Financial backing rises in processed meat segment

Financial backing rises in processed meat segment

Both foreign and domestic investors are striving to set a solid footprint on the billion-dollar processed meat segment in Vietnam.

Brazilian meatpacker JBS in late March announced a $100 million investment plan for the construction of two factories in Vietnam, a move aimed not only at expanding its presence in the region but also at strengthening its position in the global market.

The plants will be responsible for producing beef, pork, and poultry and will primarily use raw materials imported from Brazil to supply the Vietnamese market and other Southeast Asian countries.

Renato Costa, president of Friboi, a JBS subsidiary, said, “This investment reflects JBS’s commitment to sustainable and strategic growth in Southeast Asia. The new factories in Vietnam will not just expand our production capacity but represent an investment with a purpose to create value for the local economy, generate skilled jobs, and contribute to food security across Southeast Asia.”

The plan outlines that the first phase of the project will be established in Nam Dinh Vu Industrial Park in Haiphong, where a logistics centre will be built with storage capacity, including pre-processing, cutting, and packaging operations. The second phase, to be located in southern Vietnam, is expected to begin two years after the first unit starts operations and will feature similar infrastructure, including a new logistics centre and processing plant.

Also in March, Japan-Vietnam Livestock (JVL), a joint venture between Vinamilk’s subsidiary, the Vietnam Livestock Corporation, and Japan’s Sojitz Group, opened a cattle farm, establishing a fully integrated supply chain from breeding and raising cattle to processing and distributing beef.

JVL said it will soon launch a premium chilled beef brand, offering a diverse range of high-quality, value-added beef products designed to meet evolving consumer tastes. In addition to its core chilled beef offerings, JVL has introduced processed items such as sausages, beef balls, and marinated beef cuts.

“Our chilled beef products have begun to gain significant recognition in the market,” said YoichiHarumoto, JVL’s CEO. “We’ve become a trusted supplier to restaurants and major supermarket chains such as WinMart, FujiMart, and AEON. With the entire complex coming online, we expect to expand our market reach significantly.”

Established in 2021, JVL is also aggressively tapping into the growing meat market. By the end of 2024, the company commenced operations at its Tam Dao beef processing complex in Vinh Phuc province. The facility spans 75.6 hectares and includes a cattle farm capable of housing up to 10,000 cows, and a beef processing plant with an annual capacity of 30,000 cattle, producing approximately 10,000 tonnes of beef per year.

Meat production in Vietnam has been steadily increasing each year. According to a report published by Japanese market research company B&company in January, the processed meat segment has shown continuous growth, rising from 135 million kilogrammes in 2019 and reaching 146 million kilogrammes in 2024.

“The revenue from processed meat products has steadily increased over time, growing from $900 million in 2019 to $1.2 billion in 2024, and it is estimated to be $1.6 billion by 2028. This growth reflects the rising consumer demand for convenient meat products that cater to the fast-paced lifestyle of modern society,” the report noted.

According to a report by market research firm Statista, published in March, consumers in Vietnam are increasingly becoming health-conscious and are demanding healthier and more sustainable processed meat options. This has led to a rise in demand for plant-based and organic processed meat products. Additionally, with the growing trend of flexitarianism, consumers are looking for alternative protein sources, leading to the popularity of plant-based meat substitutes.

“In Vietnam, the processed meat market is seeing a surge in demand for healthier options, with consumers increasingly turning to plant-based and organic alternatives. This trend is driven by concerns over food safety and rising health consciousness,” the report noted.

The largest meat processing companies are Masan MEATLife Corporation, C.P. Vietnam, Daesang Duc Viet Food, Dabaco Group, and Vissan.

According to financial statements released by Masan Group, the parent company of Masan MEATLife (MML), the company recorded a 24 per cent on-year revenue increase in Q4 2024 and a 9.5 per cent growth for the full year. MML generated approximately $88.2 million in Q4 and $306 million in 2024 overall.

In the processed meat segment, core brands Heo Cao Boi and Ponnie surpassed the monthly revenue threshold of $8 million, accounting for 34.6 per cent of MML’s total annual revenue.

Nguyen Dang Quang, chairman of Masan Group, stated that both Masan MEATLife and WinCommerce turned a profit in 2024, contributing a combined $39.7 million to the group’s net earnings.

“One of our key initiatives in 2025 is to roll out Meat Corners at WinCommerce stores,” said Quang, “This aims to increase the share of processed meat revenue within the system from 16.6 per cent to 20 per cent in 2025, with a long-term goal of reaching 40 per cent,” said Dang Quang.

Masan forecasts MML will generate between $330 million and $350 million in revenue in 2025, representing up to 18 per cent on-year growth.

VIR