Under fire from the Accounts Chamber

The objects of analysis were: the Ministry of agriculture of Russia, Federal service for veterinary and phytosanitary supervision, Federal service of state statistics, Federal customs service, Federal state budgetary scientific institution "All-Russian scientific research Institute of breeding", the national Union of milk producers, government authorities of constituent entities of the Russian Federation (selectively).

Analysis

The Audit Board noted that in general the agricultural sector is characterized by the growth of production volumes of agricultural products. In 2015 the growth was 3%, in 2016 it amounted to 3.4%. The increase was due to the good grain harvest, also thanks to the meat industry. Crop production has reached the threshold values of Food Security Doctrine of the Russian Federation.

The problem is the dairy industry. According to the report, 81.2% is the level of self-sufficiency with milk at the expense of own production in 2015. The threshold value of Food Security Doctrine is 90%.

A couple of “but”

To the question "Can the dairy industry reach a threshold value of Food Security Doctrine?", the experts unanimously answer "Yes!". However, there are some “BUT”.

First, it is the time. It will take 10-15 years to achieve the required target of 90%. This was stated in the comment by Mikhail Mishchenko, Director of the Russian Dairy Research Center: "We will not be able to do everything very quickly. Let us denote 2025. This is a normal time to ensure 90-100% of own consumption. Generally self-sufficiency and food security is not the end target. It is important that we not just have the opportunity to fulfill the task, being fully self-sufficient. It is essential that in case of any unforeseen political or economic situations, the state could feed the population with domestic products. Otherwise, there is no need to produce products that will be fully consumed. If we are talking about self-sufficiency, we should regarding the prospect have more planning some for export. This is an important point".

Second thing is the stability of the market. Lyudmila Manitskaya, Executive Director of the Dairy Union of Russia: "The key to achieving the threshold values of Food Security Doctrine is in the growth of two factors: production and consumption. But now the dairy market is distorted, so the first priority is stabilization, we need a balance in all segments of the market."

The third is a clear mechanism of state support. Vladimir Labinov, Head of the Technical Committee "Milk and dairy products", Deputy Director on scientific-organizational activities of VNITIP (All-Russian research and technological Institute of poultry) in the comments for The DairyNews indicated that to achieve the target of the Doctrine "one requires consolidated at all levels understanding of the mechanisms of state support, which could be applied to industry."

Measures

The state should first build the capacity of the market, which, according to experts, can be provided by social nutrition, cheese-making, butter and new directions, for example, air transportation. "We in cooperation with the Russian Dairy Research Center made a decision to do the calculation of milk consumption in aircrafts, air companies. Just to calculate how many dairy products in terms of raw milk are consumed in the airlines: Aeroflot, Transaero, British Airways and so on? And now we can say that Russian airlines do not feed their consumers with dairy products. And when you fly by, for example, Swiss airlines, about 500 g of raw milk is accounted for each passenger ", - said Mikhail Mishchenko in the comments for The DairyNews.

Secondly, the government needs to give the industry clear rules of the game. "Without transparent terms of government support and regulatory policy, we will remain in unstable market conditions falling behind the incomes of consumers", - said Lyudmila Manitskaya, Executive Director of the Dairy Union of Russia. However, if we talk about the amount of support it is like a “bottomless sea”. "Yes, support is insufficient. If the amount is a priority and not the skill it will never be enough. Strategists, who know how to fight, not coincidentally concentrated power in the direction of the main blow," says Alexander Nikitin, member of the Board of Directors of "Alantal". Meanwhile, the Ministry of agriculture announced that to subsidize short-term loans another 24 billion rubles is needed.

Import substitution: was there any?

The results of import substitution, experts say, are almost invisible. Ravil Dautov expressed it very precisely: "Import substitution in the dairy industry did not happen. What we have is filling empty shelves under the conditions of anti-sanctions with products, made on the knee on the principle that will be OK. In order to have proper import substitution it is necessary to control the quality of manufactured products".

By 2026

Despite the inflow of capital and government support, the dairy industry of Russia according to the Accounts Chamber is problematic. However, by 2026, under transparent rules of support and with the growth of market capacity Russia will not only reach the level of self-sufficiency in milk, but, under forecasts of experts, will become an exporter of dairy products. And then the results of import substitution will be visible.

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