Friday, 9 December 2016

This weeks Russian Agri-business news

Russia continue to report bullish agricultural production, this time greenhouse vegetable crops up 33% more when compared to the same date last year.

While Russia’s poultry industry seems to have reached domestic demand saturation as the industry reports growth stopped in Q3 after ten years of a steady 13% increase in output.

So it comes as no surprise to hear that the Russian poultry and meat producer, Cherkizovo, has negotiated and been granted authority to export chicken meat to the EU.

As of 1st November, Russian grain stocks stood at 47.7mmt, the third month in a row of highest grain stocks (y-o-y) in the last five years.

Russia's record stocks are due in part to a record crop and slower than expected pace of exports with Andrey Sizov from SovEcon telling me via twitter that, in his opinion, the main reason is a dramatic improvement in farmers finances, presumably allowing them to hold on to stocks and sell strategically.

African Swine Fever (ASF) in southern Russia had the grain trade holding its breath this week with reports of possible quarantine measures affecting grain transport and exports.  

The issues seems to have passed for now with Krasnodar Governor Mr Korobkagive saying earlier today that there are no grounds to impose quarantine on grain shipments and that the situation is stable.

Good news for now but given the highly contagious nature of ASF, no treatments or vaccines and high mortality rates, I suspect this won’t be the end of the story.

Louis Dreyfus are to begin operations at the Don River grain terminal in Azov, Rostov region, with a facility that has the capacity to store 50,000mt and can handle ships up to 5,000mt.

Russia continue to keep up pressure to increase agricultural production with the latest draft resolution on idle or inappropriate land use aimed at bringing more agricultural land back into production.

Finally, Russia’s phytosanitary watchdog confiscated five tons of fruits, veg and nuts in November from the hand luggage of arriving passengers. Five tons!

Have a good weekend.