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estimated on September 20, as cited by Reuters. Exports activity is seen as bleak by RGU, although the union assumes it could pick up in the second half of 2019 due to deflation of domestic grain prices. The union estimates that the grain harvest in 2019 will amount to 121mn tonnes. Russia is now earning some $20bn a year from grain exports – more than it earns from arms exports. Combined exports of agricultural products grew 20% to $25.9bn in 2018, almost twice as much as exports of arms and weapons. The Agriculture Ministry said in July that Russia's grain crop may rise as high as 150.3mn metric tons by 2035 in an "optimistic scenario" according to a draft strategy that includes investing billions of dollars into the sector, for grain infrastructure and logistics. The 2035 strategy will cost more than RUB4.4 trillion ($70bn) and draw on private investors, loans and government financing, the ministry said in a statement. At the same time president Vladimir Putin said last year he wants to see Russia’s grain exports to top $45bn by 2024. Russia would produce 140mn metric tons of grain annually by 2035 in the draft strategy's base-case scenario, while exporting 55.9mn metric tons, the ministry said. In an optimistic scenario, the crop could rise to 150.3mn metric tons with exports totalling 63.6mn metric tons, it said.
Grain trader Mirogroup, controlled by Russia's second-largest bank VTB, boosted grain shipments 2.5-fold in January-August 2019 to 0.8mn tonnes of grain, and became the leading exporter of grain via the Black Sea, Vedomosti daily reported on September 9 citing the estimates of IKAR. As reported by bne IntelliNews, VTB has been hoovering up assets in the grain export sector and now controls about a fifth of the business. The bank controls 50% minus one share in the United Grain Company (UGK/OZK), which was recently reported as competing for supply tenders in Egypt, one of the largest buyers of Russian grain. Black Sea shipments account for 40% of total Russian exports, according to IKAR. This agricultural season exports over Black Sea so far stood at 3.7mn tonnes out of total 8.7mn tonnes. Overall, among all destinations, Mirogroup became the fourth largest grain exporter. Market participants surveyed by Vedomosti claim that Mirogroup has been buying grain with 5-7% premium to the market, possibly with the help of VTB, which allowed it to boost exports. Both Mirgroup and VTB denied the reports. Most recent reports also claimed that Kostin reportedly asked Kremlin to hand control of the lucrative grain exports over to UGK.
The wholesale prices of fresh salmon jumped by 30% in Russia’s Far East and in Central Russia by 47% as of mid-September, because of a poor catch, RBC business portal reported on September 19 citing the data of the Ministry of Agriculture. The increased prices in the segment are likely to benefit Russia's largest producer of salmon and trout Russian Aquaculture. As reported by bne IntelliNews, Russian Aquaculture SPO’ed in 2017 and emerged as one of the largest players on fast-growing sanction-boosted Russian domestic fish market. Its profits have already soared this year after the company was hit with fish sickness last year. Analysts surveyed by RBC attribute rising prices to lower catch yields, with most of the seasonal salmon fish harvests already over. Fish has been a booming business and has attracted the attention of several oligarchs, who have invested in new fish farms. The share of salmon in Russia’s aquaculture is set to rise to over a third (37%), according to development plans for the sector drawn up by the government, the deputy head of the Federal Agency for Fishery Vasily Sokolov.
The Russian government plans to introduce new taxes and duties in the fishing industry, boosting collections of the duties water bioresources from
88 RUSSIA Country Report October 2019 ww.intellinews.com