World meat industry news

There are more than enough of their own products in the country, and with the departure of certain foreign manufacturers, new prospects are opening up for Russian companies. This is the reason why there are no plans to allow parallel food imports. But Russia will not cancel quotas and export duties either: we are ready to fulfill our obligations to foreign partners, but the domestic market is an unconditional priority. This was stated by the Minister of Agriculture Dmitry Patrushev at the All-Russian Field Day 2022 exhibition taking place in the Kaliningrad region. Details - in the material "Izvestia".

All current restrictive measures regarding food exports will continue to be in effect, the minister said during a speech at the All-Russian Field Day 2022 exhibition. According to him, quotas and duties have proved their effectiveness. They made it possible to eliminate the shortage of socially significant products and prevent sharp price fluctuations. At the same time, if necessary, the Ministry of Agriculture is ready to adjust the regulation. Thus, the transfer of the duty calculation from dollars to rubles made it possible to reduce its size by almost 40%. According to Patrushev, now this mechanism is optimally tuned and allows farmers to maintain sufficient profitability of production.

At the same time, the head of the Ministry of Agriculture noted that Russia plays a crucial role in ensuring global food security, is ready to fully use its export potential and supply quality products to the world market. Since the beginning of the year, exports have grown by 20%. The shipments of oil and fat, meat and dairy products, fish and seafood have noticeably increased. Demand has increased in almost all areas.

“Of course, the sanctions have complicated export activities. Nevertheless, we find opportunities to provide our foreign partners. Of course, we are not doing this to the detriment of the stability of the domestic market,” Patrushev stressed.

Eduard Zernin, Chairman of the Board of the Union of Grain Exporters, notes that in the 2021/22 agricultural season, Russia retained its leadership in wheat exports with a volume of 30.7 million tons. In the new agricultural year, this leadership will be maintained thanks to one of the best harvests in the country's history. Now the grain yield is a quarter higher than last year. The head of the Ministry of Agriculture retained the previous estimate of the gross harvest at 130 million tons. Taking this into account, the export potential for the season could reach 50 million tons. Including wheat, according to Eduard Zernin, 40.3 million tons can be exported.

But the new season in Russia began against the backdrop of "unprecedented sanctions pressure" - hidden sanctions seriously complicate the task of exporting grain, the expert believes. Zernin calls the lack of a large-tonnage fleet, as well as the availability of trade finance tools, especially acute problems. In addition, business is hindered by an additional insurance premium introduced by foreign insurers to "discriminate and increase the price of Russian grain."

Nevertheless, exporters agree that it is impossible to cancel the export duty on grain - it "allows us to stabilize the domestic market in a comfortable price range." A stable market allows you to export the surplus.

As for the mechanism of parallel imports, Dmitry Patrushev recalled that this tool is needed in order to organize the supply of goods that have no replacement within the country. In the product segment, according to him, there are no such irreplaceable positions. We provide ourselves with the main products ourselves, and we import only what we cannot produce due to climatic conditions. Russian consumers now have a huge choice of products, including those from foreign companies that have localized their enterprises in Russia and continue to work here.

“Cases of foreign companies leaving, firstly, are isolated, and secondly, they open up new prospects for domestic brands that are definitely not inferior in anything. Our enterprises can quickly replace almost any foreign product, whether it be drinks, confectionery or other goods,” Dmitry Patrushev is sure.

As an example, he cited the experience of developing the industry since 2014, when the country imposed an embargo on food imports from a number of countries. At that time, domestic manufacturers were able to quickly occupy the vacated niches, increased production and offered high quality products to consumers.

"The spread of parallel imports for food does not primarily meet the interests of domestic business, which now receives good incentives for development," the minister said. In his opinion, the assortment of goods for consumers will not change and in some cases even expand.

The head of the National Meat Association, Sergei Yushin, draws attention to the fact that now wholesale pork prices in Russia are approximately at the level of 2015, while consumer prices have grown by an average of 10–13% over seven years. For chicken meat, the rise in prices is noticeably lower than food inflation, which amounted to about 50% over this period. This is the result of a long and hard work of business and the state to develop the meat industry.

Russia has enough own meat and many other foodstuffs. At the same time, there is no need to replace literally everything in a row - the economy of any more or less developed country is built into the international or regional division of labor, the expert notes. According to him, now the supply of many necessary components, raw materials for food production has not been stopped. Cooperation continues with dozens of countries and thousands of companies on all continents.

- Of course, there are difficulties with the supply of certain types of equipment, spare parts, parts, complex devices, assemblies and control units, some individual specialists do not want to go to service the equipment. But all this is usually the decisions of private companies and individuals that they take for various reasons. Although high-tech equipment is known to be subject to severe restrictions and prohibitions. And yet, agriculture, food and everything connected with them did not fall and, I very much hope, will not fall under direct sanctions. First of all, because tens of millions of people in different countries will suffer from this, including those that will introduce such sanctions,” says Sergei Yushin.

There is no point in parallel importing products, since there is no such item that we do not produce or that cannot be replaced, agrees Dmitry Vostrikov, executive director of the Rusprodsoyuz Association of Producers and Suppliers of Food Products. Cheese, milk, meat, cereals and much more. And the raw materials that we import - cocoa beans or tropical fruits - we import mainly from friendly countries.

Those who say they are leaving the Russian market are opening up niches for domestic producers. For example, our companies are already actively producing their own carbonated soft drinks, similar to the products of American companies, Vostrikov draws attention. So it was after 2014: all the hype around “cheese and jamon” simply suggested to our business the production of which products should be established. At the same time, according to the expert, the need for parallel imports remains in relation to equipment for the production of food products and spare parts for it.