Russian Agricultural Bank sees Arab countries becoming new market for agribusiness exports

MOSCOW. June 19 (Interfax) - Geopolitical events and changes in the flow of foreign trade have made Arab countries one of the main markets for Russian agribusiness exports, a study by Russian Agricultural Bank's (RusAg) industry expertise center presented at the St. Petersburg International Economic Forum said.

This market includes 22 countries to which Russian agribusiness exports amounted to $6 billion in 2022, or 14% of the total. The bank's analysts identified five countries with potential for accelerated growth of exports from Russia.

The main market is Egypt, which accounted for $2.2 billion or 37% of Russian agribusiness exports to the region. Egypt, Saudi Arabia, Algeria, Libya and Sudan were the top five importers of food from Russia, with a combined $4.8 billion or 81% of the total exported to Arab countries.

After analyzing shipments since the start of 2023 compared to the same period of 2022, the analysts identified new promising markets in the region, including the United Arab Emirates, Sudan, Yemen and Oman.

In the first five months of 2023, agribusiness exports to Yemen surged by 10.5 times to $220 million and exports to the UAE jumped 175% to $110 million, whole Oman became a new market, importing products worth $40,000.

"Russian exporters have a wealth of experience working in the Arab world, so diversifying shipments to new markets should not be a big problem. The similarity of the food needs of these countries and the needs of those to which exports have already been established will be a plus," the head of the center, Andrei Dalnov said.

The most popular product groups in Arab countries were cereal grains, which accounted for 72% of total agribusiness exports; animal and vegetable fats and oil (19%); meat and edible by-products (4%); milled grain products (1%); and vegetables and certain edible root vegetables (1%), the study found.

Russian wheat exports to the region amounted to $3.9 billion or 66% of total agribusiness exports in 2022; sunflower oil exports amounted to $0.6 billion or 10%; soybean oil exports came to $0.5 billion or 8%; barley exports amounted to $0.3 billion or 6%; and chicken parts amounted to $0.1 billion or 3%.

Russian imports from these countries were also led by Egypt, which supplied $0.69 billion of agribusiness products to Russia in 2022, or 71% of all such exports from Arab countries. Imports amounted to $0.19 billion or 20% from Morocco, $0.03 billion or 3% from the UAE, $0.02 billion or 2% from Saudi Arabia and $0.01 billion or 1% from Tunisia.

Fruits and nuts made up 58% of these imports, vegetables and certain root vegetables accounted for 29%, fish and other seafood made up 4% and coffee and tea accounted for 3%.