Profits are in the $80 per head range and big companies are making plans for expansion.
Russian pig prices are now almost double compared to those offered in markets such as Canada, the US or Brazil. Without almost any pork imports, the industry is thriving in the domestic market, prices reaching 123 rubles ($1.82)/kilogram live-weight.
At this time, Russia has 1.8 million sows but the industry is expanding, big companies planning to add between 250,000-300,000 sows in the next 4 years, according to a global report issued by Genesus.
"Most if not all the major Russian companies are expanding or have expansion plans. If expansion leads to exports and that pushes prices lower several marginal high-cost operations would not survive, old facilities, terrible health and low productivity would be there death knells", declared Jim Long, President-CEO of Genesus.
Nevertheless, African Swine Fever is one of the biggest hurdles for the Russian pork industry. "ASF other major effect is the damper it has had on investment. Banks wary of financing smaller operations due to it. Large companies with multiple sow units can withstand losing all the pigs on one farm. Since ASF has hit most if not all, new projects have gone away from multiple site production in favor of usually 3000 sows on one site farrow to finish. The belief is biosecurity can be done easier and if you use a site. You clean up and refill', added Mr Long.