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Russia’s retail news August 2012

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In the beginning of August it was announced that 20 August Luc Koenot would become a new CIO of X5 Retail Group, before he was a SVP & CIO at the large Belgium retail company Delhaize Group.

Andrej Rogachev who was one of the founders of retail networks Pjaterochka and Karusel (now they are the parts of X5 Retail Group) is going to open a new discounter network Okey-Dokey in the USA. The first store will be opened 1 September in Miami. It is planned to open 8-12 discounters till the end of the year and 50 stores more in 2013. Agro-Trade International is going to develop the network; the investments into the project are estimated at about $500 million.

Finnish retail network Prisma is going to open 2 new supermarkets in St. Petersburg in August and in October, so the total amount of Prisma supermarkets will be 11 in St. Peterburg and Leningrad region. By January 2013 the company is going to open 3 supermarkets more.

Source: www.retailer.ru

Russian apple production will increase by 8%

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More than 250 representatives of the international apple and pear sector met on the occasion of the 36th Prognosfruit Conference on 3rd August 2012 in Toulouse (France). On this occasion, WAPA (World Apple and Pear Association) released the 2012 European apple and pear crop estimates. The 2012 apple and pear production in the EU will be significantly lower than average given unfavourable climatic conditions in winter and spring across Europe. Apples will decrease by 9% compared to the previous year while pears are estimated to have a lower crop by 22% compared to 2011.

More specifically for apples, the 2012 European crop forecast is announced at 9.739.000T. This production is 7% lower than the average for the last three years. In regard to varieties, Golden Delicious production will be down by 15% to 2.212.000T. Gala will decrease by 6% to 1.070.000T. Red Delicious will decrease by 18% to 555.000T, while Idared will go up 34% given a larger crop in Hungary and Poland. With the exception of Poland which will witness a larger crop (2.8 Million T) due to new plantings, most of the Member States will record lower crops; this will also be reflected in the varieties breakdown.

Regarding pears, European growers predict a significantly lower crop down 22% compared to 2011. Indeed, it is reported that the new season crop will reach 2.060.000T, compared to 2011 production which reached the peak of 2.629.000T. The 2012 forecasted crop is also 17% lower than the average crop of the last three years. In 2012, the Conference variety will see its production decrease by 21% to 743.000T, William BC will decrease by 19% to 255.000T, and Abate F will also decrease by 26% to 284.000T. Elsewhere in the Northern Hemisphere crops have also decreased compared to last year, namely in the USA (-7%) and Ukraine (-8%).

Overall, climatic conditions have not been favourable in many parts across Europe during blossom and the  beginning of the growing period of the fruit. Under these particular weather circumstances having their impact on the production, the relevance of transparency of data is important and the effort of Prognosfruit/WAPA in this respect is underlined. The new season is to start according to the normal harvesting schedule on a basis of clear stocks from the last season and no overhang with Southern Hemisphere fruit while there are no pending stocks for apple juice concentrate which should strengthen the market for the benefit of the sector and provide better return to growers after several difficult seasons.

Source: www.fruitnews.ru

Affect of Russia’s accession to the WTO on fish import duties

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Due to Russia’s accession to the WTO, nearly all categories of fish and seafood will see a reduction in tariffs, although reductions may not occur immediately with accession.

Frozen, fresh and chilled fish (excluding filets) will see reduced tariffs between 2013 and 2017. The pre-accession applied bound rate is currently 10 per cent; the final bound rate is expected to fall between eight and three per cent depending on species. For salmon and trout fillets, the final bound rate is expected to be four per cent by 2016, and for cod fillets, to five per cent by 2015.

Tariffs on frozen hake and pollock fillets will fall to seven per cent by 2014. For crustaceans, the tariff on whole lobsters will fall from 10 to only five per cent with this change occurring by 2015 for frozen and by 2016 for live lobsters. For non-whole frozen lobsters the tariff will fall from 10 to eight per cent by 2013.

For frozen shrimps and prawns, the current tariff will fall to between five and three per cent by 2014-2015 depending on variety. For frozen crabs, it will fall from 10 to five per cent by 2015-2016 depending on variety. For mollusks, the pre-accession applied/post-accession bound rate will fall to seven per cent by 2015 for oysters, for scallops to six per cent by 2015 and for mussels to five or six per cent by 2016-2017 depending on variety.

Source: www.thefishsite.com

Europe’s apple and pear crops down

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Apple and pear production in the European Union will be “significantly lower” than last year and, as reported by Eurofruit last month, the forecast apple crop is set to fall below the 10m-tonne mark for only the third time in a decade.

Publishing the forecasts, the World Apple and Pear Association (WAPA) said apple volumes would decrease by 9 per cent against the previous year’s figure to 9.74m tonnes, while it estimated the pear crop would be around 2.06m tonnes – 22 per cent lower compared with 2011 and the lowest forecast figure since 1997.

Elsewhere in the Northern Hemisphere, apple crops are also expected to decrease compared with last year, with a 3 per cent estimated downturn in Turkey and lower output too in the Balkan countries. Russia and Ukraine’s crops, meanwhile, are forecast to increase by 8 per cent and 4 per cent respectively due to new bearing trees. Official data for the US is due to be released in mid-August, but initial indications are that the country’s apple crop will be 15 per cent smaller due to heavy frost in the Midwest region and, to a lesser extent, in the north-east.

Elsewhere in the Northern Hemisphere, pear crops are also going to be down compared with last year, notably in the US (-7 per cent) and Ukraine (-8 per cent).

Source: www.fruitnet.com

WTO accession should lower prices for consumer

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It is hard to find more solid proof of capitalism’s victory in Russia than the upward trajectory of its consumer market. If the supremacy of manufacturing is no longer recognized as the core imperative for a healthy economy, Russia can claim to be one of the world’s most advanced countries. It has now become Europe’s largest consumer market – retail trade generates a quarter of gross domestic product. In the past 10 years, personal consumption has been stubbornly overtaking production, and the gap between domestic supply and demand is increasingly being filled by imports. By all estimates, whether or not Russia joins the World Trade Organization, this gap will remain; the question, however is how the WTO will affect its size.

Russia has already become a part of the global market without the membership. To see how it belongs to world economy in terms of satisfying consumer needs, it is only necessary to look at one of the best consumer market mirrors – retail hypermarkets.

The rapid development of organized retail trade in Russia is an economic phenomenon that by itself proves the wonders market forces can do when they are not overregulated by red tape. The increase of personal incomes beginning in the last 1990s combined with a growth in domestic fixed capital outlays resulted in an explosion of organized retail trade, starting in Moscow and St. Petersburg and then extending to the rest of the country. In the last 10 years, retail trade in Russia has attracted over $20 billion of direct foreign investment.

It’s likely that with Russia’s accession to the WTO, price and availability of these imported goods will improve, to the benefit of Russian consumers. On a recent trip to the market, Auchan customers seemed more concerned with the price and accessibility of their purchases than their provenance. Potatoes from the Ryazan region, not far from Moscow were cheaper than potatoes from Israel, Egypt or Saudi Arabia, but they were also packed in a less-convenient way, which kept them on the shelves longer. The Russian garlic was offered in kilogram packs each priced at 107 rubles while more popular Chinese garlic was sold in packages of three cloves in small knitted bags for 18 rubles. Perhaps WTO access will also allow Russian suppliers to benefit from the marketing tools employed by their foreign counterparts.

Source: www.freshplaza.com

Argentina: Apple and pear exports drop 30%

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Apple shipments fell by 38% and pear sales to Russia fell by 12%. Regional fruit shipments destined for overseas markets reached 273,300 tons on June 15th. The figure represents a fall of 32% compared to consolidated exports for the same period of last year. This was revealed in a recent study, by the North Patagonian port terminal, in which it is detailed that pear sales overseas reached just over 196,300 tons, 27% lower than what was reached in the same season of 2011.

As for apples, the collapse was even greater. Statistics showed that 72,400 tons were exported, 38% less than last year. The data included information about the regional fruit shipments sent only through the port of San Antonio and Bahia Blanca. However, it is noteworthy that these terminals account for 85% of exports to overseas markets.

The report highlights that for Northern Patagonia, Russia remains the main destination of regional export supply. According to the report, shipments to St. Petersburg reached about 108,000 tons of fruit, of which more than 53,000
were for pears and 24,400 apples.

Note that Russia remains an important destination for valley pears. Shipments this year experienced a drop of only 12% compared with the previous year. It must be noted that the average fall for valley pears bound for overseas stood at 27%.

When analyzing the evolution, that the region has undergone in apple sales to Russia, we see that the drop in shipments in this season is close to 50%. An important figure, given the fact that two years ago Russia imported from Argentina
90% of the apples from the Southern Hemisphere. Today that ratio is 50%.

Bahia Blanca´s port regional fruit Shipments  reached, so far this year, 11,600 tons (5% of the total overseas sales), reflecting a decrease of 7% compared with records from the previous season.

Source: www.freshplaza.com

Russia’s accession to the WTO

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In the beginning of June, the Russian government approved the agreements for the country’s accession to the World Trade Organization (WTO) and sent them to the State Duma, the lower chamber of the Russian parliament, for ratification.

All documents to become a full member of the WTO must be ratified by the Russian government, parliament and president by July 23, 2012. Russia spent 18 years trying to enter the WTO, completing its accession in December 2011.

The Federation Council is ready to ratify the protocol on Russia’s accession to the WTO meeting on 18 July, when by the time the document will be approved by the State Duma, told RIA Novosti on June 28, Federation Council Speaker Valentina Matvienko.

The State Duma will examine the documents at its meeting on July 4.

Sources: en.rian.ru, www.retailer.ru