Volga Baikal AGRO NEWS Update on the Export Situation in Russia !!!

The Ministry of Agriculture has developed a new project passport, according to which the target of $ 45 billion has been postponed to 2030. In the previous document, this figure was provided for 2024.

“The previous benchmark was too ambitious to me,” – says Dmitry Rylko, Director General of the Institute of the Agricultural Market Studies (IKAR ).

In addition, he added, the situation has changed a lot lately. “COVID-19 leads to a reduction in the volume of world trade in general and food in particular, to a fall in GDP, a decrease in effective demand,” – he said. “There is also a clear tendency with an increase in the isolation of markets, a decrease in the growth rate of world trade, which impacts the Russian market as well.”

“The pandemic has led to the creation of a new, yet difficult to predict , reality, which requires adjustments to long-term plans and forecasts. Therefore, making changes to the project is justified,” – said Alexander Korbut, Vice President of the Russian Grain Union.

According to him, the new forecast is realistic. “The task that can be solved is also realistic, although for this it will also have to take additional measures on the part of the state,” he said.

The measures that are currently being taken to develop the export of agricultural products are moving in the right direction, he said. “It’s another matter that many of them take quite a long time. They cannot be implemented all at once,” Korbut said. “But these indicators provide a very realistic program for market development. And this is a good for business.”

According to Eduard Zernin, chairman of the board of the Union of Grain Exporters, adjusting the project passport is a necessary, it’s a correct measure.

“The world food market is overheated, we can clearly see this from the price and volume records of our grain exports,” he said. “This is primarily due to the formation of excess food reserves by a number of countries, primarily China, amid fears about the development of the coronavirus pandemic in the world. Their purchases are the main driver of world prices upward. ”

However, Zernin noted, in the foreseeable future, as the situation normalizes, the created reserves will inevitably fall on the domestic market of these countries. “As a result, we may face a sharp drop in demand for a number of our agricultural products”, – he said.

According to Albert Davleev, President of Agrifood Strategies, adjustments to the project both in financial terms and in terms of government support for exports “are quite adequate and take into account the realities and dynamics of the world food markets, coupled with the current state and capabilities of the Russian agro-industrial complex.”

“First of all, this concerns the target indicators for the value of exports, since the almost 30% depreciation of the ruble over the past year and a half has significantly reduced the possibility of” converting “domestic prices for agricultural products into world ones, – he said. – Given the volatility of world financial markets Due to the ongoing pandemic and other factors, fixing export indicators in prices and tonnage of the current period also seems to be justified from a methodological point of view. ”

According to him, in recent years, many analysts and practitioners of the Russian agro-industrial complex were very skeptical about the reality of achieving exports of $ 45 billion in 2024. “In business, this approach is often quite justified, since it allows mobilizing resources to raise indicators, even if it does not reach In the case of state policy, approaches and goals should be more balanced and realistic, because we are talking about the use and “arrival” of state budget funds, that is, taxpayers’ money, “Davleev said.” That is why it is very important to take into account the opinion not only government officials, but also the manufacturers themselves and the expert communities. “

“As for the specified and expanded measures of the state support, it is obvious that the mechanisms of the “green” and “yellow” boxes provided for by Russia’s membership in the WTO are used. In fact, their reserves are far from being exhausted,” – the expert said.

According to the Ministry of Agriculture, as of November 08, the Russian exports of the agricultural products amounted to $ 23.6 billion, which is 15% more than the same date of the last year (data for the EAEU countries as of September 01, 2020).

Source: IKAR