Russian agroindustry is fighting off global storms

Published 2021년 11월 22일

Tridge summary

The global pandemic and economic surplus have led to a significant increase in agricultural product prices, marking the second year of historical highs. Despite these increased costs, the Russian agricultural sector has seen growth, with a 5.7% increase in agricultural production and the second largest grain harvest. However, domestic producers have had to contend with rising costs and the government has imposed export duties on wheat and oil to protect domestic prices. Dairy producers, aided by exports, are the only food producers that have not seen a drop in consumption. The Russian government is supporting dairy exports by covering a quarter of the transportation costs and up to 90% of certification costs in foreign markets. Despite these efforts, some dairy producers are leaving the market, leading to concerns about a raw milk deficit.

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Original content

The ongoing pandemic and the surplus of money in the world economy have led to a sharp increase in prices for almost everything, and especially for agricultural products. World prices for grain, meat and fish have been renewing their historical highs for the second year already. The Russian agroindustry used this to its fullest: the index of agricultural production in the agro-industrial complex, according to the Ministry of Agriculture, amounted to 5.7% last year. Russian farmers produced the second largest grain harvest and increased supplies abroad; the growth rates of production and exports from Russian pig breeders and oil producers doubled. The profitability of the organized agricultural sector, according to the Rosselkhozbank, increased by 86% last year, and this year it is expected to increase by at least 55%. At the same time, markets had to adjust to global price storms. To protect domestic prices, the Russian government introduced duties on the export of wheat and oil ...

Source: Oilworld