The issue of the access of Turkish agricultural products to the Russian market could be solved this year, according to a statement from Turkish Deputy Prime Minister, Mehmet Şimşek.
"Our relations have improved, but there are still plenty of issues to be resolved before we can go back to the position we had in 2015. These include access to the Russian market for Turkish agricultural products or a further simplification of the visa regime, but in general, the situation has normalised. We are once again on good terms," he said.
The return of Turkish fruit and vegetables to the Russian market may increase competition, which is already growing rapidly on the part of Russian producers. It is likely that Turkish suppliers will be seeking to regain a share of the Russian market as soon as possible and may behave aggressively, using dumping strategies, for example, and this could of course lead to lower consumer prices.
According to the director of the analytical centre "Sovecon", Andrey Sizov, Turkey's return will not be quite so severe a shock to Russian agro-business. "Of course, Russian consumers do not wake up at night crying from the fact that they haven't been able to eat Turkish tomatoes for a long time, but what is true is that after the return of Turkey to the market, we can expect a slight decline of cucumber and tomato prices. Russian producers won't be happy with it, but they shouldn't be afraid of serious and quick price drops."
Perhaps the re-entry of Turkish products will not entail an immediate return to the volume that was shipped prior to the introduction of sanctions. During this time, other suppliers have come to replace them, and the number of Russian open ground vegetable producers is also on the rise. The growth in this segment for the past year amounted to about 40%.
In the future, Turkey may achieve volumes comparable to those reached in the past, but it will take time and not for all products simultaneously. For their part, retail chains also need time to renew the contracts, further stretching the process.
By and large, Turkey does not have some kind of unique supply that Russia couldn't find somewhere else. The market ensures that, if you cut the trade ties with Turkey, the products will arrive from other countries. In principle, the restriction or opening of the Turkish market should not have a big impact on the availability of fruits and vegetables on Russian shelves.
Source: rueconomics.ru
