Chicken is not released from Belarus – Newspaper Kommersant No. 187 (7388) of 10/10/2022

The authorities of Belarus, trying to keep domestic food prices, have introduced restrictions for seven large producers of the meat and dairy sector of the republic on exporting products abroad. They are temporarily prohibited from exporting chicken meat, table eggs, dairy products to Russia. Experts are sure that this only plays into the hands of Russian companies that are faced with overproduction.

At the disposal of Kommersant was a letter dated October 5, in which the Department of Veterinary and Food Supervision of the Ministry of Agriculture and Food of Belarus notifies of the suspension of the issuance of veterinary export certificates for a number of local producers of the meat and dairy sector. The regulator justifies this by the need to saturate the domestic market with products. The export ban coincided with a freeze on food prices in the republic since October 5, says Andrey Dalnov, head of the Center for Industry Expertise of the Russian Agricultural Bank.

The products of Servolux Agro (Petrukha brand), Vitebsk Broiler Poultry Farm (Ganna brand), Druzhba Poultry Farm, Baranovichi Poultry Farm (produces eggs under the Zlatko brand) and the 1st Minsk Poultry Farm (trademark “Notables”). Among producers of dairy products, the export ban affected the Rogachev and Lepel plants. All these companies are temporarily banned from exporting products, including to Russia, says a Kommersant source in the industry.

The ministries of agriculture of Belarus and Russia, as well as companies from the department’s list, did not respond to Kommersant’s requests. From the response of the Rosselkhoznadzor to Kommersant, it follows that the Russian side has not yet received official notifications from the Belarusian regulator about a ban on the export of meat and dairy products from the republic to the Russian Federation.

Belarus imports 120-140 thousand tons of poultry meat to the Russian Federation per year, a Kommersant source explains. According to his calculations, taking into account the export ban, the volume of deliveries to the Russian market from the republic may be reduced by 30 thousand tons by the end of 2022. “The falling volume is significant, which will provoke an increase in prices,” says the interlocutor of Kommersant. He does not undertake to predict the rate of a possible rise in price.

At the same time, another Kommersant source from poultry producers says that after leaving the market for small volumes of table eggs from Belarus, Russian companies will be able to replace the falling batches of this product. If there is a rise in prices, then within a few percent, the interlocutor of Kommersant believes. But, according to him, this will allow Russian companies to win back the losses they incur due to the growth of supply in the market and high competition.

According to the head of Streda Consulting Alexei Gruzdev, dairy plants in Belarus, whose products are subject to an export ban, mainly produce dry whole milk and condensed milk, and 70% is sent abroad. But for these types of products, Russian processors have just accumulated excess stocks in warehouses, so that they will be able to completely replace the falling volumes of Belarusian enterprises, the expert believes. He is also sure that the situation should not affect prices in the Russian Federation, as the competition in the country in the dairy market is high. Soyuzmoloko CEO Artem Belov does not expect a rise in prices for dairy products in Russia either: “Last year’s increase in production costs has been almost fully won back by producers, retail sales have stabilized, and even promotions in retail have begun to return.”

Some retail chains reported that they have not yet received notifications from counterparties about possible failures in the supply of Belarusian meat and dairy products. One of the retailers told Kommersant that in Moscow stores, for example, the share of the Petrukha brand does not exceed 3%. In X5 Group, Lenta, Magnit, Auchan did not answer Kommersant’s questions.

Andrey Dalnov says that the Russian food market is oversaturated with products of animal origin. Now, for example, in the domestic pork market there is a seasonal decline in prices and the decision of the Belarusian side, according to the expert, is unlikely to reverse this trend.

Alexey Polukhin