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MARKETS ▶▶▶


Expensive inputs prompt feed mills to raise prices for their products in Russia.


The Russian government has begun regulating prices on the domestic food market.


Union’s analytical department, Russia set an export quota and the new tax in the hope that domestic prices would drop, but this did not happen, even quite the opposite: prices be- gan to increase – on average by US$ 20 per tonne. Besides, export quotas could again spoil Russia’s image as a reliable trade partner on the global market. Speaking in 2020, Alex- ander Korbut, vice president of the Russian Grain Union, said that the quota prompted some importers to refrain from buy- ing Russian grain. The quota’s introduction might be associat- ed with some serious long-term consequences, he warned. The Russian Agricultural Ministry is currently considering the introduction of a 25 euro export tax per tonne of barley and 10 euro export tax per tonne of corn. Besides, the export tax on wheat could be increased to 50 euro per tonne.


Ukraine sticks to free trade Expensive feed is becoming an issue for feed producers not only in Russia but also in most countries in the CIS region. At the end of 2020, several Ukrainian business unions appealed to their government, begging to limit grain exports in order to constrain the rise of grain prices on the domestic market. The absence of some restrictive measures, it was said, would lead to strong food inflation and severely hit both farmers and consumers, the farmers warned. In the next few months, the retail price of pork is likely to in- crease in Ukraine, the Ukraine livestock association said in a statement on its website. The main reason is the growth in prices for grain components, soybeans, and sunflower seeds, which went up by 20% to 40% in 2020. Besides, prices are likely to keep growing, given the problems with the new har- vest, the livestock association warned. However, Ukrainian government officials have promised to avoid any artificial


28 ▶ ALL ABOUT FEED | Volume 29, No. 1, 2021


export restrictions. Instead, Ukraine’s Ministry for Develop- ment of Economy, Trade, and Agriculture and traders agreed that wheat exports should not exceed 17.5 million tonnes in the new marketing year. The Ministry signed a memorandum with several industry associations on grain export plans, which are designed to maintain the stability and predictabili- ty of the grain market. In a similar way, the government, to- gether with the main stakeholders of the grain market, man- aged to ensure stability in the grain market in 2020, Minister Taras Vysotskyi wrote on his Facebook page. Still, not all market participants would agree that the market situation is stable. A sharp rise in feed prices pushed the pro- duction cost of one egg from UAH1.8 to UAH 2.8 (US$ 0.06 to 0.09), Ukraine poultry farmers estimated. In early January the Ukraine union of poultry farmers and the Ukraine pig farmers association called the government to limit maize exports at 22 million tonnes per year, citing fears over sharply rising feed prices. “This is a global growth trend [of feed prices]. These days the price of feed has jumped by nearly 60%. Our harvest was fine. The price on the domestic market is follow- ing global dynamics,” commented Vladimir Rudenko, opera- tional director of the Ukraine’s biggest egg producer Avan- gard. The price dynamics on the Ukraine egg market are rather unpredictable due to the continuing uncertainty about feed prices, but there is a ceiling the prices are unlikely to break, according to the Ukraine Union of Poultry Farmers. “We will certainly not see the price of UAH50 (US$ 1.8) [per ten eggs], because, at this price, we could rather import eggs from Poland and Belarus. This is not a price that we could ac- cept on the domestic market. This is the limit,” Karpenko add- ed. However, this might not be the case since feed prices are rising in a similar way both in Belarus and in Poland.


PHOTO: ENERGOTECHPROECT


PHOTO: 2GIS COMPANY


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