Since Russia announced its ban on certain food products from the U.S., the EU, Australia, Norway and Canada, other agricultural countries have started recalibrating their exports to capitalize on Russian demand.

For Andrés Rodríguez, who represents the Chilean Walnut Commission and the Chilean Prunes Association, the real effects of the situation will "mainly depend on the willingness [of Russians] to pay current international prices for these products, and on the availability of stock that's there right now".

Rodríguez told www.freshfruitportal.com that Russia was Chile's leading market for prunes, making up for around 15% of shipments.

"Russia is the main market for Chilean prunes...in 2013 10,089 [metric] tons (MT) were shipped with a value of more than US$24.4 million," he said.

"We can observe that Chile is already a very strong exporter to the Russian market. Today, Russia imports around 28,000MT, of which 20,000MT has historically been divided equally between Chile and Argentina, with the rest distributed between the U.S., Serbia and Moldova."

This year however, Chile's main competitor Argentina is set to have a much lower percentage due to its very low plum crop.

"In this situation we could think that Russia will increase its demand for Chilean prunes, but it is important to consider that we find ourselves in a year in which international prune prices are very high, and this adds to a period of devaluation for the Russian ruble, which will probably lead to a contraction in demand.

"We will have to wait and see how this develops for the rest of the year, because a contraction has already been seen, including for Chilean prunes, so there shouldn't be bigger exports than in previous years."

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When asked about walnuts, Rodríguez said Chile was not one of Russia's main providers as the country mainly imported from the Ukraine, due to its proximity and lower prices.

"The Ukraine represents around 90% of exports to the Russian market, which on average imports around 10,000 net MT. Chile represents 4%, the U.S. 1%, and the rest is from other Eastern European countries.

"More than Russia's measures against the U.S. or Europe, what could potentially impact positively on demand for Chilean walnuts is the direct conflict with the Ukraine, which is Russia's main provider. This impact will mainly depend on how Russia absorbs current prices for Chilean walnuts, and on the other hand, the availability that's there at this point of the season."

The executive added that if Russia's measures were to continue over time, market conditions would be reestablished and Chile could play a leading role, considering the country exported 1,187MT of in-shell walnuts worth US$8.6 million to Russia last year.

In terms of almonds, he emphasized Chile's percentage of the global market was very small, but new opportunities could arise from the ban.

"While the U.S. is the main almond supplier globally, and there is no exception in Russia, Chile provides a very small quota of global production and with higher prices, but with excellent quality.

"A possible increased demand from Russia could be covered by a small volume from Chile, but certainly it could lead to niche opportunities in the Russian market."

Photo: Chilean Walnut Commission

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