Promising trade
Russia will supply pork to China this year
Russia wants to supply pork and poultry to China before the end of this year. According to a spokesman for the Russian Ministry of Agriculture, Evgeny Gromkyo, the talks are in their final stages and the Chinese are benevolent. Logistically, trading is a logical choice.
According to Gromkyo, the first deliveries are not far away. "I am convinced that exports can start before the end of 2017." The export potential of the Russian pig sector is enormous. This year, Russia reportedly exported about 25.000 tons. According to Gromkyo, this could easily have been 100.000 tons. The Russian Minister of Agriculture, Alexander Tkachyov, also confirmed at an earlier stage that Russia has export plans to China.
Export necessary
It is understandable that Russia sets its sights on China. The Russian pig sector is growing rapidly and will have to think about exports in the context of square footage. Despite the fact that Russia is not yet self-sufficient in certain areas. Since 2005, the pig sector has been reporting only growth figures. Last year the percentage growth was barely 10%, this year there will be another 4,5% extra production. With a production of 3 million tons of pork in 2017, Russia is the fifth largest producer in the world.
Geographically interesting
It is logical that Russia wants to supply neighboring China with pork. It would not be illogical for the logistics between the two countries to go by rail. Both countries border each other and the advantages of the train are considerable. It is much cheaper than flying and much faster than sailing. A train transport between China and Europe takes 15 to 17 days, a container ship takes at least 1 month. In theory, China could be supplied with pork from western Russia within 2 weeks.
The Chinese government is investing heavily in improving rail connections with its hinterland. The country is investing at least $40 billion in what they call the 'New Silk Road'.
Weak ruble
The weak ruble also provides clues. The Russian central bank decided on November 10, 2014 to let go of the ruble exchange rate. The ruble depreciated by about 30% against the dollar. The ruble is quite weak due to the unrest in Crimea and low oil prices. The weak ruble is a necessity for importers, but a virtue for exporters.
Wouter Job
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