Tyson Foods Inc. is holding discussions to construct a beef processing plant in Kazakhstan in a bid to avoid China's steep tariffs on U.S. agricultural goods, the Financial Times (London) reported May 23, citing people familiar with the matter.
According to the newspaper, the Arkansas-based meat processor discussed an initial investment of about $200 million in the factory, which could boost beef production by up to 5 million tonnes annually. It would form a fraction of a potential total investment that could reach several billion dollars, the report said.
Tyson spokeswoman Liz Croston confirmed interest in Kazakhstan but said nothing has been finalized yet, according to FT. "We have visited Kazakhstan and have interest in the nation's future food production efforts. However, we have not formalized plans for a project there," said Croston.
Beef exports from the U.S. fetch a total levy of 37% in China, while Chinese tariffs on Kazakh meat are at 12%.
Tyson is on a buying spree, agreeing to acquire Thai and European operations of Brazil's BRF SA for $340 million in February and completing its acquisition of Marfrig Global Foods SA's Keystone Foods LLC for $2.16 billion in November 2018.