Ready or Not, Russia Set to Allow GM Crops

Peter Chekmaryov (center), director of the department of crop husbandry of Russia's Ministry of Agriculture Photo credit: Prozerno

Peter Chekmaryov (center), director of the department of crop husbandry of Russia’s Ministry of Agriculture
Photo credit: Prozerno

Growing GM crops in Russia will be officially allowed as of July 1, 2014.

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In the initial stage, just a handful of GM crops will be greenlighted for commercial growing but the list will be significantly expanded later in the year.

The Russian Ministry of Agriculture said it is following the lead of the European Union – Russia will only allow GM crops also permitted in the EU.

Arkady Zlochevskiy, head of the Russian Grain Union, said demand for GM crops will be strong among farmers, because even though GM soybean seed costs run about 1.5 times higher than the conventional variety, their use can reduce the final product cost by 20%.

Vladimir Petrychenko, CEO of  ProZerno, one of Russia’s largest agricultural analyst agencies, said Russia’s most promising GM crops are soy, corn and sugar beets.

Soybean yields in Russia in 2013 totaled just 0.97 tonnes per hectare (ha) with 1.2 million sq. ha harvested, compared with the average yield of GM soybeans in Argentina, Brazil and the U.S. of 2.5 to 3 tonnes per ha.

Many of Russia’s leading agriculture producers and distributors have already welcomed the coming change.

Maxim Basov, CEO of RusAgro, Russia’s largest sugar producer, said the use of GM technologies will help to at least double the country’s sugar production.

“One of the main problems of Russian agriculture is its small range of crops, which has resulted in a slowly developing local agricultural industry,” Basov told FCI. “For example, the current volume of wheat production is very high, unlike canola, soy, corn and other crops. Growing GM crops will allow Russian farmers to diversify crop rotation.”

Russia’s leading seed distributors generally back the potential of the biotech crops. According to Sergey Korolev, head of Botanist Company, one of Russia’s largest distributors of crop protection products, fertilizers and seeds, the Russian market for GM crops has great potential – however, he pointed out the potential consequences given Russians’ conservative nature.

Some distributors expressed fears that introducing biotech crops could cause their sales to decline sharply.

Ian Viskiviali, general director of SemAgro, the official distributor of Monsanto in Russia and one of the country’s largest distributors of crop protection products, said that Russia is “not ready” for GM crops because of a lack of consumer acceptance. “Adding GM seeds to distributors’ portfolios may lead to a steep sales decline and may not bring any revenue at the initial stage. So far, we have conducted big marketing campaigns, explaining to our customers that our sale portfolio does not contain any products of GM origin,” he told FCI.

Sergey Panamarev, general director of AgroUslugi, another leading Russian distributor of crop protection products and the official distributor of BASF in Russia, echoed his statement. He said allowing GM crops could be a two-edged sword for distributors, because although companies’ portfolios will be expanded, the list of customers may shrink.

Peter Chekmaryov, director of the department of crop husbandry of Russia’s Ministry of Agriculture, said that the Ministry has received a “large volume” of concerns from domestic farmers, who fear that the adoption of the new law will cause many domestic farmers to withdraw from the market.

Vyacheslav Shmauz, head of Shmauz Company, one of the leading agricultural holdings in the Central Black Earth Region, said GM crops may be poorly accepted by local customers at least at the initial stage. However, the situation may change in the near future.