VTB Group, a global provider of financial services, estimates that exports of agricultural goods will surpass $50 billion by 2030. Leading positions in the grain segment will be complemented by new growth areas in meat and dairy production, as well as the food processing industry.
This forecast was presented by VTB analysts at the 15th VTB Russia Calling! Investment Forum, who identified the main growth factors as:
- Increased efficiency and experience of local producers
- Achieving the threshold for ensuring food security in the Russian Federation not only for grain but also across vegetable oils, fish and fish products, sugar, meat, and meat products. This will significantly expand the list of value-added agro-industrial complex goods for export.
- Potential for production growth relative to current cultivated areas and production capacities
- Strong positions in production costs
- Growing demand from China, the Middle East, North Africa, and Southeast Asia
Vitaly Sergeychuk, member of the management board of VTB, said: “Despite the current cycle of a high key rate and expensive borrowing, we see that our clients in the agricultural and industrial complex segment are fulfilling their obligations to banks, counter-parties, and employees in a timely manner. Moreover, they are constantly seeking out new markets and business partners. For instance, over the last three-five years, most of them have established export production and logistics chains for their products, including to Asia, the Far East, the Middle East, and Africa.
“At the same time, in light of new challenges to maintain the sovereignty of the country’s food security, the priority for players in this market will be to further increase vertical integration and develop new business directions. These include selective breeding and genetics, knowledge-intensive industries, dairy production, and livestock breeding.”
