Dmitry Krasnov: Russia exported organic products worth 30 million US dollars in 2019

According to the speaker, the USA and the EU are among the largest buyers of domestic organic products, whose share of total organic exports in 2019 in physical terms was 56% and 40%, respectively.

Russia supplies only two crops - soybeans and peas - to the USA, peas - to the EU, 50% of the total volume, wheat, 26%, rapeseed, 8% and a number of other products.

‘Russia has a significant potential for the growth of production and export of organic products,’ said the head. ‘From 2014 to 2019, the annual growth rate of organic land in Russia was 22%. If we maintain this dynamic, by 2030 we will be able to enter the top five countries in terms of the area of organic land. At the same time, it should be borne in mind that 98% of the organic land in our country is arable land, the shortage of which is particularly acute in the world.’

According to the above statistics, the main area of organic land in Russia is used for growing cereals - 36% of the total volume, legumes - 24% and oilseeds - 17%. The most popular crops are wheat, sunflower, corn, soy, peas, barley and rapeseed.

For 57% of Russian organic producers, the main activity is crop production, for 14% - animal husbandry, of which half is also engaged in crop production. 12% of companies are engaged in collecting wild plants, 17% of companies are engaged in processing.

‘Due to its potential, Russia can also supply processed products to China, unlike Europe and the United States,’ the expert said. ‘The export of milk and whey powder can become a rather promising direction. The Chinese dairy market is relatively young, it wants to consume products similar to European ones, but it cannot provide for itself yet. In this regard, the ingredients are imported. However, the Chinese prefer to control the production from which dairy products are imported. Over the past 10 years, Chinese milk producers and processors have bought out shares in large dairy farms and cooperatives in New Zealand and Australia - Westland, Synlait.

The speaker believes that Russia has the opportunity to increase exports of almost all types of organic products produced significantly. Based on the growing needs of the markets and the opportunities of Russia, the total volume of organic exports can reach 2-4 billion US dollars by 2030.

‘To do this, we need to have 3-5 million hectares of certified organic land, in 2019 their area was 0.7 million hectares,’ the head explained. ‘Such an area will allow both ensuring domestic consumption and significantly increasing exports.

The expert also spoke about the measures being developed to support organic producers, among which there may be compensation for certification costs, technical support and training of personnel for organic agriculture, improvement of the regulatory framework.

According to the speaker, one of the important areas for the development of organic exports is the development of transport infrastructure. So, to date, the only seaport in Russia certified in accordance with the requirements of the EU organic regulations is the St. Petersburg Port Terminal, which limits the possibility of transporting products from regions remote from St. Petersburg.

‘It is necessary to remove tariff and non-tariff barriers,’ said the head. ‘For example, the requirements for the regionalization of grain crops from the PRC restrict the export of both ordinary and organic grain. In terms of promotion, it is necessary to form an idea among foreign consumers about Russia as the country of origin of organic products. This can be facilitated by the status of a country without GMOs and the existing perception of Russian goods, for example, in China, as more environmentally friendly.

After analyzing the global organic market, the Head noted that it is growing at a faster pace than food consumption in general. Therefore, Russia can take a significant share, especially since ‘large profitability in organic farming contributes to the growth of areas.’

However, according to the expert, there are problems in Russia that hinder the development of the industry. To solve them, the participation of the state is necessary.

‘Despite the existing difficulties, we can expect that the organic industry will contribute to increasing the export of agricultural products in the coming years,’ the speaker concluded. ‘The existing dynamics of the development of organic agriculture allows us to make such a forecast.’

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