and long-standing brand name in animal husbandry, processing and distribution of meat products in Vietnam. After becoming a member of Vinamilk, Vilico has more advantages in financial resources, general management as breeding technology and advanced management system have been successfully applied by Vinamilk in many dairy farms according to international standards.

Sharing about the project's orientation, Mr. Trinh Quoc Dung - General Director of Vilico, Executive Director-Material Area Development of Vinamilk said:

“It can be said that this is a project converging all favorable factors. We have found a suitable partner that promotes each other's strengths. Japan’s advanced technology and deep experience combined with the strengths of Vinamilk's resources and markets will create superior and high-quality products at reasonable prices to serve and satisfy the growing needs of consumers.

“On the basis that Vinh Phuc province has created favorable conditions in terms of investment policies and encouraging the development of high-tech agriculture, along with resources, and methodical, long-term strategies from the parties, this project is expected to lay a solid foundation for new developments in the livestock industry as well as the processing of safe and high-quality meat products in Vietnam in the coming years.”

Sojitz Corporation is one of Japan's large-scale and fast-growing multi-industry corporations which has participated and invested in Vietnam for many years in the fields of fertilizer production, animal feed production, convenience food production, convenience store chains and logistics.

Sojitz is also currently one of the large-scale importers and distributors of beef from North America and Australia with strong marketing and business activities in the livestock sector.

Sharing more about the business strategy, Mr. Ryutaro Hirai, Vice Chairman of Sojitz Corporation, said:

“With the goal of building a stable food supply system in Vietnam and Southeast Asia, we will work together with our strategic partner to promote trading activities, combining the strengths of Vilico and Vinamilk with Sojitz's secret trading methods for livestock products.

“Through the establishment of this joint venture we hope to provide high quality, safe and reliable beef products to the Vietnamese market and vice versa, export Vietnamese beef products to potential markets in the future”.

This Memorandum of Understanding shows the importance of commercial cooperation between businesses of Vietnam and Japan, elevating the strategic relationship between the two countries not only in politics but also in economy.

About Vinamilk

Vinamilk is the leading nutrition company in Vietnam and the only representative of Southeast Asia in the top 50 dairy companies in the world in terms of revenue (ranked 36th). Vinamilk currently owns and manages 14 domestic dairy farms and 1 large-scale farm complex in Laos.

With a large production capacity from a system of 13 modern factories in Vietnam and 3 factories abroad, Vinamilk has exported products to 56 countries and territories. With an estimated value of USD 2.4 billion, Vinamilk is among the Top 10 most valuable dairy brands and the Top 5 strongest food brands in the world in 2021.

About Vilico

Vietnam Livestock Corporation- JSC (Vilico) is a member company of Vinamilk with years of experience in the field of agriculture, animal husbandry and meat and meat products processing and preservation as well as milk processing and dairy products preservation.

After more than 20 years of establishment and development, the company’s structure, scale and governance have now been more complete, approaching world standards. Vilico’s production capacity continues to increase and the technological level is improved which is reflected in socio-economic efficiency and increased competitivity. Particular brands such as Tam Dao Breeding Pigs or Moc Chau Milk with diverse and rich products have acquired their prestige and position in the market.

About Sojitz

Sojitz Corporation was established in 2004 from the association of Nichimen Corporation and Nissho Iwai Corporation - both companies with a long history in Japan.

At present, the Sojitz Corporation, consisting of 400 subsidiaries and branches located in Japan and worldwide, is developing the activities of a general trading company on a large scale in many countries and regions.