Page 44 - bne_Magazine_September_2017

44 I Eastern Europe bne September 2017
The CEO of Yandex.Market Maxim Grishakov is cited in the press release as saying that the platform would rely on Sberbank's infrastructure to develop payment solutions on the Yandex. Market platform, including consumer lending.
The announced investment would also allow Yandex.Market to improve logistics capabilities and enhance its value proposition to domestic and international merchants.
"We see e-commerce as the important area for Yandex to develop its business and generate additional value," VTB Capital commented on August 9. The bank sees the partnership as positive, as it would allow Yandex to share the risks with a strong player and take advantage of Sberbank’s large franchise.
Previously, Yandex said it wants to trans- form Yandex.Market into an Amazon- type online hypermarket model. "With no clear leader in the Russian e-com- merce space, we see good opportunities
for Yandex to take the top spot, while the announcement of a partnership with Sberbank might make it easier to achieve that goal," VTB argues.
Meanwhile, analysts at Renaissance Capital are cautious, especially of Yandex's potential investment in logistics, "given no retail experience and multiple unsuccessful examples, underscoring the difficulty of doing e-commerce in Russia".
Yandex.Market has been operating for 17 years and although it has become a popular price comparison site, different management teams have failed to create a full-service e-commerce platform, according to RenCap, and Sberbank
as a strategic partner brings little e-commerce experience.
Other players on the market, such as Ozon and Ulmart, despite operating for almost 20 and 10 years respectively, and investing substantial sums of money
in building their own warehouses, distribution centres and pick-up points,
still lack scale and remain loss-making, RenCap warns.
The competition from abroad is strong too. EWDN writes that Yandex.Market used to dominate the Russian e-com- merce, but now struggles against two extremely strong competitors. Not only is Alibaba’s B2C subsidiary AliExpress by far number one in the Russian cross- border e-commerce flows, but it has opened its marketplace to local sellers too, and its traffic (23mn monthly visits according to SimilarWeb) matches that of Yandex.Market.
Another competitor is Avito.ru, the country’s first classifieds site, which allows businesses to operate on its site, and attracts more than 21mn desktop and laptop users every month, accord- ing to TNS Global. The company’s total revenue reached $192.5mn in 2016,
up 75% from 2015. In October 2015 Naspers announced a $1.2bn transaction to become the largest shareholder
in Avito.ru. The deal valued the classifieds site at some $2.7bn.
Eastern Europe winter harvest yields surprise on the upside
bne IntelliNews
The winter harvests in East- ern Europe are all almost in and have surprised on the upside, causing wheat prices to drop in the middle of August.
The reports come as all of Eastern Europe is reporting better than expected harvests and some are on course to
beat all-time records. The international grain commodity markets were hit on August 14 after the US Department of Agriculture (USDA) released a report predicting that grain production in Eastern Europe was going to be higher than forecast this year. Grain futures traded 3-5% lower on the news.
www.bne.eu
Harvests in Australia, the EU, US and Canada will all come in under par this year, the USDA says, but this short- fall will be more than made up by the bumper harvests in Eastern Europe.
Russia is on course to produce about 110mn tonnes of grain this year, according to the recently upgraded official forecast, which is still down on its record 119mn tonnes of last
year. However, independent fore- casters have said Russia could beat its all-time Soviet record of 130mn tonnes. Indeed, the grain yield of this year’s Russian harvest will be higher than last year’s record crop, but the overall harvest is expected to be down in terms of tonnage by 16% y/y, according to Rosstat.
The average grain yield by the begin-
“All of Eastern Europe is reporting better than expected harvests”