Australian cattle and sheep processor V&V Walsh has entered a joint venture with Grand Farm Group, one of China’s largest red meat importers. The deal will see Walsh process an additional 50,000 lambs ad 30,000 head of cattle per year and will include a $200 million Chinese investment into Western Australia to increase lamb and beef production and improve facilities, and an $800 million investment into Inner Mongolia for the development of state of the art feedlots, research center, processing facilities and feed network systems. Over five years investment into the deal would reach $1 billion. The groundwork for the deal has already been completed in China and V&V Walsh is in the process of obtaining a license to export Western Australia beef to China. Final stages of building and the approval of the license should be ready by September. For every additional 1 kilogram of lamb consumed in China per capita, an extra 65 million lambs will be needed, and for every additional 1 kilogram of beef consumed per capita in China, an additional 65 million head of cattle will be required. The only concern Walsh has pertaining to the deal is sufficient supply.
To receive relevant news stories with summaries provided by GAI Research & Insight, subscribe to Global AgDevelopments, our free weekly enhanced eNews service