“The expansion of the geography of supplies of semi-finished products, in particular the popular chicken nuggets, is another step in implementing our strategy of business diversification,” said Miratorg’s CEO Viktor Linnik. “The current demand for semi-finished production of Miratorg is more than enough to begin exporting.”
The company also said that it was expanding production capacities and was targeting increased retail and foodservice sales. Exports from the Kaliningrad plant made sense logistically because it was in the most western region of Russia, although the company has not yet announced when the first deliveries would be made or how large they were likely be.
Russia exported small quantities of poultry to the EU in mid-2015. The first company that received approval for exports was turkey manufacturer Krasnobor. In early September, another Russian company, Perepelkin and Zhoev, which is focused on the production of quail meat, also obtained the right to supply poultry to the EU.
Devaluation
Russian market insiders said many Russian meat producers were hoping to boost exports after the devaluation of the Russian ruble against hard currencies and a fall in consumption in the domestic market.
“Russia obtained the general right to export poultry meat to the EU in 2009, but until recently, the country’s Union of Poultry Farmers considered the prospects of such supplies very sceptical,” commented Russian agricultural analyst Eugene Gerden. “No one manufacturer for several years has applied for personal approval. The situation changed after the devaluation of the Russian ruble in December 2014, when the cost of Russian poultry turned to be competitive in European markets.”
CEO of Cherkizovo Sergei Mikhailov added: “It is necessary to begin the withdrawal of Russian meat products, particularly chicken meat for export, to solve the problem of limited demand [on the domestic market]. On poultry it is quite difficult to compete on price with Brazilian manufacturers, but we need to start going out to foreign markets.”
The head of the analytical agency Agrifood Strategies, Albert Davleev, said: “The decline in consumer activity in general reflects the dynamics of the reduction in real incomes.” He added that the consumption of poultry in the first five months of the year decreased by 5-7%.