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In a bid to address rising butter prices and production costs, the Russian government is exploring options to increase imports from friendly countries. This move comes as butter production in Russia increased by 1.6% in January-August 2024, according to the latest data.
Oksana Lut, the head of the department, has confirmed that there are no plans for state price regulation at present. However, Olga Epifanova, a member of the Committee on Agrarian and Food Policy, has suggested temporarily zeroing import duties to increase market supply and help stabilize prices.
The director general of "Soyuzmoloko", Artem Belov, agrees that importing butter from friendly countries will improve the market situation. The Ministry of Agriculture is currently considering mechanisms to increase imports from multiple countries, including India and Iran.
Turkey, another country exporting butter to Russia, has recently started exporting butter to Russia, as reported by Rosselkhoznadzor. Belarus has supplied the most butter to Russia so far this year.
With approximately 20,000 tons of butter needing to be imported into Russia in the next six months, the Ministry of Agriculture is implementing measures to address the situation. The rise in butter prices is linked to higher raw material and credit costs.
Russia is facing economic challenges, including high interest rates, inflation, and a labor shortage, which have impacted various sectors, including food production. These broader economic issues could influence policies related to food imports.
In response to food shortages in the past, the Russian government has taken steps such as removing import duties on certain vegetables to restock shelves with foreign produce. Similar measures could potentially be applied to dairy products like butter.
Experts suggest measures to stabilize butter prices, including duty-free imports from friendly countries and temporary import quotas. However, no specific friendly countries have been mentioned beyond India and Iran.
Long-term measures include increasing raw milk production to reduce dependence on imports. The Ministry of Agriculture is yet to announce further details on these measures.
As the situation evolves, it is expected that the Russian government will continue to explore strategies to address the rise in butter prices and ensure a stable supply of dairy products.
The Ministry of Agriculture is considering not only increasing imports from India and Iran but also from other friendly countries to address the rising butter prices and production costs in Russia. The committee on agrarian and food policy has suggested temporarily zeroing import duties as a potential solution to increase market supply and help stabilize prices.
