Russia's decision to ban European imports could provoke a crisis without precedent, claimed Manel Simon, director of Catalan producer association Afrucat and an influential player in Europe’s fruit business.
But leading industry figures in the UK have told FPJ that Russia’s sweeping ban on agricultural products imported from the EU, the US and Australia - a retaliatory measure designed to hit back at the economic sanctions imposed by its targets in the wake of the MH17 disaster - should have no long-term repercussions for the British fresh fruit and vegetable industry.
Little market destabilisation is expected due to other EU nations now having a surplus of product, although according to Guy Attenborough, communications director at the Agricultural and Horticultural Development Board (AHDB),butter and cheese will see a degree of market realignment required as Russia seeks alternative sources of supply and mainland EU seeks alternative export markets which is likely to add to the current downward price pressure in the short term.
Nigel Jenney, chief executive of the Fresh Produce Consortium (FPC), said: “In terms of the UK position, we need to keep things in context. Only modest volumes of our product goes to Russia.
“When it comes to EU exports, Russia takes nearly a third, so that’s a significant volume. But for UK production specifically, there should be no material effect in terms of exports.
“While this is an issue, it will run for a significant period of time, so there’s no real rush to respond, as such - it’s a time for careful consideration and talks.”
Phil Acock, MD at fruit processor Fourayes, believes the global fresh produce industry will take a proportional approach to the situation. While businesses in countries still supplying Russia may well divert some of their supply away from existing partners, that vacuum could then be filled with produce from countries Russia is refusing to deal with. 'It will be one big merry-go-round,' he said.
'It needs to be managed well, and there may be blimps along the way, but it will be resolved.'
Guy Attenborough, communications director at the Agricultural and Horticultural Development Board (AHDB), is of a similar opinion to Acock.
He told FPJ: “With your perishable stuff, that may be dumped onto wholesale markets in the short-term. But longer-life stuff, such as the root crops, they can be stored until alternative markets can be found.
“We could see possible short-term downward pressure on pricing in some categories, but I think direct impact on the UK will be limited.
“If you look at past examples of market disruption, the market is quite good and quick at sorting itself out.
“The Russian people will still want to eat all the goods they're used to eating, so they will still have to be sourced. Those who supply them will arrange it so the pieces of the jigsaw all come together.”
The ban came into force yesterday (7 August) and will last for one year, although Moscow officials have said that they may review the situation if economic sanctions imposed by those countries targeted are to be lifted
As well as in Spain, the decision has been met with dismay among Russia’s major international fresh produce suppliers, including Poland, Netherlands, France, Belgium, Italy, and Greece.
As a whole, the EU exported 2.4 million tonnes of fresh fruit and vegetables worth a total of €1.91 billion to Russia in 2013.
The leading fruits and vegetables sold to the country were apples (790,000 tonnes), pears (201,000 tonnes), fresh tomatoes (230,000 tonnes) and cabbage (91,200 tonnes).
With regards to UK produce exports to Russia, as of July 2013,Russia had banned the import of seed potatoes from the EU. In May 2014, some countries were allowed to start exporting again, but that didn't include Britain.
And, while Russia previously imported nearly 25 per cent of its fruit and veg from the EU, only 0.006 per cent of this came from the UK (483 tonnes).
No comments yet