Ekosem-Agrar has opened what the Russian milk producer says is its largest dairy facility in Siberia.

The site in the Novosibirsk region will have the capacity to house 6,000 dairy cows and produce 180 tonnes of fresh milk per day, according to a statement from Ekosem-Agrar, which is part of Russia’s Ekoniva Group.

A spokesperson for Ekosem-Agrar told just-food that the dairy, which has been given the name Elban, will only produce fresh milk rather than any value-added products, and will primarily supply the Russian market. 

In terms of customers, the spokesperson added: “We have a wide range of customers, from small local processors to world market players operating in the Russian market. This dairy cow facility exclusively produces raw milk and does not process the milk into dairy products. The group is currently building a large dairy with a processing capacity of 1,100 tonnes of raw milk per day.”

The Elban project will create 170 jobs.

“In total, the Siberian Ekoniva subsidiary now employs more than 1,000 people with three dairy farms and its other agricultural activities in the Novosibirsk region,” according to the statement.

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By GlobalData

Chief executive Stefan Dürr, the main shareholder of Ekosem-Agrar, said: “The newly-constructed facility in Novosibirsk is one of the world’s largest and most modern dairy cow facilities. We are thus setting standards in terms of efficient milk production and can almost double our milk output in the region to approximately 400 tonnes per day.” 

Another 15 facilities are also currently being constructed in seven regions across Russia with a total capacity of around 50,000 dairy cows. The projects are supported by the Russian government in the form of non-repayable subsidies and low interest rate loans.  

“Ekosem-Agrar is thus continuing its dynamic growth path to expand its market leadership in the Russian raw milk market,” the statement read. 

Explaining the strategy behind so many plants, the spokesperson told just-food: “The Ekosem Agricultural Group is currently pursuing a strong growth strategy, particularly in milk production. The reason for this growth is a current window of opportunity, mainly based on the strong support of the dairy sector by the Russian government.”

In a separate announcement yesterday (24 June), Ekosem-Agrar provided final figures for its 2018 financial performance.

Revenues were up 40% at EUR244.9m (US$278.9m), while adjusted EBITDA climbed 67% to EUR116m for a corresponding margin of 31%.

The company posted an EBIT result of EUR74.2m versus EUR44.5m a year earlier. Adjusted consolidated net income surged to EUR18.7m from EUR7.5m.

CEO Dürr said of the results: “The year 2018 has shown that we have reached a size and cost structure that allow us to successfully manage negative influences such as low raw-milk prices on the earnings side. This is all the more true as we are gradually expanding our value chain by setting up our own dairies. This enables us to tap additional revenue and earnings potential and reduce the influence of price fluctuations in the raw-milk market.”