VIETNAM is rapidly becoming a hot-spot for offshore investment in meat processing infrastructure, with Brazilian meat giant JBS the latest to join the trend.

JBS has announced a US$100 million investment in two proposed processing plants, to be run under a joint venture with the Vietnamese Government.

The move follows a separate announcement made in February that Japanese investment giant Sojitz Corp had commissioned its new beef processing facility in Vietnam’s Vinh Phuc Province (see image above), proclaiming it to be the nation’s largest beef processing plant.

Brazil’s President Lula announced the JBS project during a visit to Indonesia in late March. In a statement, the company said the move was aimed at expanding its presence in the region and strengthening its position in the global market.

It appears the two facilities will not slaughter livestock, but will further process imported raw material.

The first will be built in Khu công nghiêp Nam Dình Vù, where JBS will build a logistics centre with storage capacity and infrastructure for pre-processing, cutting, and packaging. The second, similar facility will be built in southern Vietnam two years later.

The plants will process beef, pork, and chicken meat, using primarily raw material imported from Brazil and Australia, JBS said. The facilities will supply the Vietnamese market as well as other countries in Southeast Asia.

JBS said in the statement that the two Vietnamese plants are intended to expand the company’s presence in the region and to strengthen JBS’s position in the global market.

President of JBS’s Friboi business, Renato Costa, said the new factories in Vietnam will not only be an expansion of production capacity, but an investment with purpose: to generate value for the local economy, create qualified jobs, contributing to food security throughout South-east Asia.

“The partnership between JBS, the Vietnamese government and our local partners represents an essential strategic step for our geographic diversification. We are investing in the future, with a focus on innovation, sustainability and development,” he said.

Earlier, JBS announced big investments in Nigeria – the company’s first in the African continent – with plans to spend US$2.5 billion on six meat-processing facilities over five years – three for poultry, two for beef and one for pork.

Japanese investment

Meanwhile Japan’s Sojitz said its new Vietnamese abattoir and processing business near Tam Dao (see picture above) was the first in Vietnam to process chilled beef, and “all meat will be processed in a controlled, highly sanitised environment.”

The company said the new processing plant will be equipped to handle about 30,000 cattle per year, with the aim of increasing production of beef products to 10,000 tonnes per year. Such a level of production would require 40,000 to 50,000 cattle annually.

Sojitz is a Japanese investor with exposure to aerospace, automotive, renewable energy, mining, metals, chemicals and agriculture. In Australia, Sojitz is an investor in public infrastructure including roads, light rail and subway projects, the New Footscray Hospital and the Edenvale Solar Park on Queensland’s western Darling Downs. The company was the major investor in the Minerva coalmine in Central Queensland that closed in 2021.

In Vietnam’s current meat market, pork and chicken consumption is high, while annual beef consumption is only about 500,000t per year, Sojitz said during the beef plant’s December launch. By comparison, Japan’s annual consumption of beef totalled about one million tonnes.

“Most beef distributed in Vietnam is processed and transported locally at room temperature (hot boned) before being sold at traditional (wet) markets,” a Sojitz statement said.

“Moving forward, Vietnam’s population growth (100 million people as of 2023) and rising income levels are anticipated to increase the domestic consumption of beef. Due to diversifying consumer behavior from this economic growth, demand is expected to grow for high-quality domestic beef processed in a sanitised refrigerated environment.”

In 2021, Sojitz and Vietnam Livestock Corp, a division of Vietnam’s largest dairy manufacturer Vietnam Dairy Products (Vinamilk), established JVL, a joint venture company for a beef/dairy livestock business.

Starting in 2022, JVL began test marketing of imported Japanese beef before starting sales of Vietnamese-produced beef products processed at partner plants through supermarkets and restaurants in 2023.

The beef products from the new processing facility – mostly dairy bull and cull dairy cow meat -would be distributed using Sojitz’s cold-chain logistics service in Vietnam with plans to conduct sales to mid to high-end hotels and restaurants in the customer network of DaiTan Viet Joint Stock Co, which is Sojitz Group’s largest commercial food wholesaler.

The company has also shown interest in imported Australian cattle for feeding in slaughter through the new plant.