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Russia: Local growers find it hard to compete against the import

Flower growers have suffered not only from the pandemic. Officially, the sphere has not been recognized as an affected one, even though during the first lockdown millions of cut flowers had to be disposed of. The growers are attacked by the foreign producers. Apart from exotic varieties, traditional flowers are also being imported, such as carnations, tulips and roses.

Those who believe that Russian market is invaded by the flowers from the Netherlands only, are mistaken. Produce from various countries can be found in the flower shops, such as the USA, Columbia, Italy, Spain, Mexico, etc. Although, lockdowns and respective regulations have brought changes. According to the deputy head of Department of Federal Service for Veterinary and Phytosanitary Surveillance for Saint Petersburg, Leningrad and Pskov regions, Mr. Oleg Emtsev, the import volume in 2020 has decreased five times.

According to the information by the committee on the agriculture of Leningrad region, roses are grown in the local greenhouses all year round. In 2020, 33.6 million pieces were grown, 35.2 million pieces are planned for 2021. Roses are the main flowers grown in Russian greenhouses. Some complexes produce chrysanthemums and gerberas but their quantity is insignificant in comparison with the tons of imported flowers. Carnations that Soviet greenhouses boasted once are currently not profitable. The prices on imported ones are low and Russian producers cannon compete with them.

Mr. Aleksey Antipov, the co-owner of New Holland, the biggest flower-producing greenhouse in Leningrad region, explains that the ratio of locally grown roses to the imported ones in flower shops reaches 15-20%.

“How do we survive? With great difficulty. It seems that the government is giving green light to foreign producers. The custom duties have been decreased from 15 to 5 per cent; they have become the lowest in the world. The Belarusian scheme is in action again, all the flowers are being imported through Belarus, which does not apply VAT to flowers. Meanwhile, we pay all the required taxes. As for the demand, in will improve only with the increase of the personal income, which is currently rather low”, shared Mr. Antipov.

The regional government provides support to the enterprises growing vegetables, mushrooms and flowers in greenhouses. Last year over 837 thousand euro were provided, of which 174 thousand were allocated for rose production. However, it is not sufficient and many producers had to take a simple step of raising the prices.

“It is not worth counting on a significant increase in demand. Personal income is going down and flowers are not the prime necessity. The situation can be changed by introducing high custom duties on imported flowers. Another matter is energy costs. Greenhouses consume gigantic amounts of energy. Currently the rates are high and once they get down, the enterprises would feel at ease”.

In conclusion, in the current situation there can be no doubt that new enterprises will not appear, considers Mr. Anatoly Golov, co-chairman of the Customer’s Union of the Russian Federation.


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