Construction of Major Lactoferrin Plant in Russia Indefinitely Halted
Source: The DairyNews
The construction of a major lactoferrin plant in the Nizhny Novgorod region of Russia has been postponed indefinitely by Brazilian fund Capital Participacoes E Investimentos. Initially set to be one of the world’s largest lactoferrin production facilities, the plant's development has encountered significant challenges.
Lactoferrin, a protein naturally present in the milk of humans, cows, and other mammals, is known for its antiviral and antibacterial properties and its role in iron absorption. It is extensively used in bioactive supplements, human nutrition, infant formula, and cosmetics. The plant, under an agreement signed in 2023, was to process 670,000 tonnes of milk annually, with a projected investment of 120 billion rubles (US$1.5 billion).
However, according to a report by local newspaper Kommersant, the Brazilian investors have begun liquidating their Russian subsidiary. Despite this, the Nizhny Novgorod regional development corporation, a body that facilitates investments, has not abandoned the project completely. The regional government is actively seeking local investors to continue the venture, although Russian analysts have described the project as “ambitious, but unlikely to be implemented.”
Challenges and Future Prospects
Dmitry Matveev, owner of the prominent Russian dairy processor Kabosh, highlighted the operational demands of the plant, which would require about 35 tanks of milk per day. Matveev expressed doubts about the Brazilian investors' capacity to realize these plans.
The Nizhny Novgorod region's relatively low raw milk production poses another significant challenge. Currently, it is not among the top 15 Russian regions in terms of raw milk output, raising concerns about sourcing sufficient raw material for the lactoferrin plant. The project's postponement could also impact the regional economy, as it was anticipated to create numerous jobs and boost local milk production.
Artem Belov, general director of Soyuzmoloko, a Russian dairy industry union, remarked in 2023 that the plant's success would hinge on its focus on exports rather than the domestic market. He estimated the global lactoferrin market at US$200 million, with potential growth to US$500 million by 2026-2027.
Official Statements
Regional authorities revealed that they are clarifying the technical and financial details of the project while negotiating with potential Russian partners. The future of the lactoferrin plant remains uncertain, but efforts to revive the ambitious project continue amidst these challenges.
However, according to a report by local newspaper Kommersant, the Brazilian investors have begun liquidating their Russian subsidiary. Despite this, the Nizhny Novgorod regional development corporation, a body that facilitates investments, has not abandoned the project completely. The regional government is actively seeking local investors to continue the venture, although Russian analysts have described the project as “ambitious, but unlikely to be implemented.”
Challenges and Future Prospects
Dmitry Matveev, owner of the prominent Russian dairy processor Kabosh, highlighted the operational demands of the plant, which would require about 35 tanks of milk per day. Matveev expressed doubts about the Brazilian investors' capacity to realize these plans.
The Nizhny Novgorod region's relatively low raw milk production poses another significant challenge. Currently, it is not among the top 15 Russian regions in terms of raw milk output, raising concerns about sourcing sufficient raw material for the lactoferrin plant. The project's postponement could also impact the regional economy, as it was anticipated to create numerous jobs and boost local milk production.
Artem Belov, general director of Soyuzmoloko, a Russian dairy industry union, remarked in 2023 that the plant's success would hinge on its focus on exports rather than the domestic market. He estimated the global lactoferrin market at US$200 million, with potential growth to US$500 million by 2026-2027.
Official Statements
Regional authorities revealed that they are clarifying the technical and financial details of the project while negotiating with potential Russian partners. The future of the lactoferrin plant remains uncertain, but efforts to revive the ambitious project continue amidst these challenges.
