Alexander Tkachev: Russia will reach the vegetable self-sufficiency in 5 years - The 3rd International Investment Forum and Exhibition "Greenhouse Complexes Russia 2018" The 3rd International Investment Forum and Exhibition “Greenhouse Complexes Russia 2018”

Alexander Tkachev: Russia will reach the vegetable self-sufficiency in 5 years

Russia needs 3 to 5 years to provide the market with domestic vegetables 90%, as announced by the Minister of Agriculture Alexander Tkachev during the Russia 24 channel interview. As reported by him, vegetable farming now is developing at a rapid pace, and has experienced a 30% growth over the last three years. “We need three to five years to cover 90% of the vegetable market ,” – as Tkachev predicts. “We will manage to completely bridge the deficit and produce vegetables domestically within 5-7 years”, — he added, emphasizing that Russia now imports 1,5 mtpa of vegetables.

At that, the output of vegetables in 2017 will maintain at the last year level as of 16−16,5m t. The Minister has given this estimate based on weather conditions. “We had a retarded spring, and a delayed vegetable planting. So the ripening stage has been suspended for 2 or 4 weeks. It has definitely affected the market: the price, logistics, etc. So we figure out that due to the regions with favourable weather conditions, we will get good indicators as of 16−16,5 million t”, — Tkachev estimated. As reported by Rosstat, the record-setting 16,3 million tons of vegetables were grown in 2016, which 1,1% exceeds the 2015 performance (16,1 mt) at the average yield as of 226 dt/ha. The area of greenhouses accounted for 3,15 k ha last year, which is 1,5% higher than a year before. Whereas the greenhouse area has grown up to 2,14 k ha, due to construction and modernisation of 160 ha of greenhouses, the area of spring greenhouses totals 0,91 k ha. As a result, gross yield of protected vegetables has reached 813,7 k t — almost 15% more than in 2015.

For the benefit of complete vegetable import substitution, Russia has to build around 2 k ha of greenhouse complexes more and new vegetable storages as of 3 m t, as Tkachev reminded. “I truly hope that we will be able to bridge a 2 m t deficit before 2020. And after 2020, approximately 1 m t will remain, and it is realistic”, — he noted. According to the Ministry of Agriculture, the overall fruit and vegetable storage capacity across the country is now estimated at 7 m t. Additional storage capacities will allow producers’ manoeuvring on the market, said the Minister, referring to the European practices. “The benefit of European countries consists in their long-standing attention to the storage infrastructure, particularly, vegetable and potato storages. It enables manoeuvring: if there is an excess of any product, it can be stored just until the price is adequate for it to enter the market. And on the other hand, as we have experienced this year: all products emerged the market, and we have nothing left”, — the Minister explained.

As reported by Rosstat, fruit and vegetables have gone up 8,3% in June, which has become the major drive of inflation rising higher than the target 4%. July featured vegetable price reduction by 8,3%, including green cabbage falling in price 34,5%, potato — 21,2%, beetroot, tomatoes, cucumbers, bananas and lemons — 8,3−15,2%. However, by estimates of the Central Bank, the fruit and vegetable price seasonality shift will affect the general inflation indicator at least till September.

As announced by the Chairman of the Central Bank Elvira Nabiullina, the early summer price surge is associated with the lack of storage infrastructure. Tkachev, in his turn, has noted that the prices will fall in case of gross yield growth. “We have to produce more for the price to stay at the adequately low level,” —Tkachev said.

Source: Agroinvestor