Market News

EU Extends Sanctions against Russia

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On 19 December 2016, the Council prolonged the economic sanctions targeting specific sectors of the Russian economy until 31 July 2017.

These measures were introduced on 31 July 2014 initially for one year in response to Russia’s actions destabilising the situation in Ukraine. They were reinforced in September 2014. They target the financial, energy and defence sectors, and the area of dual-use goods.

On 19 March 2015, the European Council agreed to link the duration of the sanctions to the complete implementation of the Minsk agreements, which was foreseen to take place by 31 December 2015.

Since the Minsk agreements were not fully implemented by 31 December 2015, the Council extended the sanctions until 31 July 2016, and on 1 July 2016, until 31 January 2017. Having assessed the implementation of the Minsk agreements at the European Council meeting of 15 December, the EU heads of state and government paved the way to renew the sanctions for a further six months, until 31 July 2017. The Council formalised this decision on 19 December 2016 by written procedure and as it is the rule for all decisions on prolongation of restrictive measures, unanimously.

The European Union extended economic sanctions against Russia by six months on Monday after completing the legislative process for a decision endorsed last week by national leaders at an EU summit.

Sanctions introduced in July 2014 in response to Russian action in Ukraine will now run until July 31, 2017, the European Council confirmed in a statement.

www.consilium.europa.eu

Illegally Turkish Imported Vegetables into Russia

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A batch of Turkish cucumbers and vegetables, which were labeled as Armenian, have been destroyed by Russian authorities. The batch hadn’t been documented by the state service for food safety and didn’t receive a phytosanitary certificate. The batch of illegally imported vegetables were discovered by food inspection authorities in Russia.

“We also clarified that it was discovered in a retail network rather on the border, meaning theoretically I do not rule out the possibility that something might have been sold under an Armenian label, taking into account that the Armenian production is prestigious in terms of quality”, she said.

No evidence has of yet been release confirming the claim that the vegetables were indeed from Armenia. The total volume of the vegetables illegally imported were 6,083 kg, composed of cucumbers and tomatoes. Since the importers didn’t have the proper food safety forms the Russian authorities were forced to destroy the batch.

www.freshplaza.com

Lenta Announces the Opening of 11 New Stores Previously Operating under the K-Ruoka Brand

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Lenta, (LSE, MOEX: LNTA) one of the largest retail chains in Russia, is pleased to announce the opening of 11 new stores acquired during the purchase of the Kesko food retail business in Russia (“KFR”), previously operating under the K-Ruoka brand.

10 hypermarkets and one supermarket are opening today in Saint-Petersburg and the Leningrad region, now operating under the Lenta brand.

The total selling space of new Lenta stores is 40,0231sq.m, of which 39,657 sq.m is owned and 2,366 sq.m is rented. In terms of size and layout, the stores are compatible with existing Lenta compact and supercompact hypermarket formats, and all of the store locations are strategically complementary to Lenta’s existing stores in Saint-Petersburg and the Leningrad region. All stores are opened 24 hours, 7 days a week.

These new openings bring the total number of Lenta stores to 180 hypermarkets in 77 cities across Russia and 44 supermarkets in Moscow and St. Petersburg.

Lenta is the largest hypermarket chain in Russia (in terms of selling space) and the country’s fifth largest retail chain (in terms of 2015 sales). The Company was founded in 1993 in St. Petersburg. Lenta operates 180 hypermarkets in 77 cities across Russia and 44 supermarkets in Moscow and St. Petersburg, with a total of approximately 1,089,165 sq.m of selling space. The average Lenta hypermarket store has selling space of approximately 5,800 sq.m. The average Lenta supermarket store has selling space of approximately 1,000 sq.m. The Company operates seven owned distribution centres.

The Company’s price-led hypermarket formats are differentiated in terms of their promotion and pricing strategies as well as their local product assortment. The Company employed approximately 34,134 people as of 30 June 20162.

www.eprretailnews.com

Russia Approves State Qid to Fruit and Veg Processors

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Russian Prime Minister Dmitry Medvedev has signed a decree which approves the list of agricultural products that will benefit from state aid granted to organizations involved in their processing. This was reported by the press service of the Russian government.

According to the document, the list includes, in particular, processed and preserved fruit and vegetables and other agricultural products.

“The approval of the list will allow the state to provide support in the development of agriculture, increasing the availability of credit resources for organizations and individual entrepreneurs devoted to the processing of agricultural products,” said the document.

Also, the report says that state support will be exclusively provided to organizations for which the sale of these products generates at least 70% of their annual income.

www.freshplaza.com

More Greenhouse Vegetables in Russia

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Russian greenhouse complexes continue to increase the gross harvest of vegetables, according to the Ministry of Agriculture of the Russian Federation. The total yield of greenhouse vegetable as of November 29 amounted to 607,100 MT in the whole country, which is 31% more than the year before. In particular, the yield of cucumber increased by 23% and amounted to 409,400 MT. Total harvest of tomatoes amounted to 182,500 tons, which is 53% more than the same period last year.

The Ministry of Agriculture suggests postponing lifting the ban for Turkish tomatoes import until 2018-19 to protect Russian tomatoes production. After the ban, tomatoes production increased by 35%.  Just to compare, in 2012 Russian tomatoes had the share of the market 17% and in 2016 it is expected to be 40%.

www.fruit-inform.com

 

Russia Bans Re-export of Fruit and Veg from Guinea, Afghanistan and San Marino

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Starting from 28 November, Russia’s Federal Service for Veterinary and Phytosanitary Surveillance (Rosselkhoznadzor) has introduced a ban on the supply to Russia of vegetables and fruit from Guinea, Afghanistan and San Marino, through third countries, because of the increased volume of re-exports via Belarus, said the agency.

“From 28 November 2016, the Rosselkhoznadzor will only allow direct shipments to Russia of regulated products of high phytosanitary risk originating from the Republic of Guinea-Bissau, the Islamic Republic of Afghanistan and the Republic of San Marino,” said the statement. Products from these countries will be allowed through the checkpoints on the Russian section of the border of the Eurasian Economic Union only when accompanied by the right phytosanitary certificates.

www.freshplaza.com

Russian Consumer Worse off

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The majority of Russians are noticing that prices for fruit, vegetables and meat have increased, according to research done by Itar-Tass. Respondents indicated they are spending more money on these food. Not only do consumers notice a downside to the boycott due to prices in supermarkets, products on the shelves have also changed. Belgian newspaper De Standaard visited a Russian supermarket, and found a stripped assortment of meat. It is also difficult for industry, Russian companies invested too little, and cannot compete with Western techniques.

According to the Russian static service, the consumer price index has increased by six per cent in the past 12 months. Economic indicators are also still in the red. October experienced a decrease of 4.4 per cent in retail sales.

www.freshplaza.com

 

Russia Signs Agreement for Green Corridor from Syria

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The Russian Federation and Syria have signed an agreement in Damascus for the creation of a green corridor for the export of agricultural products from the Arab republic.

The Deputy Prime Minister of Russia, Dmitryi Olegovich Rogozin, who heads the Russian part of the permanent bilateral commission on trade-economic and scientific-technical cooperation, stated that the Russian side is ready to consider any strategy that will serve to support the economy of the Syrian Arab Republic, and that Syria “will actively supply citrus fruits, vegetables and other fruit crops, which are of the highest quality.”

According to Rogozin, “Syria used to be a supplier of oil and grain, but now Syria has no oil or grain or other products. In this sense, the Russian Federation considers every opportunity to support the trade and economic relations with Damascus.”

Dmitry Rogozin also announced that president Assad promised to guarantee the right conditions for the development of Russian projects in Syria.

www.freshplaza.com

Turkey Expects Russia to Lift Ban on Five More Fruit and Veg

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Ankara expects Moscow to soon lift the ban on the import of five types of Turkish plant products – pomegranates, aubergines, peppers, courgettes and lettuce, as stated by the Minister of Agriculture on Monday.

Faruk Çelik, the Turkish Minister of Agriculture, said that another 11 kinds of Turkish plant products would remain banned. “With regard to them, the Minister of Agriculture of the Russian Federation, Alexander Tkachev, said that a decision would be made during the visit of Prime Minister Binali Yildirim to Russia (5-6 December),” stated the Minister.

The improvement in Turkish-Russian relations have already ensured an increase in the export of Turkish fruit and vegetables. Compared to the same period a year previously, the Turkish export of tangerines has increased by 41 per cent. With that, export amounted to 90,211 tonnes. The export of oranges increased by 27 per cent to 26,000 tonnes. Last year, between 19 October and 16 November, Turkey exported 63,794 tonnes of tangerines and 20,713 tonnes of oranges, amounting to a total value of 43 million dollar. During the same period this year, Turkey earned over 44 million dollar through the export of tangerines alone.

www.freshplaza.com

Russia to buy $2.5B of Filipino agri produce

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Officials report that during bilateral discussions between President Duterte and Vladimir Putin, Russia committed to buy up to a staggering $2.5 billion worth of fruit, grains and vegetable from the Philippines.

Trade Secretary Ramon Lopez said the Russian side agreed “immediately” to a proposal for the importation of Philippine fruit and other agricultural products in the next 12 months.

“Their immediate estimate is $2.5 billion. That’s a number they [the Russian side] quoted,” the Cabinet official told Filipino journalists covering the Asia-Pacific Economic Cooperation (Apec) Leaders Meeting in Peru’s capital.

This dwarfs the $46 million worth of exports the Philippines currently ships to Russia every year, he said.

“We were talking of what they could buy from us, especially agricultural products, but nothing was specified. But I understand we supply them with a huge quantity of bananas… and mangoes. With these kinds of discussions, these present more trading opportunities between us,” Lopez said.

Lopez said Putin also offered to help the Philippines through investments in energy and infrastructure.

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