Evgeny Sluchevsky, Director of Agricultural and Industrial Complex of the Magnit retail chain, said at the Magnit and Agribusiness: Partnership for Buyers forum on Monday in Moscow that the main reason for the large difference between the producer’s selling price and the retail price on the shelf is the inefficiency of the supply chain , says Interfax.
According to Sluchevsky, this is clearly seen in the example of two industries - the production of open ground vegetables, where the share of small producers and private farms is large, and the production of greenhouse vegetables, where the main players are large enterprises.
“In the segment of open ground vegetables, the difference between the producer price and the price on the shelf sometimes reaches 100% - and this is not a retail chain markup. The situation is completely different in the greenhouse vegetable industry. This is the inefficiency of the production and logistics chain, and we have joined in solving this problem by “straightening” supply chains, excluding traders from it, and developing agricultural contracts,” he said.
According to the presentation of the analytical company "Technologies of Growth" presented at the forum, the retail price for table beets in 2022 was 107% higher than the selling price, for onions - by 68%, for cabbage - by 50%, for tomatoes - by 27%.
As reported, in the next two years, Magnit plans to almost completely meet the demand for Russian vegetables and fruits through supplies under agricultural contracts - long-term contracts with domestic agricultural producers with guaranteed shipment volumes. In 2022, the volume of supplies to the stores of the Russian fruit and vegetable network under agricultural contracts exceeded 340 thousand tons, which was a record figure and exceeded the result of 11 by 2021%. The main share of supplies falls on vegetables of the borscht set (beets, cabbage, potatoes, carrots). In addition, pumpkin, turnip, celery, as well as apples, melons and other crops are supplied under agricultural contracts.
According to the results of last year, the share of fruits and vegetables received by stores under agricultural contracts exceeded 30% of the total sales of these products. In 2023, the volume of deliveries under agricultural contracts will increase to more than 400 thousand tons, the share - up to 50%. In 2024, Russian vegetables and fruits supplied under agricultural contracts will account for more than 80% of sales, which is the target for the retail chain.
