September 1 2006, 13:08

Cheap canned produce from Ukraine can saturate Russian market

According to information of the market monitoring service, conducted by "Agrooglyad: Vegetables and Fruits" journal, unique for Ukraine periodical of the produce business, many modern canneries are facing this year an untypical problem - it is difficult to sell canned commodities.

To the opinion of experts of the Agricultural Marketing Project, this problem was predictable. First of all, the quantity of canneries is increasing year by year in Ukraine; and they used to build up vegetable processing capacities nearly each year. Second, after two off years the yield of vegetables at last has reached the normal level and even exceeded it. The thing is, more farmers apply modern intensive technologies of vegetable production. And, the cultivation areas for most vegetable crops (utilized for processing needs) have reached top record in 2006. We anticipated this situation as early as in April-May.

In the conditions of excessive supply of raw materials, canneries have already achieved or even overachieved their plans for vegetable canning. Though, the season of vegetable canning has not been finished yet. At the same time, many canneries experienced failures during two previous years. So they did not sign contracts for produce sales fearing for the deficit of raw materials. As a result, the canneries are starting to look for buyers right now.

The cannery industry of Ukraine (its produce segment in particular) is clearly oriented on Russian market. Most producers are looking for contacts exactly in this country, and also in Belarus and other CIS countries. Ukrainian market will hardly be able to consume more than one third of the produced canned commodities. And, to the opinion of the experts of the Agricultural Marketing Project, the volumes of home-canned commodities is likely to stop reducing this season for the first time during previous years. Most probably, Russian wholesalers and retail chains will use this opportunity and purchase larger volumes of Ukrainian canned vegetables this season. The commodities of Ukrainian origin have a chance to force Russian and Polish products out of supermarket shelves.

There is a splendid opportunity to find new buyers for the products canned by Ukrainian processing enterprises - the largest in Russia international conference "Produce Business in Russia 2006" will be held October 17-18 2006 in Moscow. And, Russian companies will have a unique opportunity to find suppliers in Ukraine during the third international conference-exhibition "Fruits and Vegetables in Ukraine 2006. Open Market" to be held December 5th-6th 2006 in the National Complex "Expocenter of Ukraine" in Kyiv. The products manufactured by more than 150 companies will be introduced to exhibition participants; in total, not less than 5,000 participants will attend the event.