Export–import business the import plan of frozen pork

Currently, due to disease impacts, the rising price of pork has made the domestic pork purchasing power decrease sharply while the demand for meat is still very high.. Facing this situat

DA NANG UNIVERSITY

DA NANG UNIVERSITY OF ECONOMICS

-THE IMPORT PLAN OF FROZEN PORK

Course: Export–Import Business

Lecturer: Duong Hanh Tien

Group 7-Class 43K01.2

Da Nang, 6/2020

Chapter I Import product introduction

I.1 Product

I.1.1 Select Product:

 Product name: Frozen pork

 HS code: 020329

 Product description:

Pigs that are qualified for kilogram standard will be preliminarily processed and slaughtered, and then taken to the cooling room with the temperature from -25 degrees

C for 10 minutes, to lower the body's temperature Pork is stored in cool meat storage

to ensure biochemical ripening Cool meat is given to demolish, preliminary processing in conditions of not more than 7 degrees C After being separated into separate parts, freezing at temperatures of -45 degrees Celsius, depending on the parts that time freezing Finally, the meat was brought into the storage room at the temperature of -22 degrees Celsius The whole process of transporting, preserving and displaying meat was guaranteed the temperature at -18 dollars C to - 22 degrees Celsius

Frozen pork is controlled by each process from standard pork, slaughter, storage The targets of frozen meat are higher than other criteria of hot meat Quality is only reduced a little bit, about 95% to 97% of quality According to nutrition experts, frozen meat is stored at -18 degrees Celsius, which is to limit the harmful bacteria, bacteria can not completely penetrate the meat Therefore meat almost retains its flavor, as well as the nutritional content of meat

Pork in general is a familiar food for Vietnamese cuisine For frozen pork, it will be an optimal replacement for consumers' needs to improve the quality of meals and consumption habits in the face of economic difficulties

The price of frozen meat is currently on sale from 80,000 VND to 150,000 VND per 1

kg of meat, 5% - 10% lower than the market meat

I.1.2 Domestic demand with the product

Proactive approach: selection of a product based on immediate (short-term) market need.

Currently, due to disease impacts, the rising price of pork has made the domestic pork purchasing power decrease sharply while the demand for meat is still very high The obstacles in people's pork consumption mainly come from price Facing this situation, the import of frozen pork is a very beneficial job:

- Meeting the urgent needs of the market: the price of imported pork is cheaper

than domestic pork, people can buy without concerning about the price

- Imported pork price is lower than domestic price to help enterprises compete

on price better

- Importing after observing and seeing an urgent demand of the market helps

limit business performance risks

Besides, there are some disadvantages:

- Vietnamese people have a habit of using fresh meat, so the demand and frozen

meat products are still limited => costly for marketing products and must choose the appropriate import method

- This is a frozen product, so it is necessary to research and choose a reputable

supplier to ensure a clean and quality source of goods for consumers => Costly research and choose a reasonable supplier

Chapter II Potential supplier selection

II.1 Selecting potetial product

Exporter Value

exported

in 2019 (USD thousan d)

Quantit

y exporte

d in 2019 (tons)

Unit value (USD/

ton)

Growth

in importe

d value between 2018-2019 (%)

Share in Vietnam

’s import

Averag

e distanc e

Averag

e tariff (%)

Brazil 24,216 12,384 1955 87 31.5 13505 15

United

states of

America

Russian

Federatio

n

Based on the unit price, Poland, Australia and the Russian Federation (the lowest) are worth considering, because the choice of importing frozen pork from the market with low unit prices will create better conditions to compete price when selling in the domestic market

In terms of import tax rates, it can be seen that the average tax rate applicable to the import of frozen pork from Australia and the Russian Federation is the lowest

In terms of growth in the value of imports of frozen pork imported from Australia at 73%, it proves that its price increased sharply

Between Australia and Russian Federation: For Australia the unit price of the product is 1126 USD / ton, higher than the Russian Federation, in addition to the growth in the import value of frozen pork imported from Australia in High level, from which we can see that the Russian Federation market is the most potential for importing frozen pork

II.1 Selection of potential supplier:

II.1.1.Summary

Characteristics Miratorg Rusagro

corporation Cherkizovo Group Position Number 1 pork producer in Russia The third biggest pork producer in

Russia

Top three industrial pork producers in Russia

Production system

A series of their pork production facilities are considered to be the best in Russia

Operate in compliance with world standards and use advanced pig production and feeding

technologies

Professional and responsible approach at each stage of the value chain

Product quality Meet NAASR ISO 9001 and ISO

14001

High-quality products

According to FSSC (Food Safety System Certification) and ISO 9001 standards

Comment The most potential supplier Little information, less exported to

Vietnam

Main export products are chicken, not intensive into pork

II.1.2.Analysis

 Characteristics

Number 1 pork producer in Russia: Pork is the second most popular in Russia.

Miratorg has been an unrivaled leader in this meat market segment since 2010 The overall investment in pork production is 63 billion rubles The output of 3.4 million heads per year, 321 thousand tons per year

Production system: A series of their pork production facilities are considered to be

the best in Russia: 28 automatic pork production facilities, in clean environmental areas in Kursk and Belgorod, including reproduction, fattening and rearing units Each pork production facility is a closed, high-tech manufacturing center, including livestock, breeding, and farming facilities A facility of 138,000 key employees, 3800 highly qualified professionals and efficient methods of production based on the latest scientific advances allows the company to produce effective numbers manufactured

in accordance with the world's leading enterprises

Product quality: All Miratorg pork producers are certified according to ISO

international standards (NAASR ISO 9001 and ISO 14001) and equipped with the latest generation of modern equipment Under the close supervision of experienced agricultural technicians, Miratorg plants all of their main crops, which are raw materials for their own combined feed production Miratorg pays special attention to food safety issues, veterinary control and compliance with environmental requirements and requirements Each product has the required certification and/or compliance statement

Warehouse and distribution System: Miratorg has 14 major warehouse centers

throughout Russia, their warehouses offer control temperature choices from 10°C to 20°С featuring zoning options including: deepfreeze (18°С) and chilled produce (0 -5°С) Their class-A warehouses meet the highest logistic standards, offering optimum conditions for the storage and handling of any kinds of shipments They have over 1500 modern means of transportation are guaranteed temperatures from -22°C to 0°C and all of their vehicles are equipped with GPS monitoring systems and for monitoring the temperature in the goods compartment The brand is not only famous for its quality products but also the mode for customers attractive including consulting to provide processing information, fast delivery to domestic customers and

in the CIS area

Business partners:

- Domestic: As a manufacturer and supplier of pork, the largest meat-using material in Russia for food giants, HoReCa-style corporations Supplier to the channel system of more than 40,000 retail locations throughout Russia

- International: Miratorg's main pork export markets are Hong Kong, Vietnam, and CIS countries Potential markets that businesses target are Asian countries including China, Japan and South Korea Miratorg's representative expects this year, the group will export more than 50,000 tons of pork to Vietnam and this number will increase every year Up to now, the group has exported 3,300 tons to Vietnam, including the latest batch of 200 tons on March 7, 2020

 Comment

Product quality is a remarkable point of Miratorg, each production stage is strictly managed by modern technology and professional staff

The output of pork production is always guaranteed to meet the needs of domestic market and foreign partners with the best quality

The price of meat imported from Russia to Vietnam: about 2.55 USD / kg, equivalent

to an average of 60,000 VND/kg

b Rusagro corporation

 Characteristics

Rusagro Group’s Meat Business Division is one of the fastest growing in the Group, and the third biggest pork producer in Russia with a market share of 5.4 % It is represented in the Russian market by Tambov Bacon LLC, boasting manufacturing facilities in Tambov and Belgorod regions, as well as Rusagro-Primorye LLC in Primorsky Krai

Manufacture system: The Company’s pig farms operate in compliance with world

standards and use advanced pig production and feeding technologies The production facilities of the Meat Business Division represent modern and ecologically safe commercial farms with a high level of automation All the division’s activities are carried out in compliance with the principles of environmental protection

Product quality: High-quality products, the best customer service, responsiveness,

reliability and skillful management – all these features characterise the division in the Russian and international markets…

The company products include:

 Chilled pork half carcasses: large cuts include chilled and frozen

 Bulk products: by products include jaored byproducts, red byproducts, white byproducts

 Chilled case ready products: large cut, small cut, portioned meat, minced meat, shashlyk and marinated products

 Rendering plant products: meat and bone meal, inedible fat

-Comment:

Rusagro offers a variety of pork products and quality standards to the domestic market

in Vietnam, creating conditions for stability and development Rusagro's pork has to

go through strict and leveling processes before reaching consumers The output of pork is always guaranteed to supply to domestic and foreign partners

- Characteristics

OSJC "Cherkizovo" Group is a Russian food company that is a major producer and processor of poultry and pork

Cherkizovo Group is one of Russia’s top three industrial pork producers The Company’s farms have a total big population of approximately one million heads

The Cherkizovo Group is the largest producer of meat products in Russia, focusing on consumers The group ranks first in cumulative meat processing and poultry production, and second in pork production

Products: The list of exported products includes chicken, turkey, pork and processed meat mainly produced in Moscow, Lipetsk, Kursk and Penza areas

Cherkizovo's pork production capacity: 14 modern pig farms with a total capacity of

180 thousand tons of live weight per year, 6 meat processing plants with total capacity

of 190 thousand tons per year

Technology: Cherkizovo facilities comply with current international trade requirements and are certified according to FSSC (Food Safety System Certification) and ISO 9001 standards, animals raised under conditions It is almost safe, stress-free with the use of balanced feed grains, pure water and implements strict quality control

at all stages of production

Manufacture system

Control of the entire production - development and production cycle to deliver the final product

Professional and responsible approach at each stage of the value chain Cherkizovo has its own well-developed raw material base, a land bank, production facilities in various regions and a team of real experts

Product quality

Cherkizovo develops new product lines, including healthy food options, and continues

to expand Cherkizovo's product range to meet the growing demand for pork and poultry products cooked All products have excellent taste, structural properties and shelf life (up to 12 months without moisture loss) thanks to their own innovative raw material and manufacturing technology Cherkizovo freeze products to minimize shrinkage, tight control of components and save labor

Business partner

+ Domestic:

Closely monitoring product quality throughout the manufacturing process, Cherkizovo

is committed to meeting the highest safety standards and the most stringent customer requirements, including from fast food chains and home chains Offering great pizzas for catering companies and featured restaurants Cherkizovo's state-of-the-art production facilities operate in environmentally friendly areas and state-of-the-art logistics capacity enables quick delivery to customers

+ Internation

Exporting of meat products, including poultry and pork, is a major driver of agricultural and food industry development Cherkizovo focuses on expanding its footprint in CIS, the Middle East, Africa and Southeast Asia and cooperating with relevant Russian government departments and agencies to promote products on export markets

- Comment:

Cherkizovo mainly exports chicken meat to Hong Kong and Vietnam countries Pork export is still very limited The product quality is strictly controlled to meet the standards for export to foreign markets

Conclusion: Miratorg is the most potential supplier

Chapter III Plan reach an agreement

III.1 Inquiry:

III.1.1 Product name: Frozen pork

III.1.2 Specifications and qualities:

The frozen material must be fresh meat, in accordance with TCVN 7046: 2009

Sensory criteria

Indicator request

Freezing state

state

- The meat block is hard, cold, sticky, dry and knocking surface with resonance, allowing little snow on the outer surface of the meat;

- Clean meat, no strange impurities, no ice on the surface, not thawed Color Characteristics of the product

After freezing state

state

- Elastic, the surface is not viscous, does not stick to foreign impurities

- Grease soft, tough, shaped Color Characteristics of the product

smell Characteristics of the product, no strange smell

After boiling

smell Aromatic, characteristic of the product, no strange smell

taste Sweet, characteristic of the product, no strange taste

Meat broth Clear, large fat scum, when reacting with copper sulfate (CuSO4) allowsslightly turbidity