November 24, 2010

Russia has excessive spring crops due to less poultry
 
 

The Russian government will halve the quota on poultry imports for the following year and wants farmers to sow 25% more spring crops to meet the demand after a severe drought this past summer, First Deputy Prime Minister, Viktor Zubkov, said.

The poultry quota will fall to 350,000 tonnes, despite earlier plans to set it at 600,000 tons, Zubkov said, adding that the new volume of imports would be enough to meet the demand. The US is Russia's largest foreign poultry supplier.

Russia has been steadily reducing the import quota in a bid to protect the rising domestic output of chicken meat, although imports tended to come in at a lower price.

Andrei Lisitsyn, director of the Gorbatov Meat Research Institute, did not find the sharp reduction in poultry imports alarming.

"We have a surplus of poultry," he said.

Poultry production rose 13% in the first nine months of the year, bringing total output to 2.9 million tonnes, Meat Union president, Musheg Mamikonyan, said last week.

Beef and pork production is also rising gradually, Lisitsyn noted. Zubkov said on Tuesday (Nov 23) that import quotas for these types of meat would stay the same next year, measuring 472,000 tonnes for pork, 530,000 tonnes for frozen beef and 30,000 tonnes for chilled beef.

Summing up the winter sowing season, the deputy prime minister noted that the area sown was 20% less than last year because winter sowing got off to a late start this year after being held back by the worst drought in at least a half century. To make up for the setback and meet the demand, the government wants spring sowing to cover 25% more land than this year, he said.

A recent poll by Zerno Online, an industry information portal, showed that 70% of respondents were unwilling to increase their spring sowing. According to the analyst, the hindrance was psychological.

"They do not have enough faith in state support," Vasilyev said. "It sounds pretty on TV, but you face real chaos in the implementation."

Among factors undermining confidence, he mentioned corruption in the distribution of government aid money.

Zubkov announced Tuesday that agriculture would receive another RUB500 million (US$15.9 million) in credit and aid at the beginning of next month. The state provided RUB667 million (US$21.3 million) for agriculture in September and October.

Also, much of the fuel supplied under subsidies is either of poor quality or its price is artificially inflated before the discount is applied.

In addition, the ban on grain exports which is running till July 1 next year has a negative effect on production, he said.

"Export is a strong stimulus," Vasilyev said. "With all these uncertainties, no one has decided what they want to do."