The earth was covered with “Steppe” – Newspaper Kommersant No. 67 (7512) dated 04/18/2023

Land assets in southern Russia continue to be of interest to investors due to their proximity to export markets and high yields. Thus, Steppe agricultural holding, which is part of AFK Sistema, bought out about 26 thousand hectares in the Stavropol Territory worth 2.9 billion rubles. The deal will allow the buyer, among other things, to increase its own grain exports in the face of a reduction in the work of global traders in the Russian Federation.

Agroholding Step, which is part of AFK Sistema, became the owner of LLC JV Gvardeets in the Stavropol Territory on April 14, follows from the data of the Unified State Register of Legal Entities. According to a Kommersant source in the market, this farm manages about 26 thousand hectares of land, which were valued at 2.9 billion rubles. Prior to this, the enterprise was owned by the local APK Vozrozhdenie LLC. In Steppe, Kommersant confirmed the fact of the deal, refusing to comment further. APK Vozrozhdenie did not answer questions.

“Steppe” grows grains, legumes, oilseeds, is engaged in milk production, gardening, food trade. Including RZ Agro controls 578 thousand hectares in the south of Russia, which corresponds to the sixth place among the largest owners of agricultural land according to BEFL. The revenue of “Steppe” in 2022 increased by 46.4%, to 83.7 billion rubles.

This is not the first time that Steppe has bought the assets of APK Vozrozhdenie. In 2020, the agricultural holding acquired the Vysotskoye and Chapaevskoye agricultural enterprises from the company, which included a dairy farm and about 28 thousand hectares of land. At that time, Steppe also sold the Yuzhny agricultural complex in Karachay-Cherkessia with a capacity of more than 40 thousand tons of tomatoes and cucumbers per year to the owners of the Vozrozhdenie agricultural complex.

The purchase of the Gvardeets joint venture may be one of the largest agricultural land transactions since the beginning of 2023. In January, it became known about the purchase of “Bio-Tone” by the head of the Union of Grain Exporters Eduard Zernin with 15.5 thousand hectares in the Stavropol Territory. And in April, Bio-Ton acquired about 10 thousand hectares in the Saratov region from the structures of the ex-president of the UMMC Iskandar Makhmudov (see Kommersant from January 9 and 11 April).

Based on the value of the transaction, the land of the joint venture Gvardeets was valued at approximately 111.5 thousand rubles. for 1 ha.

The director of Sovecon, Andrey Sizov, calls the price “not bad, given the high rainfall for the region, up to 600 mm per year.” According to him, agricultural land in the south of Russia is of the greatest interest to potential buyers, and the southern regions will be the last where a decrease in demand can be recorded. Director General of the Institute for Agricultural Market Studies Dmitry Rylko says that the agricultural sector of the south of the Russian Federation successfully combines proximity to export grain markets and high productivity of arable land, so the demand for agricultural land in these regions has been and remains high.

BEFL Managing Director Vladislav Novoselov notes that the climatic conditions of the Stavropol Territory allow growing a fairly wide range of crops; drying of the harvested crop is rarely required. The region is also provided with storage facilities and qualified personnel, which is especially important in recent years, he adds. According to Mr. Novoselov, there are many small and medium-sized players in the region, and BEFL is waiting for deals to enlarge them.

As Mr. Sizov points out, the development of grain exports, the profitability of which is very high, probably has a positive effect on Stepi’s business. According to Rusagrotrans on the Pole.RF portal, Russian wheat with 12.5% ​​protein for delivery in May-June costs $275 per ton FOB on average.

According to the results of the first eight months of the 2022/23 season, Steppe ranks seventh among the largest grain exporters with shipments of over 1 million tons, and also leads in the export of peas, controlling about 20% of exports of this crop from the country. The general director of Prozern, Vladimir Petrichenko, notes that the expansion of the land bank, respectively, will allow Steppe to increase shipments of its own grain and legumes. In addition, Cargill, Viterra and Louis Dreyfus plan to stop exporting Russian grain next season, which may weaken competition among exporters.

Anatoly Kostyrev