Analysis of the Agribusiness Sector in Southern Russia

This Study was commissioned by the European Bank for Reconstruction and Development (EBRD) and carried out by the Investment Centre Division of the Food and Agriculture Organization of the United Nations (FAO), under its cooperation with the EBRD. Its objective was to assess the remaining transition challenges affecting the development of agri-food value chains in Southern Russia. The EBRD required this analysis to establish priorities for future interventions inform investment decisions and identify relevant topics for policy dialogue.

Due to constraints in time and resources, the Study concentrated on two value chains in Southern Russia: the cereal and the meat value chains (including the beef, pork and poultry sectors). The four biggest areas in the Southern Federal Okrug were covered by this Study, namely the Krasnodar krai, the Stavropol krai, the Rostov oblast and the Volgograd oblast. The Study included an informant poll, with 106 questionnaires returned, to assess the development of the cereal and meat industries in the four above regions. Two case studies were carried out in the Rostov area for an in-depth description of the value chains both in the cereal and the meat industries. Finally, a number of interviews were conducted in the Moscow and Rostov oblasts with market analysts, policy makers and the business community. The Study is also based on the review of existing literature and official statistics.

The first section of the Study describes the general situation in the Russian agri-food sector, including major trends in recent years, an overview of agricultural policy and ad hoc governmental measures in reaction to soaring food prices. The second section is a general overview of agri-food development in Southern Russia. The third and fourth sections focus on the analysis of the cereal and meat value chains and the identification of major bottlenecks. The results of the poll are presented in a separate section. The paper ends with a series of conclusions and recommendations.

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