Short and medium term consequences of the Russian ban
“In the majority of Russian cities, large or small, the citizens are not self-sufficient in terms of food supply. Consumers have jobs to do that are unrelated to the agricultural world in most cases. Many products also can’t grow in the northern territories of Russia, so a decrease in fresh produce supply and consumption will be inevitable,” assures Irina.
Irina believes that, in any case, most consumers will be likely not to blame the ban for the lack of fresh produce, but either the retailers themselves, or the importers, distributors or foreign exporters.
“Countries in the Southern Hemisphere, such as Argentina or Chile, have a different supply season, and their supply volume is not as large in general, so they will not be able to fill the gap left at retailers, at least not immediately. For example, the total shipments of Chile to Russia represent just 5% compared to those from the EU, and Argentina is only close to 10%,” explains Irina. “The shipments also take much longer to arrive, compared to the few days it takes from Poland.”
How the situation will develop is unpredictable at this stage. It is definitely going to affect most consumers, even if they are not aware of it, but whether it will have a political impact, it is difficult to know. “It is also unlikely that the Government will help Russian importers. I heard that the Russian agricultural sector was allegedly going to get some money, but not that much,” affirms Irina.
The ban has been a source of instability which, according to Irina, will reduce the chances for investment in the sector, “as this is an industry that takes a long time before it pays back. Business plans span over many years, and if the ban was lifted, for example, in a year, any large-scale investment in greenhouses or orchards would go nowhere.”
Turkey, Israel and Serbia
For exporters in non-EU countries, the short and medium term future is looking a little brighter. Aysel Oguz, of the Turkish company Eren Tarim, believes that “this will be a season with great potential in the Russian market. The citrus season will not start until September, but when it does we’ll know for sure how much of an impact it will have. We also expect a good lemon harvest, so it will all be down to demand.”
Oron Ziv, from the Israeli firm Befresh Europe, says that “it will all depend on the product and the prices. The country’s pepper shipments, for example, will certainly shift towards Russia, but Russian importers may not be able to pay for some of the most expensive products.”
Sonja Vladimir, of the Serbian exporter Agroprom, affirms that right now the number of orders from Russia is already increasing, although at the moment only moderately. “The prices we set, among other aspects, depend on demand, so the situation is definitely going to be advantageous, although we will remain focused on our long-time, regular clients.