While Moscow suspends the export of cereals until July 1st, the organic sector continues to produce and continues to honor contracts. Why the pandemic does not affect Russian agriculture and how would drought and a strong ruble affect it? The head of the largest Russian consulting company in organic farming explains
The Covid-19 pandemic has already had multiple consequences that have affected almost all areas of production. A few days ago, Russia suspended the export of cereals for at least two months, imposing a quota of seven million tonnes which has already been reached.
But the Russian organic sector is doing very well, confirms Andrey Akulinin, the head of Organic Certification, the largest consulting company in Russia in the field of international organic standards, who says that “there is not really consequences”.
“The crops most in demand on the international market for five years, those which cannot be cultivated on limited land in Europe, are peas, flax, rapeseed. These cultivated species are not part of the quotas imposed by the Russian government. Because what is most in demand on the international organic market does not matter for the Russian internal market, so Russia does not see any danger in the export of these organic crops.”
Empty warehouses for organic crops in Europe
Russia, in recent years, is in the process of gaining a place on the organic market but it is not one of the main players. Before the pandemic, Russia set a target of 260 million euros in exports by 2025. The current situation and the inevitable economic crisis will undoubtedly change the plans of the Russians, but for the moment the situation is stable. This is not the case for Europe, which could be in shortage if its largest exporters, Turkey and Ukraine, suspended their deliveries to the EU.
But the Russian organic sector is doing very well, confirms Andrey Akulinine, the head of Organic Certification, the largest consulting company in Russia in the field of international organic standards, who says that “there is not really consequences”.
“The latest figures date from 2018 and at that time the European Union imported into its territory 1,300,000 tonnes of organic crops, mainly from Turkey and Ukraine, Russia’s share is 34,000 tonnes, which makes less than 1%. So the empty warehouses of organic crops in Europe it is not because of Russia, for the moment no contract has been terminated due to the pandemic, they are all being executed.”
The main danger for the organic sector is not the pandemic
At the start of the containment, Russian agricultural enterprises did not stop working. To date, production continues and organic export is not suspended but, if the pandemic does not directly affect this sector, there are other factors that could turn the situation into disaster, admits Andrey Akulinin.
“The volume of production in Russia this year will depend mainly on the expected drought. Currently, in the Tomsk region, for example, we were experiencing record temperatures for the month of April. To date, the main danger for organic producers in Russia is the poor harvest due to the dry soil at the planting stage and not the pandemic. For organic exporters, provided a good harvest, this year will be even better than the previous one.”
The weak ruble makes exports more attractive
Russia has 40 million hectares of land suitable for organic farming, compared to 60 million in the rest of the world, which gives great hope for the organic future of the country, but the Russians are only at the beginning of this way of making all these resources profitable and developed.
Currently, with almost 34,000 tonnes of organic crops exported, Russia plays a lot on the weakness of the ruble, which makes exporting to the EU attractive. If that changes, the consequences would be devastating for Russia, said the head of Organic Certification.