Tech Food EU-ASIA
Tech Food EU-ASIA
Tech Food EU-ASIA

ASIA INVEST PROGRAMME 2006-2007

Due to reforms to establish a market-oriented economy, Mongolia enjoys a degree of economic openness that sets the country apart from its Central Asian neighbors and from many other developing and transitional countries. More than 80% of the economy is now in private hands, up from almost zero in 1990. Mongolia’s food processing industry is comprised of meat processing, meat products, milk and dairy processing, flour and flour product manufacture, production of alcoholic and non-alcoholic beverages. Presently, there are over 1800 small and medium sized business entities working in the food industry and up to 14% of total industrial workers are engaged in this sector.

Variety of factors position the Mongolian agro-food sector as a good investment opportunity. The agricultural and food processing industries have great market and sales potential in Mongolia and abroad due to the promotion of bio and eco products exports, and have successfully attracted foreign investors for the last decade. Mongolia has a relatively pristine nature that sets it well conditioned to produce and export bio and ecologically clean raw materials and foodstuffs. The Mongolian National Chamber of Commerce and Industry (MNCCI) in order to support exports of bio and eco products has initiated “One Aimag – One Organic Product” movement, and it has selected “smoked fish” from Selenge aimag, “Watermelon” from Hovd aimag, “Red skinned garlic” from Zavkhan aimag, “Plantain extract with honey” from Selenge aimag, “Hippophae oil” from Uvs aimag, “Fluffy white aaruul [dried curd]” from Arkhangai aimag, “Delicious airag [fermented mare’s milk]” from Bulgan aimag, “Sugar grass” extract from Bayankhongor aimag, “Camel’s hoormog [camel milk clabber]” from Umnugobi aimag, and “Green tea” from Huvsgul aimag to compete in the selection of the “99 Best National Products of Mongolia”. However, there is unquestionable need of further investment, to better spread the employ of new technologies and make it a common practice. Besides new technologies that improve the quality and quantity of the output, there’s considerable need of new technology that guarantee safer standards of production.

Meat and meat products manufacturing has an important place in the food sector and is considered to be the most potential sector for future development. There are over 70 SMEs that produce meat products for domestic consumption. Mongolian meat and animal by-products such as sausage casings and blood and bone meal have potentially large markets in Central Asia, the Middle-East, Europe, Japan, and China. Exports could be increased with the introduction of better packaging, as well as chilling and refrigeration facilities.

The average milk and dairy product consumption per capita increased constantly during the last 10 years reaching 126kg in 2002. Currently, many small and medium factories and business entities manufacturing milk products are established, providing solid basis for the further development of the dairy industry. In 2006, the total output of processed milk was 5 times more than 2000. There are about 88 small and medium sized dairy plants, with a total daily capacity of about 50 tonnes of fresh milk, producing butter, cheese and other dairy products. Local dairy production has not been able to meet the population’s needs fully. The amount of imported milk products is increasing, pointing to high investment opportunities in this sector. Recently, a local company and a joint venture group introduced tetra-pack technology and are now producing milk and fruit juice using UHT technology. The introduction of this new processing technology constitutes a remarkable improvement within the food industry, confirming that Mongolia needs support and further investment in this sector, in order to better meet the real needs of the population as well as reach international standards of production.

Agro-processing industries have great potential in Mongolia due to the rich availability of high quality raw materials. There are more than 80 semi-processing and final processing firms in Mongolia. These companies are mostly medium size companies with foreign ownership (77 out of 80 companies are joint ventures) engaged in primary processing and the production of finished items.

 

Project Leader:

Informest
Italy
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