July 6, 2012

Russia cuts funding to local poultry industry

Russia's Ministry of Finance has decided to reduce agriculture funding as falling international oil prices have caused serious budgetary concerns in the country.

Total farmer support will be reduced from US$ 83.2 billion to 1.4 trillion to US$46.6 billion over 2013-2020.

As a result, the poultry industry financing program for the same period will decline by more than half - from US$ 8.34 billion to US$3.2 billion.

Government representatives reported that the country will be forced to abandon the direct subsidies for the development of poultry production enterprises, as well as regional support programs for poultry producers. Many experts predict that such a step will make Russia's poultry meat industry uncompetitive, leading to a rapid increase in poultry imports.

"Due to the new investors, as well as various innovations, Russian manufacturers expected to increase the daily growth of birds to 60 grams, to reduce feed conversion to 1.6, and increase egg production to 325 units a year per one layer. With such a sharp reduction in funding, we can forget about it," said a member of the Russian Union of Poultry Farmers (Rosptitssoyuz).

Investments in 2012 in the poultry industry will already be reduced from US$289 million to US$144 million. The government meets on July 10 to set the agricultural budget for 2013-2020.