Voices from Russia

Monday, 10 August 2015

European Dairy Industry in Crisis Due to Russian Food Embargo

00 cows in european dairy farm 100815

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European dairy farmers are facing their most serious economic crisis in decades, largely because of the continuing sanctions war between the EU and Russia. In a recent report on the subject, Radio Sweden explained that most expect the current Russian embargo of European agricultural products to lead to a new wave of lowering milk prices in the near future. It noted, “The current crisis is [already] regarded as one of the most serious in the last 40 years”, noting that with global milk prices already falling to a 30 year low, the current price of 2.65 krona (20 Roubles. 2 Renminbi. 20 INR. 0.30 USD. 0.41 AUD. 0.40 CAD. 0.28 Euro. 0.20 UK Pound) is well-below the 3.60 krona (27 Roubles. 2.50 Renminbi. 27 INR. 0.41 USD. 0.56 AUD. 0.54 CAD. 0.38 Euro. 0.27 UK Pound) minimum necessary for Swedish dairy farmers to make ends meet. Meanwhile, subsidies to Scandinavian dairy giant Arla Foods have fallen by 1.09 krona (8 Roubles. 0.75 Renminbi. 8 INR. 0.12 USD. 0.17 AUD. 0.16 CAD. 0.11 Euro. 0.08 UK Pound) over the past year. Färanäs-area dairy farmer Tore Engström told Radio Sweden, “We can’t remember when we last experienced such a deep crisis, and no one knows when it will end”.

The Association of Swedish Farmers thinks that if someone doesn’t deal with the situation in the next six months, many of Sweden’s 4,200 private dairy farmers may simply begin go bankrupt, with 4 out of 5 already suffering serious economic difficulties. Association chairman Jonas Carlsberg told Radio Sweden that according to the data of his colleagues from Denmark, “86 percent of Danish milk producers face a critical situation. I can add that a similar situation exists in Sweden as well”. Radio Sweden noted that much of the hit to producer prices has been the result of the continuing sanctions war between Europe and Russia over the Ukrainian crisis. Carlsberg complained, “The idea that farmers must pay for political decisions is fundamentally wrong. We’re waiting for decisive actions by policymakers”.  For its part, the Swedish government promised to look into the matter later this month, with EU agriculture ministers promising to do the same in early September.

Czechs, Germans, and Balts Feeling the Pinch Too

Like their Swedish counterparts, Czech dairy farmers too felt the pinch of the embargo, forced to look for new places to dump the 500 tonnes of butter and 1,500 tonnes of powdered milk that once went to the Russian market. German dairy farmers are also struggling, losing a market for 126,000 tons of cheese, according to Thorsten Sehm, the head of the Federal Union of German Milk Producers. Sehm told RIA Novosti that whilst only 1.26 million tons of Germany’s 29 million tons worth of milk went to Russia prior to the embargo, “In any market, once the supply exceeds demand, it leads to drastic changes”. So far, in Germany, Sehm noted that this led to a drop in prices to rates lower than “the crisis years of 2012 and 2009”. German Farmers’ Union spokesman Michael Lohse Lohse complained about commercial effects of political decisions, noting that for his organisation’s part, “we call on the authorities of our country to find opportunities for deepening [trade relations] with Russia”.

The Baltic States seem to be hit worst of all, with their close economic ties with Russia prior to the embargo and difficulties in finding alternative markets leading to a situation where their entire dairy industry is now on the verge of collapse. In Estonia, the sanctions war resulted in a decline in a 30 percent decline in producer prices, with Estonian milk exports falling by 17 percent in the first quarter of 2015 alone. Latvia’s dairy industry suffered a similar decline, with Agriculture Minister Janis Duklavs noting that he’d appeal to the EU for additional funds to save the dairy industry from total paralysis, warning that farmers are on the verge of destroying their livestock and liquidating their farms. Latvian Association of Milk Producers Chairperson Ieva Alpa Eisenberg noted that Latvian farmers “have plunged into despair, because we don’t know when the situation will improve. One doesn’t know whether one can climb a little bit further into debt, and whether one will be able to pay it back”. He noted that the present crisis is the worst the country faced in over 15 years. In Lithuania, dairy farmers join the rest of the agricultural sector, which has faced a 30 percent decline in exports in mid-2015, compared with a year earlier. Agriculture Minister Virginija Baltraitiene noted that she’d ask EU Commissioner for Agriculture for 32 million Euros (2.25 billion Roubles. 217.6 million Renminbi. 2.24 billion INR. 35 million USD. 47.6 million AUD. 46 million CAD. 22.6 million UK Pounds) to help save the industry. Local experts warn that Lithuania may have to reduce dairy production by 50 percent in the near future.

Global Factors

This spring, the EU lifted national quotas on milk production, with each country now able to increase dairy production at will, resulting in growing production and a glut in the market. This exacerbated the crisis in the loss of exports to Russia. Furthermore, China significantly reduced its purchase of powdered milk from EU sources, which only deepens the crisis. German Farmers’ Union spokesman Lohse explained, “Of the 10 cent drop in milk prices, 2-3 cents are the result of the Russian embargo, with the rest resulting from other factors. These include the decline in exports to China… as well as general overproduction of milk in the EU”. Federal Union of German Milk Producers chairman Sehm complained that local politicians “aren’t undertaking any efforts to create an appropriate regulatory environment for the milk market”, adding that the same problem exists in France, Spain, and Italy, and in other EU countries.

In August 2014, Russia introduced an embargo on several categories of food products from the EU, the USA, Canada, Australia, and Norway, in response to the anti-Russian sanctions introduced earlier by these countries over the Ukrainian Civil War. This June, the Russian government decided to extend the embargo until August 2016, responding to the EU’s extension of sanctions.

10 August 2015

Sputnik International

http://sputniknews.com/business/20150810/1025581375.html

Friday, 24 October 2014

It’s Gonna be Napolitano in Karelia! Valaam Monastery to Send Monk to Italy to Learn Secrets of Mozzarella Makin’… No Lie

Sergei Yolkin. It's Not a Cow; It's a Dairy Centre Prodution Unit. 2011

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There have been all sorts of interesting (but expected) fallout from the sanctions. Makfa, which was already the biggest domestic pasta maker in Russia (they’re in Yekaterinburg), just got bigger… they’re cracking down on Mickey Dee’s… but this one is a “Strange, but Nonetheless True”. The famous Valaam Monastery in Karelia is sending one of the brothers to Italy… to ferret out the secrets of mozzarella makin’. Perspirin’ minds wanna know… are they gonna bring in gen-u-wine Eye-tal-i-an water buffaloes for the real deal mozzarell’ di bufala or are they just gonna make wimpy old cow’s milk mozzarell’ with the milk from their own dairy herd? On the other hand, is the said brother gonna do his best to convert Joey the Cheese-Maker and entice him to come to northern climes? In that case, he’d be “The Spy that Came INTO the Cold!” (A little riff on John le Carré‘s The Spy Who Came in from the Cold, for them in the know.) Now, that’s a mystery well-worth cracking!

BMD

Friday, 18 October 2013

18 October 2013. Sergei Yolkin’s World. Events of the Week in Cartoons by Sergei Yolkin: 7-11 October 2013

00 Sergei Yolkin. Events of the Week in Cartoons by Sergei Yolkin. 7-11 October 2013. 2013

Events of the Week in Cartoons by Sergei Yolkin: 7-11 October 2013

Sergei Yolkin

2013

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Dr Onishchenko is the equivalent of the US Surgeon General. Vladimir Klichko and Aleksandr Povetkin had a well-publicised match in Moscow last week, ending in victory for Klichko, although Povetkin showed much spunk and “heart”. Isaev resigned his posts with the United Russia party after it came out that his assistant Aleksandr Poglazov was kicked off an Aeroflot flight for drunken behaviour and Isayev threatened the cabin crew with dismissal and personal harm.

BMD

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Sergei Yolkin peeks at the opposition between Klichko and Povetkin, Gosduma Deputy Andrei Isayev and Aeroflot, and Head Sanitary Doctor Gennady Onishchenko and Lithuanian dairy products.

11 October 2013

Sergei Yolkin

RIA-Novosti

http://ria.ru/caricature/20131011/969295384.html

Friday, 2 December 2011

2 December 2011. Sergei Yolkin’s World: It’s Not a Cow; It’s a Dairy Centre Production Unit

It’s Not a Cow; It’s a Dairy Centre Production Unit

Sergei Yolkin

2011

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In 2012, plans call for the construction of five modern dairy complexes in Moscow Oblast; two such enterprises came online in 2011.

28 November 2011

Sergei Yolkin

RIA-Novosti

http://ria.ru/caricature/20111128/500560565.html

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