Wednesday, 25 November 2015

Russian agri-business news and comment

Moscow Region has been announced as the leader in agriculture this year, outperforming all other regions 2015 harvest by 0.8mt/ha.

Possibly as it’s closest to Moscow (and investors) and gets a bit more attention; like the way fields nearest the home farm always seem to yield the best.

Stavropol administration report they will transfer ownership of seven areas of federal agricultural land totalling 130,000ha.  

It’s not entirely clear who the land will pass to as the head of the Federal Agency for State Property Management, Olga Dergunova, said they still need to work out the mechanism of transmission and determining ultimate ownership, be that Stavropol region or municipality.

One thing Dergunova did say was that “our position of principle is to keep (the land) in public ownership” and “the privatization of this land is unacceptable” which all sounds a bit like a football team board giving their full and unquestionable support of their manager right before they sack him.

(Anyone taking bets on how long Rafa Benitez has left at Real Madrid?)

According to Ministry of Agriculture market data, poultry production in Astrakhan has increased by almost 10 fold and farmers continue to work on replacing imported products.  

The increase is driven by investment in JSC Astrakhan Product (Астраханский продукт) who commissioned a new automated cell broiler plant which they report will allow 700mt/yr of poultry meat to be produced with a long term view of expanding to 10,000mt/yr.

Earlier this week Russia’s Minister of Agriculture, Alexander Tkachev, held a working meeting with Governor of the Novgorod on the development of agriculture in the region.

The Minister touched on a number of points during the meeting but the main issues was to accelerate the substitution of imports by encouraging investment in to priority points of growth.

So no sign that Russia’s food sanctions will be ending anytime soon but with the Ministry releasing the latest year to date output figures for livestock and poultry up only 4.8% on the same period last year, it looks like the Minister still has his work cut.

The Min of Ag report sugar beet harvest to be 98% complete with 37.6mmt (factory weight) of sugar beet lifted yielding 38.0mt/ha compared to 33.1mmt and 37.0mt/ha in 2014. 

I can’t find any information on the current sugar percentage but I believe it is generally higher than the 16% we see in western Europe.

Russian Min of Ag announced they will allocate 25 billion rubles (£252m) to support the dairy sector in 2016.

This year, Russian self-sufficiency in milk production reached 81% although according to the Ministry, Russian's consume a quarter less milk products than the recommended standards.

I find that hard to believe based how Smetana turns up at every meal of every day in Russia (see picture).