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INTERVIEW ▶▶▶ Sergey Yushin


Russia embraces its new global role in pork


For decades after the collapse of the Soviet Union, Russia was one of the biggest importers in the global pork market. Those times are over now, as the Russian pig industry has not only secured self-sufficiency, but also managed to become a low-cost producer. Where to next? Sergey Yushin of the National Meat Association explains.


BY VLADISLAV VOROTNIKOV, CORRESPONDENT T


he Russian National Meat Association (NMA) is one of the country’s biggest and most powerful unions of farm- ers and meat processors. Liaising with the government, the NMA puts a lot of effort into making the domestic


pig industry more efficient, to promote Russian pork in overseas markets and to boost sales to non-Russian customers. The country has all it needs in order to become one of the world’s strongest pork exporters, Sergey Yushin, NMA chief of the executive committee believes.


Pig Progress: Let’s first focus on current events. What impact has Covid-19 had on the Russian pig industry? Sergey Yushin: “So far, the negative impact has not been as strong as in some other segments, for example the beef industry. The cri- sis has primarily affected the hospitality industry, which is not a major sales channel for pork in Russia. We see that pork sales in Russia are up thanks to low prices. In the first four months of 2020 the average price for pork in Russia went down by 10%. “Additionally, Russian companies have to bear high costs in order to not let the virus penetrate their production facilities. With pro- duction costs being as much as 15% higher now compared to the previous year, and in the context of falling prices, some compa- nies may make losses. Covid-19 has not disrupted operations in Russian slaughterhouses, as it has in some other countries, includ- ing the US. “And yet, we may experience a negative impact from the pan- demic in future. In particular, it may affect the demand for sausag- es in the Russian market and hence the demand for pork. It is


likely we are entering a difficult period of enhanced price compe- tition between poultry and pork. “


What is the current self-sufficiency rate in the Russian pork market? “After 15 years of massive investment exceeding US$ 10 billion, Russia is producing pork in the amounts and varieties needed to fully meet domestic demand. In 2018, imports and exports were equal. In 2019, we increased production by 150,000 tonnes com- pared to the year before, while exports grew to 90,000 tonnes. We experienced some saturation in the market, due to a slight in- crease in domestic demand. That affected prices, which have been falling drastically since late 2020. “As for regional distribution of production: it is well balanced. In- deed most production is concentrated in the European part of Russia where a large part of the population is located. The Cen- tral Federal District [around Moscow, PP] accounts for roughly 40% of the established pork production capacity, but the well-developed logistics system makes it possible to supply pork to remote regions. “We see some reduction in pork production in the Far East due to outbreaks of African Swine Fever (ASF), but there are some major projects underway there. We expect no shortage; rather, we ex- pect a surplus of pork there, since those projects were laid down with excessive capacities to be able to export pork to China.”


How attractive is investing in Russia’s pig industry, given that some Russian pig farms closed out 2019 with losses? “2019 was another good year for the industry. Wholesale prices for pork carcasses became rather low only by the end of the year.


▶PIG PROGRESS | Volume 36, No. 4, 2020 23


PHOTOS: VLADISLAV VOROTNIKOV


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