Temporary Price Increases for Fruits in Russia Predicted for Winter and Spring 2021

According to preliminary estimates from the Horticulture Union of the Russian Federation, the apple harvest in the commodity sector amounted to 708,000 mt in 2020, which is 30% lower than a year earlier due to late frosts in a number of major producing regions. However, experts have not yet noted an increase in fruit imports in relation to the decline in the harvest.

The company Technology Growth believes that fruit and berry imports in 2020 remained at the level of 2019. Russia imported about 1.7 million mt of traditional fruits – apples, pears, peaches, cherries, and grapes. “This result was achieved due to the high harvest in 2019 and in the first half of 2020 there were very few imports. Before the New Year, our enterprises were selling products harvested last autumn,” explains the general director of the company Tamara Reshetnikova. “However, in 2021, due to a low harvest, the import of fruits will increase since its supply will be limited. Prices for all fruits will increase in winter and spring,” the company experts predict.

However, the growth in import volumes and prices will be temporary believes the Horticulture Union believes. If there are no weather disasters, the fruit harvest in 2021 will exceed the record figure of 2019. “The fact is that 2018 and 2019 became record-breaking years for the establishment of perennial orchards and this year they will begin to bear fruit. Accordingly, in the new year one can expect not only a record collection but also a decrease in prices on the shelf and a decrease in imports,” Mikhail Glushkov, director of the Horticulture Union told Agroinvestor.

The Russian Farmers Association is also optimistic. Its president Igor Mukhanin recalls that in 2019, there were 16,000 hectares of orchards planted despite the original plan of 10,500 hectares and in 2020, another 14,000 hectares were added. “Apple production annually increases by 150,000-200,000 mt and the productivity of orchards is growing. If such rates continue, then in five to six years, our country will completely replace its demand for marketable apples, which is 2 million mt against 1 million mt being produced now,” he said.

Mr. Mukhanin adds that in a few years when Russian farmers saturate the market with apples of their own production, they will be able to export them. “We have high export potential. We grow apples with minimal use of herbicides and pesticides – three times less than in Poland and five times less than in Italy. Due to the fact that Russia has cold winters and a temperate climate, we do not have such an acute problem with pests, there is no need to cultivate orchards all year round,” Igor Mukhanin emphasizes. He is sure that horticulture is the industry that could help in the development of rural areas.


Georgia Increases Fruit and Vegetable Exports to Russia Prior to New Year’s Eve

The period right before New Year’s is usually characterized by an increase in traffic on transit roads, which causes slowdowns and traffic jams. This is due to exporters trying to get their products on the markets before the New Year. According to exporters, this year, the road situation is no different from previous years and there are no significant disruptions or issues associated with the pandemic except in the search for drivers.

Prior to New Year’s Eve, fruits and vegetables – mainly mandarins, persimmons, apples, and herbs – are exported from Georgia. Russia is one of the main export countries for Georgia. According to information from export companies, by now, their products are already on their way to markets and there are no more new cargoes planned for December. Since sales are active during the period prior to New Year’s, trade is reduced after the New Year.

According to Vakhtang Bezhitashvili, the founder of Fruitilia in Georgia, the traffic on transit roads in the direction of Russia is increasing prior to New Year’s. “I cannot say that there are any special delays on the roads. High traffic and corresponding queues on the roads are common during this time. Our company carries out both the export and import of agricultural products. The resulting queues on the roads are a problem only for perishable goods in refrigerated trucks. A long delay of such a product on the road means a decrease in its quality. For example, if during the normal period a trailer reaches Russia in three days, it may take a week leading up to New Year’s. A solution to this problem is possible if the transportation of perishable goods is given priority on the roads. This implies allowing refrigerated trucks to enter the first rows so that they do not have to stand in line with trucks loaded with non-perishable goods. This is the accepted practice in the world. In Georgia, this practice is used only at customs, which, of course, is not enough. It often takes several days to get to customs.”

According to official data for the period from January to November 2020, the largest amount of mandarins and apples were exported from Georgia to Russia. Russia accounts for 92% of the total export value of apples and 80% for mandarins. In January-November 2020, apples worth $3.03 million and mandarins worth $3.66 million were exported from Georgia to Russia. However, the season is not over yet and, in January, both mandarin and apple exports will continue.


Geography Narrowed and Export Volumes Decreased for Moldovan Grapes in 2020

According to data from the National Agency for Food Safety (ANSA), as of mid-December this year, slightly more than 48,000 mt of table grapes were exported from Moldova to 22 countries. Due to the reduction in prices for the main export grape variety Moldova, this indicator will not change significantly by the end of 2020. In 2019, local exporters sent almost 79,000 mt of grapes to 29 countries.

Comparing this year to last year’s figures, the export volumes of Moldovan grapes have decreased in virtually all countries. There was a significant reduction in supplies to Belarus (from 5,400 mt to 1,790 mt ), Iraq (from 2,110 mt to 286 mt ), Romania (from 18,650 mt to 10,720 mt ), and Ukraine (from 7,900 mt to 4,200 mt ). The volume of exports increased only to Poland from 1,580 mt to 1,700 mt.

Members of the Moldovan Table Grape Producers Association note there are still a lot of products in the refrigerated warehouses of vineyards in the thousands of tons. These are mostly the highest quality grapes that they intended to sell in December at a high price. However, from the middle of this month, the price of even high-quality grapes has not significantly increased. Taking this into account, the association’s experts forecast for price dynamics in the first half of January 2021 is not optimistic.


Russia Allows the Export of Products from Several Azerbaijani Enterprises

The Azerbaijani Food Safety Agency and a number of relevant structures are taking the necessary measures to remove restrictions on the export of certain products to Russia. The export of apples and tomatoes from Azerbaijan to Russia was widely discussed during several meetings.

As a result of discussions between the delegations of the Food Safety Agency and the Federal Service for Veterinary and Phytosanitary Supervision of the Russian Federation., the export of tomatoes from Agroterm LLC (Khizi district), Geothermal Agro LLC (Kurdemir district), Gp Alfa greenhouse LLC (Salyan district), Hajigabul greenhouse LLC (Hajigabul district), and the enterprises belonging to Ilkin Shukurov (Masalli district) was allowed.

The export of apples from “TURAZ” LLC (Shabran district), Ran Fruit LLC, and an enterprise belonging to Vahid Asadov was also allowed. The relevant structure issued the export permits on the basis of the files submitted by the Agency on strengthening phytosanitary control, as well as on the results of relevant monitoring.


The EU Extends Sanctions on Russia for 6 More Months

On Thursday, December 10, the European Union’s heads of State and Government renewed the economic sanctions against Russia for its role in the crisis in eastern Ukraine until June 30, 2021.

The EU first introduced the sanctions on July 31, 2014. The sanctions are focused on the finance, energy, and defense sectors, as well as on dual-use, civil, and military products. They also restrict Russia’s access to certain sensitive technologies and services that can be used for oil exploration and production.

The sanctions also limit access to the primary and secondary capital markets of the EU for five major Russian financial entities – Sberbank, VTB Bank, Gazprombank, Vnesheconombank, and Rosseljozbank – which have majority participation of the State, and its subsidiaries that also have a majority State participation and that are established outside the EU.


Russia Bans the Supply of Selected Fruits and Vegetables from Uzbekistan, Armenia, Azerbaijan, and Turkey

The list of new bans announced by Rosselkhoznadzor citing quarantine issues with supplies of vegetables and fruits to Russia as they unfolded this week.

– Ban on the supply of greenhouse tomatoes and peppers to Russia from the Fergana region of Uzbekistan due to the detection of the tomato brown rugose fruit virus (ToBRFV);

– Ban on the supply of dried apricots and all plant products to Russia from the Fergana region of Uzbekistan after the discovery of a quarantine object – the khapra beetle (Trogoderma granarium Ev.) – in a batch of dried apricots for Russia and the EAEU member states;

– Ban on the supply of greenhouse tomatoes and peppers from the Kashkadarya region of Uzbekistan due to the discovery of the tomato brown rugose fruit virus (ToBRFV) and for the same reason from the Navoi region of Uzbekistan;

– Ban on the supply of greenhouse tomatoes and peppers to Russia from the Armavir region of Armenia due to the detection of the Pepino mosaic virus (PepMV) in a batch of products;

– Ban on the supply of apples and greenhouse tomatoes from Azerbaijan to Russia due to multiple violations of quarantine laws. This, according to EastFruit, will also affect a significant part of the supply of these products from Iran since a significant amount of Iran’s products enters Russia in transit through Azerbaijan;

– Ban on the supply of greenhouse tomatoes and peppers from the Izmir and Antalya provinces in Turkey due to the systematic identification of quarantine objects such as South American tomato moth (Tuta absoluta (Meyrick)), Western California (flower) thrips (Frankliniella occidentalis (Perg)), Pepino mosaic virus (PepMV), tomato spotted wilt virus (TSWV), and tomato brown rugose fruit virus (ToBRFV).

– Ban, more than a month ago, on the imports of tomatoes and peppers from Grodno, Gomel, Minsk, and Brest regions of Belarus due to the detection of the Pepino mosaic virus (PepMV).


Rosselkhoznadzor bans import of tomatoes and apples from Azerbaijan from December 10

Starting fromDecember 10, the Rosselkhoznadzor banned the import of apples and tomatoes from Azerbaijan to Russia due to the detection of pests in products from this country, the Russian department said.

Earlier, the Rosselkhoznadzor reported to the Food Safety Agency of the Republic of Azerbaijan about cases of detection of objects quarantine for the EAEU member states in regulated products that are supplied to Russia.

The department noted that in order to prevent the import and spread of pests in Russia, the Rosselkhoznadzor prohibits the import of tomatoes and apples of Azerbaijani origin into Russia from December 10, 2020.

The Rosselkhoznadzor also clarified that since October 22, 2020, 17 cases of South American tomato moth (Tuta absoluta (Povolny) and eastern moth (Grapholita molesta (Busck)) have been detected in apple and tomatoes from Azerbaijan.


Russia is a World Leader in Mandarin Imports, Despite a Drop in Volume

Russia continues to be the world leader in terms of importing mandarins and their analogs (clementines, tangerines, satsuma, etc.) by a wide margin, despite the decline in volumes and imports observed in recent years.

In 2019, Russia imported 713,200 mt of mandarins, significantly less than in 2014 when the country imported 847,000 mt of these citrus fruits. However, the second place in the world ranking belongs to Germany, having imported more than two times less than Russia, namely, 346,000 mt of mandarins. Other leaders in terms of import volumes are France, the United States, Great Britain, and Ukraine.

Besides, unlike Russia, Ukraine continues to increase its imports of mandarins. In 2014, Ukraine imported 158,000 mt of mandarins and a record volume in 2019 of 180,300 mt.

Partially, this decline in imports of mandarins to Russia is explained by the so-called “anti-sanctions”: Russia cannot purchase fruits in the EU countries because of the ban. At the same time, Ukraine continues to buy large volumes of mandarins from the southern countries of the European Union, such as Spain, Greece, and Italy. Russia, in addition to Turkey, buys mandarins from Pakistan, China, Morocco, and Georgia, which significantly narrows the possibilities of importing premium quality fruits. Therefore, traditionally, Belarus is engaged in re-exporting citrus fruits from the sanctioned regions to Russia.

It is interesting to note that in the first ten months of 2020, Russia dramatically increased its imports of mandarins. Morocco provided the main increase in supplies: in 2020, deliveries of mandarins from Morocco to Russia increased by 59%. Pakistan and Turkey also increased their export volumes. Mandarins’ supplies to Ukraine also increased in 2020, but the growth rates of imports were lower than in Russia.


Georgia Exported over 7,800 mt of persimmons since start of season

The Ministry of Environment and Agriculture of Georgia reported that Georgia exported 7,824 mt of persimmons (including the kinglet variety) from 1 August 2020 to 23 November 2020, which is up 14% than a year ago. In monetary terms, persimmons exports amounted to $4.2 million, which is 18% more than last year. Also, “during this period, the export price for persimmons increased by 4%,” the ministry said.

Russia received the most persimmons from Georgia at 3,377 mt (or 43% of the total export of this crop) followed in second place by Ukraine with 2,832 mt among export markets and Armenia in third place with 1,475 mt. Georgian persimmons are also exported to Belarus, Qatar, Moldova, Hong Kong, Kazakhstan, and Hungary.

According to official data, Georgia exported roughly 8,000 mt of persimmons in all of 2019. The main sales markets were Armenia (4,300 mt), Ukraine (2,700 mt), and Russia (800 mt). In monetary terms, exports amounted to $4.2 million.

Mass harvesting of persimmons in Georgia usually takes place from the second half of October to the second half of November. Persimmon fruiting in many modern orchards begins in September and continues for several months. Of note is that more than 100 hectares of intensive persimmon orchards were developed with the support of the state project “Plant the Future.”

Persimmons production has been growing in Georgia over the past 3 years. The harvest of persimmon amounted to 8,900 mt in 2017, 10,000 tons in 2018, and 14,300 mt in 2019.

The main regions of Georgia supplying persimmons to the market are the Kakheti region in Eastern Georgia, Imereti and Samegrelo regions in Western Georgia, and the Adjara region.


The share of imported vegetables in Russia may decrease to 10% in five years

Over the next five years, the share of imported vegetables on the Russian market may decrease from 16% to 10%. This forecast is given by the Center for Industry Expertise of the Russian Agricultural Bank. According to the forecast, in 2019, 558,000 mt of tomatoes and about 100,000 mt of cucumbers were imported to the Russian Federation, and by 2025 the import of these products may decrease to 347,000 mt and 36,000 mt, respectively.

According to forecasts of the Ministry of Agriculture, this year the production of greenhouse vegetables will increase by 6.1%, to 1.25 million mt year-on-year, which will be a record figure. The Center for Industry Expertise of the Russian Agricultural Bank expects that Russian operators of greenhouse facilities will continue to increase production by an average of 7% per year. And the consumption of fresh vegetables in the country will grow by about 1% annually and will reach 115 kg per capita by 2028. Today it is  109 kg per capita.

Producers of greenhouse vegetables applied to the Ministry of Agriculture with a request to allocate 5 billion rubles from the budget of incentive subsidies to compensate for the part of the costs. As noted in the association “Greenhouses of Russia”, options for supporting the greenhouse industry needs to be intensified, as companies are faced with a decrease in consumer demand and the negative impact of the COVID-19 pandemic. As a result, the profitability of greenhouse operators fell to 5-7%.