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Supermarket loses customers after sales sanctioned products

Year of Russian product embargo in figures

Polls show that the majority of Russians support the embargo, in spite of the rise in food prices. This week marked one year since the introduction of Russian food sanctions: up to the introduction of these sanctions, imported foreign foodstuffs made up more than 30% of the Russian market.

Below is a figures summary of the year of the Russian retaliatory sanctions.

40 % - drop in food product imports to Russia
In 2014, food imports to Russia amounted to €37 billion, and by the end of 2015 will amount to €22.6 billion, said the Minister of Agriculture, Alexander Tkachev this week.

€7.22 billion - more state aid to agriculture
The government's anti-crisis plan, adopted in the winter of this year, provides additional funds for state agriculture.

€2.2 billion - loss of Europe from the Russian embargo
Food exports to Russia from countries under the counter sanctions, from August 2014 to April of this year decreased by €2.2 billion. Earlier, the union of European farmers and agricultural cooperatives Copa-Cogeca assessed the damage from the Russian response to be €5.5 billion. There are no precise figures concerning European farmers’ losses.

400 % - an example of unjustified price increases for some products.
Russian Prosecutor General, auditing retail chains in winter, called the situation with the growth of food prices “depressing”. As of mid-March this year, according to media reports, prosecutors opened around 1,500 criminal cases in connection with inflated food prices.

87% - Russians supported the extension of food sanctions against western countries
According to a July survey, 87% of Russians believe that the authorities did the right thing by extending the food embargo in June this year, after the United States and Europe extended their sanctions. A year ago, a similar study by VTsIOM fixed support for the embargo at 84%.

Average price of imported apples in Russia fell
From September 2014 to February 2015 the average price of apples imported to Russia fell from €0.57 to €0.43/kg. According to the survey "Export and import of apples in Russia from March 2014 - February 2015” prepared by BusinesStat, in the defined period Russia was a net importer of apples: the country imported more of the finished product than they exported abroad. At the end of the period the volume of net imports amounted to 957,500 tons of apples.

Experts say that the trend in the decline of demand for expensive apples in Russia is connected to the general decline in the solvency of Russians. In this regard, the Russian market has taken advantage of countries that can offer low-cost apples.

Russian supermarket loses customers after revealing sanctioned products sold

The directorship of supermarket ‘Okean’ is demanding that the media publish a refutation of publications made on the basis of information from the prosecutor's office, reports

They claim that “the Russian Federation Prosecutor General's Office has not verified the information, concerning sales of products forbidden under the import sanctions. We believe the information contained in the article is false and damaging to the business reputation of the LLC ‘Okean’.”

In the text published by ‘Fonar’ with reference to the material on the website of the General Prosecutor's Office, three varieties of onions and a single variety of kiwi included in the sanctioned list of products and originating in the Netherlands and Italy, were found in the store. The regional prosecutor's office has confirmed to ‘Fonar’ that an inspection was conducted in the supermarket ‘Okean’ in late 2014. An administrative case was brought to the store manager in January 2015 but to date, the administration of "Okean" continues to refute the claims, although they acknowledge that the inspection took place and produce was found among the deliveries.

Moldova allowed to export fruit to Russia
According to a decision posted on the Russian Ministry’s website, the Rosselkhoznadzor has authorized a number of Moldovan enterprises to import Moldovan pears, quinces, apricots, cherries, peaches, nectarines, plums and sloes to Russia.

The Moldovan Ministry of Agriculture and Food Industry welcomed the decision of the Rosselkhoznadzor to resume the imports of Moldovan fruit in Russia, stated department’s minister Ion Sula to RIA Novosti on Thursday.

"The Moldovan side welcomes the decision of the Rosselkhoznadzor. All Moldovan agribusinesses are ready to confirm that their products meet all the parameters for export to Russia," - said Sula.

The Agriculture Minister said that Moldova supports the renewal of the previous volume of exports of their goods to the Russian Federation.

Relations between Moscow and Chisinau deteriorated last summer when the Moldovan Parliament ratified the Association Agreement with the EU, signed by the Government in Brussels. Under the agreement, Moldova should fully open its market to European goods. Russia, fearing that the CIS market and the Customs Union via Moldova would re-export the goods arriving from the EU, imposed a temporary ban on the import of certain types of Moldovan products. In February this year, the Russian Federal Service for Veterinary and Phytosanitary Surveillance allowed the import of Moldovan apples.

Belarus gains most from Russian embargo
A year ago, the Russian media reported that a lot of countries - Brazil, Turkey, China and others - were happy to replace imports from banned countries to Russia. The only country which has managed this is Belarus, the rest fell short of expectations.

Based on the latest statistics of the Federal Customs Service (to the end of May 2015), import substitutions from Belarus increased the most: the share of the country's food supply to Russia rose to 21% from 13.5% .

Turkey is second in terms of the supply of import substitutions. Although the country promised to double their exports to Russia, the amount of exports from January to May of this year remained practically the same as last year.

Ecuador pledged to increase fruits and vegetable exports to Russia, but they in fact decreased in volume significantly from 577,000 tons to 523,200 tons. Brazil has also been unable to meet expectations; hailed as the ‘main benefactor’ of Russia’s sanctions last year, the country promised to increase their exports of several food items, but in fact their exports also decreased in the first 5 months of this year.

China in the same period also decreased their supply of import substitutions to 390,000 tons from 418,000 tons. Despite claims that their fruit and vegetables would replace European produce on the Russian market.

New Zealand reduced its food exports by 69%. Last year, Russian authorities stated their desire to increase imports of cheese from the country, but the New Zealand producers reacted with apprehension to the prospect of strengthening ties with Moscow.

Sanctioned fruits and vegetables "settle" on the markets stalls in Belarus
Experts say that Belarusian merchants are trying to buy fruits and vegetables to be destroyed in the RF.

Russia decided that starting from August 6, sanctions goods will be destroyed at the border. On Thursday the RF held its first action for the destruction of such goods. At the same time there are cases recorded where truckers have tried to go back to Belarus, to prevent the loss of cargo.

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