Russian ban on food imports from West opens new market for Indian dairy, poultry products

Russia’s ban on food imports from the West, in retaliation against sanctions over Ukraine, could open up new opportunities for Indian exporters of dairy products, fresh vegetables and poultry among others.

“It definitely presents an opportunity for us and we are keen on having a direct presence there,” said RS Sodhi, Managing Director of Gujarat Co-operative Milk Marketing Federation (GCMMF), which owns the Amul brand.

Sodhi said a large Russian company has shown interest in importing Amul products and held talks with the Indian dairy major on Friday.

“We will soon be going in for certification of our plants by the Russian authorities and expect to enter that market with our products such as butter, cheese and milk powder among others,” Sodhi.

Amul has been indirectly exporting skimmed milk powder (SMP) to Russia and it would be looking forward to launch its own brands.

India’s SMP exports to Russia have grown ten times to about 3,120 tonnes during 2013-14 from previous year’s 310 tonnes.

In value terms, the dairy exports grew to ₹67.16 crore in 2013-14 over previous year’s ₹4.53 crore.

“Russia presents a new market opportunity for Indian exporters,” said Sandeep Agarwal, Director of SMC Foods, a Delhi-based exporter.

“However, exports of SMP are not viable currently as Indian prices are higher by $300-400 a tonne over global prices,” Agarwal added.

The one-year-ban on food imports is in retaliation against sanctions imposed by the West on Russia’s defence, oil and financial sectors over its alleged support to rebels waging an insurrection in east Ukraine.

It is reported that Russia bought $43 billion worth of food last year and was by far the biggest consumer of fruit and vegetables from the European Union, the second biggest buyer of poultry from the US and a major global consumer of fish, meat and dairy.

“Talks are going on with Russia for exports of poultry, but we cannot divulge anything now,” said an official with Animal Husbandry Department under the Ministry of Agriculture.

Like in dairy, the export of poultry products from India may face a pricing hurdle.

An exporter from Namakkal said Brazil was making inroads into the Russian market because its poultry products are cheaper than India and also the eggs are bigger in size.

A fresh vegetable exporter from Bangalore said though Russia opens up new market opportunities, he would not look at venturing there at this point in time considering the economic situation there. India exported fresh vegetables worth ₹35 crore in 2013-14 to Russia, almost a four-fold growth over the previous year.