The projected high grain harvest in Russia and population growth rates in the Middle East and Africa allowed Russian Agricultural Bank (RusAg, the Bank) experts to identify a group of countries that are promising in terms of increasing exports. This group, according to the Bank’s Center for Industry Expertise, includes Saudi Arabia, Egypt, Ethiopia, Tanzania, Mozambique, Benin and Niger.
Grain is already the mainstay of Russian agricultural exports to the Middle East. Thus, the volume of deliveries of wheat, barley and other crops to Egypt and Saudi Arabia in 2021 amounted to USD 2 billion in monetary terms, RusAg’s experts note at the All-Russian Grain Forum-2022.
“The most promising markets should be considered those where the need for food is growing the fastest. This is due to both population growth and an increase in the relatively low purchasing power so far. Such prerequisites are emerging in the Middle East and in a number of African countries. Food supplies to these countries may increase, but the ‘rich markets’ are already saturated, and we do not expect a significant increase in exports to them. For Russian producers, the main factors for increasing supplies are high yields and well-established supply mechanisms to the Middle East and Africa. RusAg’s cooperation with grain exporting companies contributes to strengthening global food security. In the domestic market, the driver of the wheat market is the growing demand for use from pig and turkey breeding,” said Andrey Dalnov, Head of Center for Industry Expertise at RusAg.
In Russia, according to the preliminary data, the grain harvest in 2022 may reach 130 million tons, including 87 million tons of wheat. This result will be a record for the collection of this grain crop in the country. The previous record was set in 2017 – 86 million tons.
RusAg, for its part, actively supports the country’s grain industry. Since 2000, it has spent about RUB 1.4 trillion on growing, processing and storing grain, which is 13% of the total volume of loans to corporate agribusiness borrowers.
With the help of RusAg financing, more than 170 investment projects in the grain industry were put into operation throughout the country.