Egyptian Fruit & Veg Exports to Russia Increase by 28%

Minister of Industry and Trade Tarek Kabil said that the inter-trade between Egypt and Russia had witnessed a tangible improvement for the first time since 2014.

Egyptian exports to the country during the first half (H1) of 2017 amounted to about $360m compared to $286m, meaning that Egyptian exports to Russia jumped 26% after a decline ranging between 16 and 25% during the past two years.

Kabil attributed this significant improvement in the volume of exports to the intensive promotional efforts carried out by the ministry and its success in lifting the ban on agricultural exports and Egyptian potatoes, as well as solving all problems that Egyptian exporters faced.

A report was sent by the Russian trade office to Kabil, in which was outlined the indicators of the performance of foreign trade with Russia during the H1 2017. The report showed that Egyptian vegetables and fresh fruit exports witnessed a significant increase, reaching about $303.8m during H1 2017 compared to 236.2m during the same period in 2016—an increase of 28.6%.

Egyptian exports of agricultural crops also increased 28.8%. Fresh strawberries increased by 43.7%, fresh potatoes 159.5% and onions 29.8%.

www.freshplaza.com

Tomatoes in Game of Yes-No Between Russia and Turkey

Last week’s meeting between Russia and Turkey has yet to provide clarity about the tomato boycott, but the yes-no game isn’t over yet. In the run-up to the meeting, contradictory reports were heard. After last week’s meeting, only one thing became clear: nothing is clear yet, so borders will remain closed for now.

The choice of words of both parties after the negotiations illustrate the confusion. The Turkish Minister of Economic Affairs Nihat Zeybecki said in Turkish media that various agreements had been reached. For the remaining small problems he expects a solution before 20 October (when there’s a meeting in Kazan). “There are just one or two very small things regarding agrarian products. We agree on all major lines. I am certain all problems will be completely solved before 20 October.” Specifically about the tomato boycott the minister said: “In the near future we hope for a positive solution from the conversations with the Russians about lifting the sanctions.”

“Proposals for liberalisation of the tomato trade will be prepared separately within parameters between the Ministries of Agriculture,” according to the Russian Minister of Energy Alexander Novak in Russian media. When asked if the sanctions could be lifted by 20 October, he answered: “Yes, definitely. We have confidence that all will become clear before the meeting of the intergovernmental commission.”

A Russian analyst illustrates the different points of departure of the two countries for Turkish website Vestnik Kavkaza. “Our growers are unable to deliver tomatoes that can compete with the Turkish ones. It is obvious that Ankara is very interested in an end to the boycott, but our growers aren’t interested at all.” Earlier the Russian Ministry of Agriculture said he wants to protect the investments that have been made in the Russian cultivation of tomatoes.

www.freshplaza.com

Russian Consumers Paying a Pretty Penny for Apples

The World Apple and Pear Association (WAPA) has reported that domestic apple production in Russia for 2017 is expected to be down by 37%, after late frosts and heavy rains hit production. However, this will not be the only reason why apple sales could be down this year.

According to industry sources, ‘The combination of rising apple prices and falling Russian consumer incomes has been the biggest factor in the decline of both imports and apple sales in the Russian market, industry sources acknowledge.’

Since 2013 the price of apples per kilogramme is up by 30%, more than any other fruit or vegetable in the country.

Despite recent increases in production, Marek Marzec from Ewa-Bis, said that Russian apple production only fills around 20% of the demand.

“Russia has been trying to develop the domestic apple industry for the last 20 years, sure, they have made some progress, but no where what is needed to become self sufficient. The positive thing about Russia is that it is such a large country with many different regions, they should be able always have success despite what the weather might throw at them.” said Marek.

Igor Muhanin, President of the Association of Fruit and Berry Producers (ASPRUS), had initially said that apple imports in 2016 had reached 1.38 million tonnes, but later revised that amounts to 1.25 million tonnes, saying that smuggling continued to be an issue in Russia, which authorities there have found it difficult to keep up with.

“The Agriculture Ministry is providing a subsidy payment to apple growers for planting new orchards and equipping them for higher yields of Rb236,000  ($4,140) per hectare. The experts say this represents between 10% and 25% of the costs of planting and equipping new high-yield apple orchards.” said Muhanin.

Estimates have claimed that Russian apple consumption came to 2.5 million tonnes in 2016, about 100,000 tonnes (4%) more than 2015. By 2020 the forecast is for consumption of 3 million tonnes; this represents an annual rate of growth of 4%.

According to BusinesStat, “The rate of growth of both domestic production and imports will depend not on the recovery of Russian consumer incomes and demand, and not on the sanctions or the increase in investments for commercial domestic orchards.”

“This year, apple sales will grow by just 1.7%, roughly the same as government and expert forecasts for Russia’s GDP growth. As the resumption of growth in real incomes begins, apple sales will grow in the retail sector. In 2021 the sale of apples in Russia will amount to 2.08 million tonnes, which will exceed the 2016 level by 35.7%.”

www.freshplaza.com

How Sanctions Changed Russian Food Market for 3 Years

During the past three years, something Russians were used to doing in the 1990s has made a triumphant comeback: the habit of bringing food home from trips abroad. Shopping for food on vacation outside Russia has become a routine pastime for them since August 2014, when the Kremlin banned import of dairy, produce, fruit, meat, poultry, fish and seafood from the U.S., European Union and several other countries.

Authorities at the time maintained that the move would punish the West and boost the country’s agricultural sector, spurring it to thrive in the absence of competitors offering less-expensive products.

Three years later, officials insist it did. A closer look, however, presents a more uneven picture. Food production in Russia has increased, but so have prices. Higher prices have led to changed and lowered consumption, and in turn, reduced sales. Inflation has eaten into the promised government support to help food production. And, say consumers and people in the food industry, the overall quality of available food isn’t as high as it was prior to the food import ban.

The food embargo came at a bad time for Russia. Oil prices were at a record low, the ruble had plummeted and the country’s relationships with Western nations was worsening. The term “isolation” dominated the news here.

In an attempt at positive spin, the Kremlin announced that the food import embargo would boost “import substitution” and help Russians overcome what many politicians labeled their “addiction” to imported goods and become self-sustainable. Companies in the agricultural sector were promised financial and infrastructure support from the state. Many companies immediately jumped at the chance to conquer the market.

The agricultural sector has indeed increased production of some food items in the past three years, according to data provided by Rosstat, Russia’s state statistics service. Russian companies produced 17.5 percent more beef in 2016 than in 2014. Pork production increased 30.6 over the same period, poultry production 11.9 percent, frozen vegetables 31.6 percent, milk 5.8 percent and cheese 20.2 percent.

“The embargo was quite an incentive for us because it meant we’d be able to produce more,” says Andrei Danilenko, chairman of the Soyuzmoloko, Russia’a association of dairy producers. “Over these years, we filled the niche completely – together with Belarus that supplies the rest.”

Spokespeople at the Agriculture Ministry are even more positive. “For the first time in many years, Russian food items started to dominate on the shelves,” officials said in a written statement.

Food imports during the past three years dropped almost in half, the ministry said, from $43 billion to $25 billion, whereas overall Russian agricultural production has increased by 11 percent.

“Achievements of the agricultural sector in recent years allowed us to edge even closer to full self-sufficiency when it comes to food,” ministry spokespeople said.

However, there was a downside. Rising prices, spiked by the embargo and fueled by inflation, changed consumer behavior. People started buying less and sales started to drop.

“People in general are saving money on food, and we end up selling less,” says Pavel Grudinin, head of the Sovkhoz Imeni Lenina agricultural holding that produces vegetables, berries and fruit in the Moscow region.

With some products, consumers started choosing cheaper options, and that kind of behavior significantly affected the country’s fish market, says Timur Mitupov, head of the Fishery Information Agency.

“Russia used to import 600,000 tons of fish from countries under the embargo every year,” he says. “Then people saw that fish is disappearing from the shelves and becomes more expensive. So they started replacing fish with something more affordable – like chicken.”

Yearly consumption of fish dropped from 22 kilograms (48 pounds) per capita to 16-17 kilograms, Mitupov says.

Adding insult to injury, the promised state support turned out to be not much of a help, Grudinin says.

“Financial support from the government on paper increased this year, but if you convert it into hard currency, you’ll see that in reality it actually decreased, because hard currency is more expensive now.”

At the same time, he adds, various taxes and levies have increased during the past three years, and so have crediting rates: “So there is simply no money to invest into growing.”

For the restaurant industry, the food import ban is a double-edged sword. Many restaurants had based their cuisine on imported food items and shut down after the embargo, unable to adjust to the new reality quickly enough. Those that survived are experiencing a gastronomic renaissance, says Alexandra Sutormina, restaurant consultant and food critic for GQ Russia.

“Restaurateurs discovered Russian meat, Russian seafood, Russian vegetables. Russian food has become a thing,” she says. “They started experimenting with it, setting up their own small farms, selecting products more carefully.”

The quality of Russian food products, however, is far from the best, argues Victoria Lavrushkevich, manager of Saxon&Parole, an upscale restaurant in Moscow.

“We offer quality seafood and quality meat,” she says. “But Russian (food) products or products we now have to buy in other countries are worse in quality and the same in price compared to what we used to get from Western suppliers.”

Some food has turned out to be flat-out irreplaceable – like cheeses from Italy and France. It takes decades to produce a good mature cheese, notes Lavrushkevich.

Sutormina agrees: “Even though many small cheese farms appeared across Russia over these three years, wonderful cheeses from Europe is the one thing we all miss.”

The embargo has hurt the ordinary consumer in more basic ways, says Vasily Uzun, economy professor at the Russian Presidential Academy of National Economy and Public Administration.

“The embargo took the cheapest products off the shelves: Polish apples, American poultry and European cheeses. Products that replaced them turned out to be more expensive and of lower quality,” he says.

Pakistani Exports to Russia Increase by 10%

Pakistan’s exports to Russia increased by 10 percent in June, 2017 as compared to May 2017, which showed positive sign for enhancing the trade ties between the two countries.

Pakistan and Russia have agreed to sign Free Trade Agreement for increasing bilateral trade and improving long term economic ties, said senior official of Ministry of commerce here on Thursday.

“Russian President Vladimir Putin during his meeting with then Prime Minister Nawaz Sharif on the sidelines of Shanghai Cooperation Organization (SCO) offered the agreement, which Pakistan accepted,” he added.

He said the trade turnover between Russia and Pakistan has slightly increased and both of the countries have huge potential for economic cooperation in future, he said.

He said that Pakistan is exploring Russian markets to boost exports of food products to take advantage of the vacuum created after Moscow banned food imports from European countries.

The official said that Pakistani citrus, rice, potatoes and mangoes are making their way into the Russian market.

He said Pakistan had huge opportunity to export fresh meat and poultry, vegetables which include carrot, cabbage and beet-root, and fruits including dates, dry fruits, apple and plum in Russian market.

The government is committed to support Pakistani exporters for gaining facilities to increase excess and competitiveness in the Russian markets.

Both sides were also willing to sign Preferential Trade Agreement (PTA) before the FTA to get excess to Russian market for enhancing trade facilities to the exporters.

www.brecorder.com

Cheaper Fruit and Veg Leads to Lower Inflation in Russia

In July, inflation in Russia fell below the Central Bank’s target and amounted to 3.9 percent. This is evidenced by the data published on the website of the Federal State Statistics Service.

Such a sharp decline in inflation was not expected by any analysts, as noted by the “Parliamentary Newspaper.” According to the forecasts of 18 economists previously interviewed by Bloomberg, inflation had been expected to decrease from 4.4 percent in June to 4.3 percent in July.

The reduction of fruit and vegetable prices has apparently had a significant impact on the dynamics of food prices.

“Thus, white cabbage has become 34.5 percent cheaper, potato prices have fallen by 21.2 percent, and beets, tomatoes, cucumbers, bananas and lemons have recorded price drops of between 8.3 and 15.2 percent. At the same time, the prices for oranges and apples increased by 8 and 6.4 percent, respectively,” reported Rosstat.

www.freshplaza.com

Trump Approves New Russia Sanctions

President Donald Trump signed into a law a bill which imposes new sanctions on Russia for their alleged meddling in the 2016 election. The bill, which was signed in private at the White House, also imposes sanctions on Iran and North Korea.

Mr Trump accused Congress of overreach on the legislation, which “handcuffs” him from easing Russia penalties.

Moscow said the sanctions “put paid to hopes that our relations with the new American administration” would improve. Russian Prime Minister Dmitry Medvedev also said this move meant the US had declared a “full-scale trade war” on Russia. The Kremlin denied interfering in the US election, and Mr Trump rejected any allegations that his campaign staff colluded with Russia to help him win.

Hours after the US president signed the bill, Kremlin spokesman Dmitry Peskov said: “This isn’t news. The thing is, the bill was approved and was going to automatically become law with or without the president’s signature.”

Moscow had already retaliated last week to Congress passing the bill, by expelling 755 people from its US embassy and consulates.

Several European nations, including Germany, are fearful of the economic consequences and European Commission President Jean-Claude Juncker has warned of “unintended unilateral effects that impact the EU’s energy security interests”.

In signing the Countering America’s Adversaries Through Sanctions Act, Mr Trump attached a statement calling the measure “deeply flawed”. He accused Congress, which last week overwhelmingly passed the bill and sent it to the White House, of overstepping its constitutional authority. “As president, I can make far better deals with foreign countries than Congress,” he said.

www.bbc.com

IMF Confirms Recovery of Russia’s Economy in 2017

The International Monetary Fund (IMF) confirmed its April outlook on gradual recovery of the Russian economy this year. Such statement is made by the IMF in its World Economic Outlook Update for July 2017.

“The Russian economy is projected to recover gradually in 2017 and 2018, in line with the April forecast,” the IMF said.

“Inflation in advanced economies remains subdued and generally below targets; it has also been declining in several emerging economies, such as Brazil, India, and Russia,” the IMF added.

Fund experts earlier projected real growth of GDP in Russia at the level of 1.4% in 2017.

www.tass.com

Inflation Rate Growing Because of Atypically Cold Weather

In Russia, cold weather in spring and summer can cause the decrease of harvest, which may lead to the growth of consumer prices at the end of this year and even in the first half of 2018, according to new study by the Central Bank, published on July 12.

According to the Central Bank, in June inflation rate was 4.4% in annual terms (before that the inflation rate was expected to be 4%). The growth of inflation in the first summer month was affected by prices for fruits and vegetables, which increased by 8.3% compared to May and by 27.6% from the beginning of 2017. From April to June, price for potatoes went up by 91.9%, and price for staple vegetables except for cucumbers and tomatoes rose by 67.2%, according to the data of the Ministry of Economic Development.

Earlier it was said, that the rise in prices for fruits and vegetables was attributed to the delays of the early harvest because of atypically cold weather in spring and summer. According to meteorologists, May was one of the coldest in the history of the country. However, the Central Bank believes that the spring-summer inflation is temporary.

Beside the cold weather, the inflation rate was also affected by the weakening of the ruble, experts say.

The official authorities expect a slowdown in the growth of consumer prices, including fruits and vegetables. Maxim Oreshkin, head of the Ministry of Economic Development, predicts a decline in prices for vegetables in July-August, after the arrival of a new crop on the market. According to the minister, inflation in 2017 will be 3.8%.

www.russian.rt.com

 

Russian Extends Food Import Ban Until December 2018

The Russian government has extended its retaliatory import ban on food products from countries that have imposed sanctions on Moscow.

Certain food products originating in the United States, the European Union and several other Western countries with not be allowed into Russia until December 2018, according to a document published on the Russian government’s website.

The restrictions were extended in accordance with a decree issued by Russian President Vladimir Putin on June 30. That order followed the European Union’s decision to prolong its sanctions on Russia for six months.

“These restrictions are intended to expand the special retaliatory economic measures to certain states based upon the level of their involvement in the anti-Russian sanctions regime,” the document reads.

Russia introduced its counter-sanctions in August 2014 as a response to European and American blacklists targeting individuals and companies for their involvement in the conflict in Ukraine or the annexation of Crimea.

Besides the U.S. and EU, the Russian sanctions also affect Canada, Australia, Norway, Ukraine, Albania, Montenegro, Iceland and Liechtenstein.

www.themoscowtimes.com, www.government.ru