Russia’s focus on organic agriculture

On 29 May 2018, a press conference took place in the Russian Federation dedicated to the 5-year anniversary of the National Organic Union. Participants of the conference discussed the latest developments in the sector of organic products in Russia and expressed their expectations of the draft Federal Law on “Organic Products, Production and Marketing” and raised some problematic issues. The Union organizes on 23 and 24 June another conference on organic agriculture in Suzdal.

Nowadays, the National Organic Union has become a leader of the Russian organic movement and unites almost all producers of organic products. Their main task is to promote the development of organic agriculture and its market of organic products in Russia as well to support producers and to create a legislative basis for organic products and its production and consumption.

Organic production and certification

In just ten years (2005-2015), the area of organic agricultural land in Russia has increased from 6.900 hectares to 385.140 hectares, which amounts to only 0.2% of the total agricultural land in the country. But not all certified organic land is under cultivation, which is partly due to the fact that certification takes about three years and farmers do not start using the land until they can produce and sell certified organic products.

Most organic farms in Russia are small and medium of size (50-1500 hectares), while the biggest share of the organic production is done by large holding companies such as Agrivolga, Arivera and  Savinskaya Niva. More than 60 Russian organic producers have international organic certificates from the European Union and of the National Organic Program of the US. The certification is voluntary; visit also the website.

Organic market

According to data of the National Organic Union, in 2016 the main organic products produced by the companies were grains (23%), fruit and vegetables (22%), dairy products (13%) and meat and meat products (11%). Due to the fact that in Russia organic products are several times more expensive than non-organic ones, the largest markets for this sector are in Moscow and Sint Petersburg. These two markets account for more than 70% of total sales. Moreover, usually organic products have a shorter shelf life and cannot be transported over long distances. Furthermore, Russia also has the potential to become one of the major exporters of organic feed material in future.

The retail sector for organic is represented by premium supermarkets like Azbuka Vkusa and Globus Gurme, small health food shops (Gorod Sad, LavkaLavka), specialized organic products shops (Organic Market, Biostoria), online shops of larger agriholdings like Arivera and larger healthy food shops like Ecotopia.

The Russian market of organic products has seen quite a growth till 2014; on average 10% annually since 2010. In 2015 and 2016 annual increase of the market slowed down to about 4%, because of the less favorable economic situation in Russia. In 2016 the organic market in Russia amounted to 160 million USD. Initially all organic products present on the market were imported from for example France, Germany and Italy. However, this has changed and in 2016 the share of domestic certified organic products reached 10%. Around 95% of the total investments in Russia in organic production are private.

New legislation on organic

The draft Federal Law on Organic Products, Production and Marketing is still under consideration at the State Duma where it has passed the first reading. The Law will cover main definitions in the sector such as “organic products”, “organic production” and “distribution”. The most important part of the draft Federal Law is that it will prohibit labeling and the distributing of ‘organic products’ that have been produced at a facility which has not been certified as organic.

It’s quite a challenge for producers of organic products to operate at the Russian organic market due to the following reasons: often consumers don’t make difference between organic products and other so called “healthy” products; lack of well-trained and qualified personnel as there are no specialized university courses for specialists in the field of organic agriculture; lack of knowledge and experience in organic production among the farmers themselves and difficulties with logistics for small and medium producers.

Most stakeholders in the Russian Federation believe that the organic agriculture sector needs a national strategy with a clear development and support plan. Based on research and market data, it should be defined whether Russia should focus only on local consumption, export or even on both directions.