Inflation and consumer confidence drop in Russia

Iran wants to take over Turkey’s position on the Russian market. Tanzania also sees opportunities for export. President Putin recently visited Uzbekistan, where trade relations were on the agenda to be discussed, among other things. The Armenian apricot harvest turns out lower because of a cold March. French parliament debated on the extension of the sanctions. A majority of parliament was opposed to the sanctions, as shown during a vote. Russia destroyed illegally imported apples. Figures show almost 5,000 tonnes were intercepted during the last few months. The inflation in the country was not too bad this year, consumer confidence, however, is under pressure.

According to Russia, Iran will replace Turkey’s position in the supply of fruits and vegetables. Iran would have affirmed that the entire volume will be met. An accord will also have to be signed to create a green corridor between the countries this month. According to statistics, Iran had a market share of 0.7 per cent in Russia last year, equal to 194.3 million dollars.

Russian companies show increasing interest in fruits and vegetables from Tanzania. The Tanzanian ambassador in Moscow told the media that seven months of snow slowed down production in Russia. This offers opportunities for the Tanzanian sector.

Last week, Russian President Putin visited Uzbekistan, where he talked with colleague Karimov. Besides several diplomatic topics – such as relations between the countries, fighting terrorism and the unstable situation in Afghanistan – they talked about increasing the volume of fruits and vegetables shipped between the countries.

According to the latest estimates, the Armenian apricot harvest will be significantly lower than last year. The expectations speak of 45,000 to 55,000 tonnes. Last year the harvest amounted to 103,000 tonnes, which was an increase of 14 per cent compared to 2014. Yet the mood is not completely negative. Because there is less fruit on the trees, good sizes and quality are expected, which should result in good prices. The decrease in volume is caused by the cold March. Some regions report losses of 50 to 80 per cent, other regions have less damage, but all regions report damages in the tens of percentages.

Last week, French parliament debated about the extension of European sanctions against Russia. Voting indicated that a majority is opposed to the sanctions. The centre right party that requested the debate carried a motion to stop the sanctions. The French parliament only had indirect influence on the decision. European heads of government have to decide on the sanctions next month.

Last week the Russian phytosanitary inspectorate once again destroyed a batch of apples. The apples were imported via Belarus. According to the inspectors, the packaging of the batch of 19.5 tonnes showed signs of forgery, and the enclosed phytosanitary documents were counterfeit. 

Since November last year, the Russian government has intercepted 5,000 tonnes of illegal products. According to the government the products were imported from Belarus, Kazakhstan and Ukraine. On the border-crossings between the countries mobile control posts stopped more than 24,500 lorries. Of the 5,000 tonnes that were intercepted, 1,100 tonnes were destroyed.

According to the Russian statistics department, inflation dropped near the end of April. Between 19 April and 25 April prices increased by 0.1 per cent on average, a week earlier it had been 0.2 per cent. Inflation over the entire month amounts to 0.5 per cent. Since the beginning of this year, inflation has been 2.6 per cent. Compared with last year, when inflation was 7.9 per cent in April, this is a positive development. Within the vegetable segment, cabbage increased the most, with 6.5 per cent. Tomatoes became 2.6 per cent more expensive, while the price for cucumbers decreased by 4.4 per cent. 

It is less positive that consumer confidence dropped to 63 points in the first quarter, according to the Moscow Times. Last year, confidence during the same period was at 72 points. Actual wages have fallen sharply. In 2015, Russians lost 9.5 per cent of their wages on average, for the first quarter of this year that was already 3.9 per cent. Because of this, 76 per cent of the population had to economise. 

The Egyptian export of fruit to Russia amounted to 183.59 million dollar last year. That is equal to 44 per cent of total Egyptian export to Russia. The main products were oranges, grapes and strawberries. Vegetable export amounted to 165.99 million dollars, or 40 per cent of Egyptian export to Russia. The main products were potatoes, onions, garlic and tomatoes. 

Russian investments in Egypt are estimated at 62.77 million dollar. There are 408 Russian companies involved. With these figures, Russia is in 47th place of the largest investors in Egypt.