Hyundai Heavy secures farms in Russia
Bloomberg | April 15, 2009
Hyundai Heavy Industries Co., the world’s largest shipbuilder, bought 67.6 percent of a Russian farm to grow corn and soybeans, heeding a call by the Korean government to help ensure food security.
The shipbuilder purchased the stake from a group of New Zealand investors for $6.5 million and plans to produce 60,000 metric tons of corn and soybeans in 2014, the Ulsan, South Korea-based company said in an e-mailed statement yesterday.
Hyundai Heavy has ventured into solar and wind power to reduce its reliance on shipbuilding, which accounted for almost half its sales. Korea, Asia’s second-biggest grain importer, wants its companies to develop farms overseas to ensure food security after record grain costs sparked riots in Egypt and food shortages in Argentina last year. The shipbuilder is considering more acquisitions and is reviewing sites, including those in Russia, the company said.
Hyundai Heavy will invest $9 million to increase the farming area to 50,000 hectares (123,553 acres) from 10,000 hectares by 2012, and the crops will be sold to South Korea, it said. The farm is located in Khorolsky Rion, about 170 kilometers (106 miles) north of Vladivostok.
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