May 25, 2021
 

Cherkizovo CEO highlights importance of export for Russian agriculture

Cherkizovo Group recently took part in a meeting of the Agricultural Commission of the Russian Union of Industrialists and Entrepreneurs (RSPP) to discuss the current state and future expansion of agricultural exports.

In his opening remarks, Sergey Mikhailov, chief executive officer of Cherkizovo Group, a member of the RSPP management board and co-chair of the Agricultural Commission, stressed the importance of export growth for the progressive development of Russia's agricultural industry and overall economic growth.

He pointed out the untapped growth potential for agricultural exports, which can be realised by leveraging the best global practices and effective cooperation between the government and business community. To that end, he believes that companies from different agricultural industries should get together to work out comprehensive solutions addressing the targets and priorities of all key market players, the government and consumers.

According to Mikhailov, export growth should help improve the sector's profitability, while also driving capacity upgrades and sustainable development of rural regions, without jeopardising the interests of Russian consumers. He also believes that export regulation should not be a barrier to global expansion for exporters of certain agricultural products, enabling the diversification of their supplies. In his opinion, various social support initiatives may be instrumental in boosting domestic consumption of agricultural products.

Dmitry Krasnov, head of the Federal Center Agroexport, noted that despite COVID-19-related challenges, Russia's agricultural exports added 19% in 2020 and for the first time exceeded food imports, having surpassed US$30 billion.

According to Krasnov, early estimates for 2021 show a continued positive trend: by mid-May, exports of agricultural products have reached nearly US$10.9 billion compared to US$9.94 billion in mid-May 2019.

Yuri Kovalev, director general of the National Union of Swine Breeders, spoke about the strategic importance of exports for the development of the Russian pork production industry. He highlighted that last year, Russia had a strong position among the top 10 pork exporters worldwide and further improved its self-sufficiency in pork, which totalled 105% in 2020.

As the domestic market becomes more saturated, export expansion to sizeable foreign markets, primarily in the Asia-Pacific region, becomes particularly important, said Kovalev.

Sergey Lakhtyukhov, director general of the National Union of Poultry Farmers, talked about key poultry export destinations, as well as structural changes and challenges awaiting poultry exports in 2021. Commenting on the diversification of Russian exports, he noted that a 2% decline in exports to China was virtually offset by a 7% growth in sales to Africa. Lakhtyukhov believes that higher sales to new fast-growing markets may strengthen resilience of Russian exports amid the high level of uncertainty in the global economy, while also having a favourable effect on domestic production.

The meeting participants also supported a proposal by the Russian Ministry of Agriculture to foster a strong export-oriented agricultural sector with a view to boost annual agricultural exports to US$34 billion by 2024.

- Cherkizovo