Friday, 6 February 2015

Friday’s agri-business news round-up (or should that be glyphosate?)

The Russian trade ban dominated discussions in the EU this week with the commission urging
member states to show “solidarity” and to refrain from arranging their own talks in order to get around their ban for their own products.

The EU Agricultural Commissioner Phil "the Hulk" Hogan admitted that EU law did not prevent member states from establishing bilateral trade agreements but that a common EU approach would be more beneficial than one-off deals.

Which depends on where you are in the supply chain Phil; I just don’t see a Hungarian dairy farmer giving a toss about macro politics nor the marginal MP trying to secure the rural vote ahead of a general election.

The FAO have opened an office in Moscow to bolster cooperation with Russia in agricultural and food security-related matters.

I'm only surprised by this because I assumed they would already have an office in Russia although the inauguration of the new office is scheduled for the end of the year so don’t expect too much too soon.

Seven out of nine Belarusian meat processing companies have resumed supplies of beef to Russia previously banned over African swine fever virus.

Showing my ignorance here but can cows contract swine fever?

According to the office of a German parliament member the armed conflict in Ukraine is being used as a smokescreen for the seizure of farmland by foreign firms funded by the World Bank and EBRD.  The other story doing the rounds is that Ukraine will be forced to grow genetically modified crops in return for foreign aid hand-outs.

Personally I don’t buy either of these rumours for a number of reasons including anyone can secure land in Ukraine, you don’t need a war to hide behind and growing GM is one thing but who will buy it?  Having said that these rumours have been around since last year and they do keep cropping up so something’s afoot.

Kazakhstan now and according to the analytical service, the volume of agricultural investments in the country is up 17% on 2013.

It may be that while Ukraine is on temporary hold as an agri-investment destination then Kazakhstan reaps the benefit, plenty of potential out there...if it rains.

Still in Kazakhstan and the Minister of Agriculture has proposed dropping grain export subsidies ($81 million) in favour of spending on supporting farmers, developing seed production and purchasing equipment.  Seems sensible.

In the same week Kazakhstan proposes dropping export subsidies, Russia imposed their export tax priced at no less than €35/mt and current rumours are the Ministry is considering increasing the rate and extending the term which has not gone down well at all.

Unlike vodka which has seen the price slashed in Russia.

My topical advice this week then is don’t booze if you are considering signing an extension to a trade tariff, you might do something rash.

Have a good weekend.