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ISSN : 1225-8504(Print)
ISSN : 2287-8165(Online)
Journal of the Korean Society of International Agricultue Vol.24 No.5 pp.579-590
DOI : https://doi.org/10.12719/KSIA.2012.24.5.579

러시아의 축산업 현황과 발전 전망(2012-2014)

이상덕, 듀라에바히롤라
국립축산과학원 기술지원과

Russian Livestock and Products Development Forecast for 2012-2014

Sang Duk Lee, Djuraeva Hilola
National Institute of Animal Science, RDA

Abstract

The report demonstrated an overview macroeconomic assumptions specific productionforecasts on meat, poultry, and dairy production of the Ministry of Economic Development of RussianFederation. The Forecast is based on the statistics of Russia's social and economic development anddevelopment forecasts of Russia's federal and local government bodies and the Central Bank of Russia.The Forecast does not make it clear if the impact of Russia's accession to the World Trade Organization(WTO) was taken into account in the MED calculations of the outlook for 2012-2014. Agricultural establishmentsincreased output by 9.4% as a result of continued state-support for the construction of newfacilities and modernization of existing facilities. Increased live swine and pork imports in 2012 as comparedto the previous estimate reflect better market access related to both better TRQs and future sanitarycommitments per Russia's WTO accession.

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Russia is the largest consumer market in Central and Eastern Europe and one of the world's largest importers of food. The food processing industry is a relatively strong sector in Russia. The industry includes more than 30 sectors, bringing together 43,000 active organizations which employ about 1.3 million people. The following product sectors are considered socially important: meat, dairy, sugar, baking, oil, milling and salt. The share of these food products in retail turnover is 48.9% or 8 billion Rubles.

 Russian Government issued resolution 559R on April 17, 2012 which approved the Strategy for Development of the Russian Food Industry until 2020. The strategy is aimed at modernizing food processing production facilities and increasing their capacity through innovation and technologies. As a result, the industry would be able to manufacture more competitive products, decrease power consumption and be more environmentally friendly. The strategy is aimed at increasing production of flour, grains, bakery products, sugar, dairy products, butter, cheese and cheese products, fruit and vegetable preserves, oil, confectionary products, fish and fish preserves. In addition, the strategy aims to develop infrastructure and logistics for the food products distribution system. The document contains production targets for 2020, confirms the need to modernize the industry, and estimates necessary investments in the amount of 777.8 billion Rubles (USD 26 billion) in order to reach the targets.

 Russia is one of the world's leading importers of food, partly because of its arid climate, inconsistent rainfall. According to MED1) foresees rapid import growth and a consistent reduction in the trade balance. Based on the estimated dynamics and structure of imports to Russia and its CU partners, Russia's average weighted rate of import tariff, taking into account concessions and preferences, is expected to decrease gradually from 9.64 per cent in 2011, to 9.5 per cent in 2012, 9.33 per cent in 2013 and 9.15 per cent in 2014. MED also expects that in case of WTO accession, Russia’s average weighted import tariff will decrease an additional 0.8 percentage points from the first of year of the new tariff's implementation.

1)MED : Ministry of Economic Development. MED develops such forecasts every year as part of the Russian government's process of developing its three-year federal budgets, thus Russia's budget is based on the MED forecast data.

THE PRESENT SITUATION OF LIVESTOCK

 According to the Russia's State Statistical Service (Rosstat), producers of all types produced about 5.3 MMT of poultry and livestock for slaughter (live weight) in January-July 2011 which is 3.9% more than in January-July 2010 (107.4% 2010/2009). Agricultural enterprises increased production by 7.4% during the same period. The Russian Ministry of Agriculture (MinAg) reported in the middle of July 2011 that Russia will increase production of livestock-origin products by 2.8% in 2011(Table 1).

Table 1. Russia: Poultry and livestock production, live weight, by farm types. (Unit : 1,000 MT)

Cattle & Beef: production and trade

 Cattle inventories ended 2011 surprisingly higher than expected after a dismal 2010. According to Russia's state statistical service (Rosstat), beef production decreased 5.3% to 3.053.1 MMT live weight in 2011 from 2.891.2 MMT live weight in 2010. Beef production continues to be a byproduct of the Russian dairy industry's profitability. Better than expected year-end cattle inventories resulted from significantly less kills and thus less beef production in 2011. For 2012, FAS/Moscow expects inventory and production to return to the long-term downward trend line.

 By the beginning of 2012, cow inventories will shrink by 2.0% as feed costs will remain problematic through at least the 2011 harvest (Table 2). By the end of March 2011, cow inventories decreased 1.6% compared to 2011 to 8.9 million head after cattle slaughter rates increased in 2010 as a result of the drought which sharply decreased feed supplies. Feed availability per cow-equivalent unit was 30% lower by the end of March 2011 compared to the same period of 2010. Dairy cow stocks fell 2.8% in 2010.

Table 2. Russia: Cattle inventories. (Unit : Million Head)

Table 3. Russia: Cattle numbers. (Unit : 1,000 Head)

Table 4. Russia: Beef and veal production, supply and distribution.

 Beef imports in 2011 from non-Customs Union partners decreased 3.5% by volume (11.2% by value) to 605,000 MT (847,000 MT CWE) (Table 5). Brazil's export capacity was reduced a small extent by Russian restrictions on its processing facilities. While remaining the dominant supplier, in total, imports from Brazil were again lower in 2011, totaling 224,000 MT. Uruguay, Paraguay, and Argentina also reduced supply. Supplies increased from the European Union, Australia, the United States, and Mexico. Increased U.S. sales were in response to an increased TRQ allocation as compared to 2010. Imports into Russia's Special Economic Zones of Kaliningrad and Magadan fell in total by 11,000 MT. Also, TRQ-exempt beef from Ukraine totaled 12,000 MT. Rosstat reported Belarus exported Russia 21.6% less beef by volume and 5.8% more by value 98,200 MT and $491,100 respectively.

Table 5. Russia: Beef imports (HS-0201, 0202, 0210.20, 1602.50) by top partner countries.

Table 6. Russia: Beef imports by type.

Swine & Pork: production and trade

 FAS/Moscow has lowered its expectation of 2012 swine inventory growth to 1.0% on some producers' less bullish outlook following WTO accession. A lower estimate for 2012 ending inventory of 17,500 head also reflects lower than expected ending inventories in 2011, which grew only 0.6% on the year.

Table 7. Russia: Swine numbers. (Unit : 1,000 Head)

 Pork production in 2012 is expected to increase on slightly better than anticipated results in 2011. According to the Rosstat, live-weight pork production increased 3.6% in 2011 over 2010 (Table 8). While production continues to grow, it simultaneously remains held back by African Swine Fever, especially among vulnerable private households and increasingly out-dated agricultural enterprises. The Ministry of Agriculture estimates slaughter-weight2) pork production will increase 100,000 MT (or 4.4%) to 2.4 MMT in 2012 over 2011. RUSB (Russian Union of Swine Breeders) forecasts that Russia will increase pork production by 8.2% to reach 2.6 MMT in slaughter weight in 2012 and 7.8% in 2013.

2)Accordin to Rosstat methodology (www.gks.ru), slaughter weight is the weight of the carcass, including raw fat and offal of categories I and II used for food (tongue, liver, kidney, heart, udder, iris, etc.). Slaughter yield coefficients vary from 49% in sheep and goats; 58% on average for cattle, up to 77% for pigs, and about 80% for poultry. To calculate livestock and poultry production for slaughter output coefficient of meat, fat and offal weight are used, established on the basis of data provided by the processing organizations in the form of federal state statistical observation. Information on these groups of animals for agricultural producers exists but is not publicly available. 

Table 8. Russia: Pork production, supply and distribution. (Unit : 1,000 MT CWE)

 The largest concern of the domestic swine industry regarding WTO accession is potentially resurgent import levels of live hogs from Europe after the tariff falls from 40% back to 5% in mid-2012. The tariff was last at 5% in 2009 when Russia imported 1.2 million head. Russia is considering renegotiating a higher tariff immediately upon joining the WTO in anticipation of increased imports in the second half of 2012. Russia has also suggested it will be prepared to use the WTO safeguard mechanism to protect against import surges.

Table 9. Russia: Swine imports by type.

Table 10. Russia: Pork imports by type.

 In 2011, pork imports from non-Customs Union partners increased 3.7% by volume (11.5% by value) to reach682,000 MT (Table 11) (886,000 MT CWE). The European Union remained the largest supplier and increased trade 47,000 MT. Simultaneously, 2011 was a tumultuous year for Brazil as Russia maintained a near ban on Brazilian pork, ultimately reducing pork sourced from Brazil by 91,000 MT. Canada did well to pick up the lost Brazilian sales, increasing sales from 67,000 MT in 2010 to 112,000 MT in 2011. The remaining gap also allowed Chile to increase trade. Limited by a country-specific TRQ allocation, U.S. sales were constant at just under 60,000 MT. Non-quota pork from Ukraine appeared from nowhere to reach 13,000 MT. Belarus reports pork exports to Russia totaled $187 million in 2011, indicating Belarusian pork exports far exceeded agreed levels. [Note: According to market experts, Belarus was on target to export 270,000 MT of meat and poultry to Russia in 2012 10,000 MT more compared to 2011].

Table 11. Russia: Pork imports (HS-0203, 0210.11-19, 1602.41-49) by top partner countries.

 In 2011, Russia reported exports of raw pork from the regions of Kransnodar, Kamchatka, and Murmansk as well as the city of Moscow. The pork was destined for the disputed Georgian territory of Abkhazia, Panama, Belize, and Norway. Russia also reported exports of live swine from the Stavropol region to Georgia and from an undisclosed region to Mongolia. Russian exports of pork and live swine to its Customs Union partners of Belarus and Kazakhstan are not reported.

Dairy Product & Poultry: production and trade

 The Russian dairy production has demonstrated a betterthan-expected start to 2012, increasing production as prices continue to show resiliency to the onset of seasonally higher production. A higher revised 2012 milk production increased by 279,000 tons, forecast reflects 4.5% stronger milk production in the first quarter of 2012 compared to the previous year.

Table 12. Russia: Production of dairy product. (Unit : 1,000 MT)

 Cheese production decreased to 425,359 MT in 2011 as processors began to face high milk prices and appeared to favor butter, cream, and milk powder production. The primary foreign suppliers were the EU (52%), Belarus (26%), and Ukraine (20%).

Table 13. Russia: Imports of cheese (040620, 040630, 040640, 040690).

 Through April 2012, production of cheese and cheese products was 6.0% higher while imports of all cheeses (including cottage cheese) was 2.1% lower, compared to January-April 2011.

 Butter production increased to 216,273 MT in 2011. The primary foreign suppliers were Belarus (36%), New Zealand (27%), and the EU (24%).

Table 14. Russia: Imports of butter (040510, 040590).

 Through April 2012, production of butter was 6.8% higher while imports were 22.8% lower, compared to January-April 2011. Butter prices remain steady, near the highs set at the end of 2011.

Table 15. Russia: Imports of butter (040510, 040590).

 In 2011, production of whole milk powder reached 49,863 MT, including 9,230 MT with 2-18% fat and 40,633 MT with 20% fat, and skim milk powder production reached 56,549 MT. Belarus held the dominant position in market share at 74% for WMP and 62% for NFDM, followed by the EU at 14% and 27%, respectively.

Table 16. Russia: Imports of dairy products. (Unit : 1,000 MT)

 Through April 2012, production of granulated milk powder was 22.0% higher while imports of concentrated milk and milk powder were 12.4% lower, compared to January-April 2011.

 Russia’s broiler production is projected slightly lower than the previous estimate for 2012 but still 6% higher than 2011. The 2011 production estimate has been adjusted slightly upwards to reflect preliminary year-end data and another strong second half for Russian poultry production. Production remains supported by domestic support and high, albeit stable producer prices. Earlier production prospects have been limited as a result of supply pressures that have been brought about by WTO market access commitments and Russia’s openness to import unlimited quantities of Belarus poultry.

Table 17. Russia: Broiler production, supply and demand, (ready-to-cook). (Unit : 1,000 MT)

 Russia has been one of the major world importers in recent years of meat and poultry products. Imports have accounted for roughly 30% of pork consumption, and roughly 40% of both poultry and beef/veal. Some analysts conclude that this domestic situation underlies Russian actions that periodically have constrained the country's imports of poultry and meat products. FAS/Moscow reversed the direction of the 2012 import forecast based on improved market access for poultry, which is now more favorable than in 2011.

Table 18. Russia: Imports of broiler meat (020711-14, 160232). (Unit : MT)

 Russia’s broiler meat exports remain virtually nonexistent outside the Russia-Belarus-Kazakhstan Customs Union despite continued statements from senior cabinet officials that Russia will offer 200,000-250,000 MT for export in 2012.

Table 19. Imports of poultry meat. (Unit : 1,000 MT)

Table 20. Russia: Exports of Frozen Chicken Cuts/Edible Offal, Including Paws (020714). (Unit : MT)

Tariffs-rate Quotas

 In total, the 2012 poultry TRQ will increase to 364,000 MT, as compared to 350,000 in 2011. After competing without country-specific quotas in 2011, 2012 presents new TRQs divisions among poultry products (Table 21). Through October 2011, the United States and Brazil represented 86% and 12% of the trade that makes up the newly established 250,000 MT broiler bone-in meat TRQ in 2012. At the same time, the European Union, Brazil, and the United States represented 44%, 35%, and 16% of the trade that makes up the newly established broiler boneless meat TRQ, which is 250,000 MT in 2012. However, in 2012 and after WTO accession, 80% of this TRQ will be reserved for the European Union. In total, it is currently set at 70,000 MT, and it will increase to 100,000 MT upon WTO accession.

Table 21. Russia: Poultry tariff-rate quotas in 2012. 3)HS-0207.14.200 (bone-in halves and quarters), 0207.14.600 (bone-in legs and cuts thereof). 4)HS-0207.14.100 (boneless cuts). 5) HS-0207.27.100.1 (frozen boneless turkey cuts). 6)HS-0207.27.100.0 (boneless), 0207.300.0 (frozen whole wings), 0207.400.0 (backs, necks, rumps, wingtips), 0207.600.0 (drumsticks and cuts thereof), 0207.700.0(other legs and cuts thereof). 7)HS-0207, not otherwise covered.

 Meat imports remain highly regulated by tariff-rate quotas (TRQs) for suppliers outside the Commonwealth of Independent States. GOR Resolution 616, signed July 27, 2011, maintains TRQ quantities for chilled beef (30,000 MT) and frozen beef (530,000 MT) but sets new marks for pork (320,000 MT) and pork trimmings (30,000 MT), representing a 150,000-MT reduction from 2011 (Table 22). FAS/Moscow has confirmed with Russia's Ministry of Economic Development that the GOR has no current plans to issue country-specific allocations in 2012. However, Russia's World Trade Organization accession talks are ongoing and could result in changes for 2012 before the end of the year.

Table 22. Russia: 2012 TRQ quantities. (Unit : 1,000 MT)

LIVESTOCK DEVELOPMENT FORECAST FOR 2012-2014

 According to the Forecast, socioeconomic policies of the government of the Russian Federation in the medium term (2012-2014) are characterized as transitional in connection with completion of the post-crisis recovery and further increased focus on strategic measures set forth in Strategy-2020.8) In the coming years, along with its work towards fiscal consolidation, Russia will need to lay the groundwork for furthering its longer term interests, such as establishing a modern and innovation-based economy, integrated into the global economy.

Animal products

 In the medium term, MED expects animal products to have slight majority in the structure of Russia's agricultural production with a share of 52%. Production of animal products is projected to grow by 10% in 2014 over 2010. MED believes that a significant price increase is unlikely given some global overproduction of certain animal products (poultry, milk) in 2012. The Ministry forecasts that in 2013-2014 prices for animal products may start outpacing inflation rates due to an increase in demand (for red meat and high quality dairy products), and also because of the rise in price of feed, should grain prices rise. Besides, according to MED, the upward trend in the global prices for animal products may increase, particularly in case of continued growth of energy prices.

Meat and Poultry Production

 MED estimates that production of livestock and poultry for slaughter (in slaughter weight) should grow by 4.9% in 2011, mainly due to production of poultry and pork benefiting from an expected decline in imports and consumption growth.

 The Ministry states that in the future, given the saturation of Russia's meat market, insufficient infrastructure and existing problems with sales, production growth in key subsectors of livestock production will slow down. In particular, production of poultry and pork in 2014 over 2010 should grow by 33% and 21%, respectively (for comparison, poultry production increased 1.8 times in 2010 over 2006, and pork - 1.4 times), and imports in its supply in 2014 will account for 17.3% versus 25% in 2010, for poultry - 8.3% versus 18.2%. Despite the recovery of consumer demand and significant government support, production of cattle is estimated to decrease by 2.3% in 2014 over 2010. Thus, the share of cattle in the structure of livestock and poultry production should be redistributed in favor of pork and poultry.

Table 23. Meat and meat products supply and distribution. (Unit : MMT)

Dairy Production

 According to MED, in recent years, Russia's dairy sector was subject to a number of negative factors that affected its development, in particular, increased competition from imported dairy products. Milk production is expected to decrease by an estimated 1% in 2014 over 2010. Renewed growth in consumption of dairy products after the crisis coupled with a deficit of domestic production of raw materials in the medium term will determine the growth of imports, mainly from the CIS countries, which enjoy a free trade regime. The share of domestic dairy products in total supply will go down from 76% in 2010 to 74% in 2014. Per capita consumption will increase from 245 kg in 2010 to 249-250 kg in 2014.

Table 24. Milk and dairy products supply and distribution. (Unit : MMT)

 The situation on the world dairy market indicates that prices are not expected to decrease. However, despite the expected increase in prices on the global dairy market, imported goods will be cheaper than domestic product, and there will still be a gap between domestic prices and import prices of dairy products, which affects Russia's production of dairy products.

CONCLUSION

 The Russian dairy industry has demonstrated a betterthan-expected start to 2012, increasing production as prices continue to show resiliency to the onset of seasonally higher production. In addition to a favorable prices, output remains supported by slowing dairy herd contraction, new market access trade barriers, maintained levels of state support, higher per cow feed stocks, and improving milk yields and animal husbandry at agricultural enterprises. Nonetheless, Russia's dairy statistics as well as its support programs have recently come under increased scrutiny for gross inaccuracies and failure to reach production targets. The GOR is again entertaining new proposed support measures.

 Russia has been one of this year’s hottest markets for U.S. beef and pork in 2011. Coming off a record performance in 2011, beef and beef variety meat exports to Russia were up 24% in volume (71.2 million pounds) and 83% in value ($138.8 million) compared to January-May 2011. Though not on a record pace, pork exports to Russia have also been very strong -with exports of pork and pork variety meat outpacing last year by 35% in terms of both volume (86.3 million pounds) and value ($115 million). Prospects for further export growth to Russia have been bolstered by Russia's entry into the World Trade Organization (WTO). Though Russia's invitation to join the WTO became official in December 2011, in late July the Russian Parliament just recently passed the legislative package necessary to complete its accession to the WTO. This means that many of the trade commitments Russia agreed to as part of its WTO accession with take effect Aug. 23.

 Russia is the 12th largest global exporter in merchandise and 18th largest global importer, but in terms of trade with the EU, Russia is the EU's third largest source of imports (after China and US) and is the EU's fourth largest customer after US, China and Switzerland. However, the EU is Russia's biggest trading partner with over 50 per cent of imports into Russia coming from the EU and is the No1 destination for Russian export goods. Trade with Russia is therefore very important for the EU and its industries.

 Russia has chosen the path of scale modernization of food production with the use of resource-saving technologies, greening of the agricultural sector to the fullest potential breeding and genetic research, as well as the sustainable development of rural areas. A high level of security of the agricultural sector in natural resources as a strategic competitive advantage for Russia in the medium term. WTO membership for Russia gives all exporting countries more certain and predictable access to Russian markets, and Europe’s farmers and exporters will hope to benefit from this.

적 요

 러시아인의 주식이자 농업의 근간은 축산업이라고 할 수 있다. 특히 낙농업은 구소련 해체 후 사유화 과정에서 턱없이 부족한 기계와 자재 등 자본재 결여로 사양길에 접어드는 듯 했다. 지속적인 구조조정을 거쳐 이제는 제법 규모화 된 농장들이 생겨나고 가공시설의 현대화로 생산량이 부쩍 늘었다. 그러나 러시아는 새로운 시장 진출에 대한 높은 무역장벽, 각 주별 생산농가 지원 수준의 불균형, 새로운 기술도입 등에 대한 문제로 러시아가 해마다 정하는 목표를 달성하지는 못하고있다. 그 의미는 아직도 러시아가 축산에 대한 높은 생산성과 경쟁력을 갖추지 못하고 있다는 의미이다.

 러시아는 미국의 쇠고기, 돼지고기 수출에 있어서 가장 뜨거운 시장 중에 하나이다. 2011년 미국의 러시아 수출은 규모로 볼 때 71.2(백만)파운드 금액으로는 1억4천만 달러로 재작년에 비해 83% 증가 했다. 2012년에 러시아는 WTO 회원국으로서 농축산물에 대한 더 많은 교류가 전 세계적으로 확대될 예정이다. 그동안 빗장을 닫아 두었던 무역장벽을 스스로 허물면서 자본재 및 금융시장의 글로벌 전략을 택함으로 농축산 분야에 위기인가 기회인가는 러시아의 자구적인 노력에 달려 있음을 상기시키고 있다.

 러시아는 세계 12위 상품 수출국 이지만 18위 최대 수입국이기도하다. EU와의 무역에 있어서는 중국, 미국 다음으로 가장 큰 수입국이며 고객으로 간주 받고 있다. 러시아도 천연자원 및 중공업 생산물을 가장 팔기 쉬운 무역 파트너가 유럽이라는 것을 알고 서로간의 무역 교류 역사는 소련 시절로 거슬러 올라간다.

 구소련 붕괴 후 무너져 버린 농업 체제가 푸틴 정권 이후 제자리를 점차 찾아가면서 강한 러시아 기조를 유지하고 옛날의 패권을 찾으려 노력하는 러시아에게 수많은 농촌인구를 무시할 수 없는 중요한 이유가 있다. 이미 러시아도 지속가능한 농촌 및 농업 개발에 무게를 두면서 곡물 생산 증가 축산업 재건 및 고급화 등을 위해 정부 지원을 계속하고 있다.

Reference

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