Sanctions spur growth in Russian agriculture

org_sszg221shAccording to the Financial Times – sanctions spur growth in Russian #agriculture. Ban on western food imports presents huge opportunity for domestic farmers as consumers turn to homegrown produce.
In the cold waters of the Barents Sea, Russian Aquaculture, the country’s largest salmon producer, has increased production more than sixfold so far this year, the result of a boom in the country’s food and agriculture industry caused by restrictions on western imports.
Around Russia, farms fields, greenhouses and fertilizer factories are thriving as consumers turn to domestically-produced food, helped by the worst relations between Moscow and the west for the generation.
“Russian agriculture is booming,” says Andrei Guryev, chief executive of Phosagro, a major Russian fertilizer company, “[And} we certainly see a lot of interest from foreign investors”.
Nikolay Kovalev, a research analyst at VTB Capital, says that food and agriculture companies in Russia spent $5bn in capital expenditure in 2016 and, in the past few years, local producers have had the chance to win market share “particularly in fruit, vegetables, cheese, milk, and meet categories”.
Shares in #Rusagro, #Phosagro, and meat producer #Cherkizovo have more than doubled since 2014. Russian Agriculture’s have quadrupled.
To sum it up:
6x – Increase in production so far this year at Russian Aquaculture, the country’s largest salmon producer;
16% – Rise in sales last year at Rusagro, the country’s largest agriculture company;
80% – Boost in wheat production last year at Steppe;
€390m – Money earmarked for greenhouses by #Renova, the investment group’s first foray into agriculture;
130m – Tonnes of grain Russia (#ProZerno) is forecast to produce this year, surpassing the record achieved in 1978 by the Soviet Union;
35% – Discount Russian agriculture companies trade at compared with peers in other developed and emerging markets.
Resource: Financial Times, September 2017

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