Iran wants to take over European market shareMedvedev announces new investment of billions
Russian prime minister Medvedev announced in an interview last week that he wants to invest “dozens of extra billions of roubles” in the agricultural sector. With the investment, Russia wants to further develop domestic production and sales. Iran wants to substantially increase export of fruit and vegetables, and has the ambitious plan of taking over the European share in the Russian market. After discoveries in Russia, in Belarus a batch of illegal fresh produce has been confiscated as well. The origin of the products couldn’t be identified. American nut growers lose a market due to the ban, but are now focusing on Asia.
A new front appears to have opened in the conflict between the West and Russia. On the border between Estonia and Russia, an agent of the Estonian intelligence service was arrested. The man was supposed to have an appointment with an informant, but was taken away by armed men. Estonian security wasn’t able to intervene. The Estonian intelligence officer is being held in Moscow, awaiting the official charge. That is expected to be: espionage.
EU postpones sanctions
The EU has postponed sanctions that were supposed to be put into action yesterday. At the last moment, it turned out there wasn’t unanimous agreement on the additional sanctions. Finland objected in particular, but also Eastern European countries that are being hit hard by the economic war, were doubtful. The additional measures have been postponed for a few days, the Union wants to keep an eye on the situation in Eastern Ukraine over the following days. If the ceasefire holds, the EU can put the sanctions on hold longer.
Belarus: Smuggled fruit confiscated
In a shopping mall in Minsk, police have confiscated more than four tonnes of smuggled fruit and vegetables. The total worth is more than 2 million euros.
The smuggled products were discovered during inspections. The Azerbaijan traders were able to provide documentary evidence for the purchase, storage and transport of a lot of fruit and vegetables. The illegal goods were confiscated. The research data has been given to the tax service.
Californian nut growers look to Asia
Nut growers in California were hit by the Russian import ban. One grower told the American show CCTV America that his load of pistachios was already on its way to Russia when the ban was put into action. He was able to export the nuts, at a loss, to Germany, but did lose a big Russian client because of the ban. The nut growers aren’t really worrying, Asia is one of the markets where demand is growing.
Moscow opens new logistics centre
A new agrocluster, FoodCity, in Moscow, is supposed to increase the supply of fruit and vegetables in Moscow and the surrounding areas. The centre was recently opened by the city’s mayor. To properly supply the region, three or four more of such centres will have to be built. The FoodCity has an area of 84.5 hectares. The wholesale market takes up 246,000 square metres, and the centre also has office space, storage facilities, parking space, and a hotel.
The city’s mayor also announced that three large investors are willing to support the building project of three greenhouse centres. The cost of this project is estimated to be 200 million dollars. The Russian investors are working together with Dutch, Israeli and German companies. The centre is being built near Moscow.
Iran wants to take over EU market share
The Iranian Trade Promotion Organization has announced that the country wants to replace Europe in the Russian food market. Export of vegetables, fruit, fish and poultry should grow in the near future. Several provinces in Iran are willing to visit the World Food Expo in Russia, in order to make contacts with Russian trade. In addition, a trade mission will travel to Russia. Iran is able to supply citrus, kiwifruit, pomegranates and grapes, among others, according to the Iranian organization.
Medvedev announces billions in investments
In an interview with Russian media, prime minister Medvedev has announced an investment of billions in the agricultural sector. “We will definitely make available extra funds to the sector. I am not going to give exact amounts, but we’re talking about dozens of billions of roubles,” the Russian prime minister said. Medvedev’s ambition is clear: “We have to feed ourselves and others. Why do we constantly have to eat foreign fruit?” Apart from investments in cultivation, part of the money will have to be spent on better organization of retailers and suppliers. The retailers have to opt more for Russian produce. The current budget for development of the agro-industrial sector for 2013-2020 is 200 billion roubles (5.4 billion dollars) a year. The investment Medvedev has announced, aren’t included in that yet.
Russians eat less fruit and vegetables
Statistics in August 2014 and August 2013 show that inhabitants of Novosibirsk, in the middle of Russia, are consuming less fruit and vegetables. Consumption of bread, pasta and meat, among others, increased. The average amount consumers spent on food in the region, based on Russian averages, was 3341.74 roubles (67 euros) in August. Compared to the previous month, that was 3.4% cheaper, but compared to December 2013, expenses increased by 7.9%. Fruit and vegetables make up about 18.7% of the food purchases.
European pears make 70% less
Pear prices are under pressure due to the Russian ban. Prices are reportedly up to 70% lower than last year. Russia was the largest buyer of European pears: over 50% of exports went to Russia. The hard facts: in 2013, the EU exported 313.2 million euros’ worth, Russia taking up 179.3 million euros of the export. The most important pear export countries are Belgium, the Netherlands and Lithuania.
Pear growers in Great Britain are also suffering the consequences of the ban. Although the country doesn’t export the pears, prices are reportedly under pressure. The British pear harvest will amount to 20,000 tonnes this year, while demand is estimated to be 150,000 tonnes. The differences is made up for by import.
On the apple market, the British are suffering less from the ban, a representative of English Apples & Pears expects. The British reportedly prefer the smaller, domestic varieties.
Chechnya supplies fruit
In Chechnya, a good apple and pear harvest is expected. Growers are looking for new markets, and they look to the Russian market in particular. The export from the former Soviet republic is expected to increase.
The country has five large agricultural companies, but these companies have big expectations. The harvest has to be stored in order to be able to supply year-round, and investments in the agricultural sector are being encouraged by the government.
Publication date: 9/9/2014
Author: Rudolf Mulderij