The import of imported food potatoes into Russia at the beginning of the year showed a phenomenal growth. In January, the import of "second bread" increased by almost an order of magnitude compared to the same month last year - by 960 percent.
Alexey Plugov, general director of the AB-Center, an expert and analytical center for agribusiness, agrees that potato imports should not be ignored. He also believes that the role of private farms in this market is greatly exaggerated, and this makes potatoes from Egypt and Azerbaijan a full-fledged player in Russian retail.
“Potatoes grown in private plots, even though the bill goes to millions of tons, only partially reaches the sale. Most of it simply decays on site due to the lack of conditions for storage and transportation. Therefore, the volumes of accumulated potatoes and the volumes of potatoes supplied to retail chains differ many times, ”the expert says, explaining why even a good harvest does not necessarily lead to a decrease in retail prices.
In addition to losses on the way to stores, the potato harvest in 2020 was 800 thousand tons lower than a year earlier (about 6 million 570 thousand tons, that is, the drop was even less than predicted), Plowov recalls. Accordingly, this pushed the rise in prices from 9 rubles. per kilogram a year earlier up to 19 rubles (these are wholesale prices; in retail, they should be at least doubled). But a bad year in Russia was a good opportunity for importers to increase their market share.
Imported potatoes in good years for domestic potato growers did not compete with Russian ones, not only because of small volumes, but also due to the fact that young Egyptian potatoes occupy a separate niche on the Russian market - not quite premium, but not in the "economy" class either. notes Plugov. It was bought, for example, by restaurants that are not deterred by the higher price compared to local potatoes. But at the end of 2020 - beginning of 2021, the price of domestic potatoes turned out to be so high due to a poor harvest that its import competitor fell into the same price niche with it. In some cases, the potatoes brought “from overseas” turn out to be cheaper for the end buyer this spring than the ones grown in the neighboring village.
“Now on the potato market there is a rather rare situation when the availability of imported products has a lowering, rather than increasing, effect on the average price level,” the expert says. In conditions of a deficit, imports at least slightly increase the supply, without which retail prices would have been even higher. This year, it is import prices that are catching up with prices for domestic potatoes, even compensating for the depreciation of the ruble against foreign currencies, ”the expert notes.
Plowov warns that the January “landslide growth” (if one can use such a phrase) of imports is only the first sign. The real shaft will go in March-April, when Egypt starts shipping, and young potatoes from Azerbaijan will be added by May.
“Azerbaijani potatoes will be three times more expensive than Russian ones, but young potatoes are, in fact, a different product, not last year's potatoes. It has a different niche, and the demand in this niche is always stable, ”he says.