Page 138 - RusRPTMay21

In our coverage universe, we forecast Rusagro’s sugar segment contributing 20% of total revenues and 25% of EBITDA for 2021F. Price capping initiatives limit the potential upside, while the segment has still delivered impressive results in first half of the season (2H20 EBITDA margin of 20%) that are mostly prolonged to 2021. The company has estimated the monthly loss of various price caps at RUB 200mn, which could imply 12% of our annual net income forecast, if prolonged throughout 2021, creating downside risks.
9.1.6 Agriculture sector news
Russia to hike duties on meat imports. Half of developing countries have import incentives removed, a potential uplift in import prices that is positive for domestic producers.
According to a Eurasian Economic Union decision, the total number of developing countries, which currently have a 25% discount for their import duty to Russia, might be more than halved. The respective measure is to be put in place from 1 October 2021.
The share of imported meat in total consumption was 6% as of 2020, having dropped from 30% over the past ten years. The highest share was in beef (14%), while it was a moderate 5% for poultry and almost zero for pork. The following measure is likely to lift import prices further, decreasing their competitive stance, and might provide further
138 RUSSIA Country Report May 2021 www.intellinews.com