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Russian food embargo a blow for EU

Paris - Russia's embargo against food from the European Union will affect 10% of the EU's food exports and may cause a crisis of glut in Europe, industry experts say.

The figures, at face value, mean that Russia's announcement on Thursday of a "full embargo" against EU food will deprive Russians of fresh goods in particular.

But it will also have a significant effect on many exporters who will now have to find new outlets and may lose markets to rivals in emerging countries.

Russia imports 35% of the food it consumes, and imports 10% of its needs worth €12bn a year from the European Union, data from the EU's Eurostat statistics agency show.

Among the 18 EU countries, Germany and the Netherlands are among its biggest suppliers.

Outside the EU, Brazil is a big supplier. Ukraine was also until it became embroiled in the conflict with Russia over eastern Ukraine, which lies behind the tit-for-tat trade sanctions.

Fruit and vegetables

"Russia exports grains but is a big importer of fruit and vegetables and of processed food such as meat and milk products," the head of France's main farmers' union FNSEA, Xavier Beulin, said.

Experts say the product which Russians will miss most is vegetables, since Russia imports EU vegetables worth €770m per year.

Russian imports of EU wines and spirits amount to about €1.5bn annually.

In the vegetable sector, Russia imports big quantities of EU apples, tomatoes and peaches, but the European market faces plentiful supply of these perishable goods owing to good production this year.

"Russian is shutting off imports but the products which no longer go for export are going to be offloaded in Europe and create a crisis situation," Beulin said.

Big crop

The president of the French fruit producers' federation, Luc Barbier, said: "In 2012, Spain exported about 100 000 tons of fruit to Ukraine and Russia, and this is now going to arrive on the EU market."

Italy, Spain and France are already competing in a price war over nectarines and prices have collapsed, and the same "catastrophe" looks like engulfing the market for apples, he said.

French producers sent fruit worth nearly €26m to Russia in 2012, he said.

"But this year, Poland, which exported a lot to Russia, is expecting a big crop, which will now arrive on the EU's internal market," Barbier said.

Meat exports

The world association of apple and pear producers, Wapa, said that Poland was by far the biggest producer of apples in the EU, with output expected to total 3.5 million tons this year, followed by Italy with €2.3m tons and France with €1.5m tons.

The biggest EU supplier of beef to Russia is Brazil by a long way, followed by other countries in Latin America and by North America, although US meat exports are now also under Russian embargo.

Sales of EU beef had already fallen sharply since 2013 to less than the equivalent of 50 000 tons of carcasses from 100 000 tons in 2011, the French Institute of beef producers said.

Denmark and the Netherlands would suffer most in the dairy sector.

Raising salmon

European exports of pork to Russia were already totally blocked by a Russian ban on January 29 owing to a risk of swine fever, on the basis of cases found in wild boar.

In Norway, which is not a member of the European Union, shares in companies raising salmon fell by eight to 11% on Thursday due to uncertainty about the outlook.

Russia is one of the biggest markets in the world for salmon and the biggest for Norwegian fish products.

European grain prices also fell, but traders said this reflected mainly concern about the outlook for exports of wheat and corn from Ukraine, a leading exporter, set against concern about the effect of heavy rain on wheat fields in northwest France.

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