Putin strikes back - extent to which policy decisions can confuse 2014/15 the international agricultural market?
The Russian Prime Minister has signed a law that prevents the import of agricultural products from all of the countries that participate in the Western sanctions against Russia. These include the United States and the EU, but also Australia, Canada and Japan at the forefront.
However the actual form of the prohibitions with respect to quantity, quality, and time has not been published yet. Is visible in outline which countries with which products in which possible extent be affected, however.
(1) the Russian import ban for EU pork is updated. This means 2013 approximately 750,000 t export loss per year according to recent figures. Export gains are in other countries, which can be estimated according to conservative estimates to 230,000 tonnes. 2014 collapsed the pork export to 82% in the first 5 months. The import ban is not new, months-long experiences exist already. The EU offer on pigs is however declining. The continuation of the Russian import stop prevents high pork prices above €1.70 / kg. Falling food prices again catch a part of the reduced revenues. Also the United States and Canada are affected by the block, but without great effect because the PEDv location and the use of Ractopamine.
(2) Russia imported about 1 million tons of beef from the major exporting countries of South America, Australia and other countries. The EU exports have fallen 2013 to nearly 75,000 t. Russia accounted for 16% of EU beef exports. In the first 5 months 2014 Russian beef imports from the EU has to + 64% increased. The deletion of Australia from the Russian import list is can be compensated by Chinese import increases of Australian beef.
(3) Russia is one of the largest importers of dairy products after China and Japan. Especially cheese, butter and SMP standing in front. The EU share amounts to 33% for individual products. A Russian import lock could also depress currently considerably growing EU market after the recent price declines. To what extent the recent Melaminskandal in Chinese yoghurt batches triggers a renewed surge in imports, is not manageable. German products enjoy a good reputation in China.
(4) despite the large production increases Russia relies on the import of poultry meat . Approximately 200,000 tonnes per year or 8% of the U.S. exports come from the United States. The current (red) meat shortage in the United States may well cope with such an amount. EU exports to Russia are with 100,000 tons or 7% of manageable importance, especially since in recent years imports have dropped off Brazil is the great hope for Russian beef, pork and poultry meat imports. Already, new import licenses were given to 5 Brazilian meat suppliers that were stripped in previous years because of the suspicion of foot - and -mouth disease. However Brazil's production capacity is insufficient to compensate for the loss of imports even remotely.
Remains still the speculation on the large Russian grain exports. Will Russia allow reasons increasingly necessary domestic production of less exports? Potential importing countries as a result of political unpredictability of Russia in terms of trade in grain to other export countries are dodging?
And then there is Argentina: the national bankruptcy requires a new financing. The Argentine budget was financed in previous years up to 40% of the export taxes on agricultural products. Argentine farmers have fought back with an Exportboykott with rising prices, however. In the current situation of falling agricultural prices, Government tried to counteract with deletion of export licenses. Argentina is one of the largest exporters of maize, soya and wheat. Must the trade estimates for the be readjusted next month?
