EkoNiva as milk producer: is it possible and does it make sense to export milk products?

Transcription

1 EkoNiva as milk producer: is it possible and does it make sense to export milk products? Stefan Duerr, Hannover, 16 th November 2016

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3 EkoNiva APK The largest producer of raw milk in Russia 7 regional enterprises Farmland: approx ha Approx head of cattle, incl dairy cows Approx. 620 tonnes of milk per day

4 EkoNivaAgro, Voronezh Farmland: approx ha Approx head of cattle, incl dairy cows 450 tonnes milk per day Sale of pedigree cattle Stand:

5 Sibirskaya Niva, Novosibirsk Farmland: approx ha head of cattle, incl dairy cows Stand:

6 Zaschitnoe, Kursk Farmland: ha head of cattle, incl. 600 dairy cows Focus on seed production Stand:

7 Mezhduretshie, Tyumen Farmland: approx ha head of cattle, incl dairy cows Stand:

8 Farmland: approx ha Specialization on crop production Severnaya Niva, Orenburg Approx head of beef cattle Specialization on lentil, durum wheat, chick-peas Stand:

9 Kaluzhskaya Niva, Kaluga Farmland: approx ha head of cattle, incl dairy cows Milking robots Stand:

10 Savinskaya Niva, Kaluga Organic agriculture (Certified by European standards) ha of farmland head of beef cattle Stand:

11 Milk processing Academy of milk sciences Start with own milk processing in Voronezh region from June 2016

12 Our milk production 12

13 Housing systems Simple reconstruction, milk pipeline, costs per stall approx. 700 EUR Labour costs per kg milk 5 Eurocent Significant reconstruction, dairy parlour, costs per stall approx EUR Labour costs per kg milk 3 Eurocent Modern dairies, rotary milking parlour, robots (in Kaluga), costs per stall approx EUR Labour costs per kg milk 1,5 Eurocent 13

14 Breeds Local cattle (red and white, black and white, Simmental) Simmental Brown Swiss Holstein Friesian 14

15 Feeding Own feed production Total mixed ration, 3 lactating groups, dry cows, transit group Ration calculation in accordance with the content of fiber and starch in the forage (NDF is the primary parameter). Forage corn silage, alfalfa haylage, clover, sainfoin, cereal grasses. Grass haylage Concentrated feed Corn for grain, barley, soy meal, rape meal, lupine, molasses, beet pulp 15

16 Heifer Raising Open-air housing is a principle; cold housing in Siberia 2 months in individual hutches 2 months in group igloos Housing in large groups at open-air facilities; recently often at pastures 16

17 Milking Milk pipeline Side-by-Side Rotary Milking robot 17

18 Milk quality Average butter fat of the milk delivered to processing plants 3,9 %, average protein content 3,4 % Average somatic cell count 200 thsd. Average bacterial count 50 thsd. The majority of milk produced by the company is delivered as highest class milk, part of the milk is used for production of baby food and cheddar cheese. 18

19 Is it possible to export milk products from Russia? 19

20 Agricultural sector of Russian Federation

21 Auxiliary farming 21

22 Traditional agricultural cooperatives 22

23 Primitive Family Farms 23

24 Modern Family Farms 24

25 Large modern agricultural holdings 25

26 Large agricultural holdings in Russia

27 Could we export milk from Russia? Milk production in Russia Russian producers deliver approx mio. tonnes of milk per year to processing plants A dramatic decrease in production of milk by auxiliary farms A dramatic decrease in production of milk by traditional agricultural cooperatives Small development of family dairy farms Intensive development of dairy farming at modern holdings (approx. 3 mio. tonnes of milk per year) However, in total no increase in milk production 27

28 Could we export milk from Russia? Comparison of costs for milk production in Germany and Russia Eurocent per 1 kg milk Weser Ems, modern farm ( dairy cows) Russia, modern dairy farm in Central Black-Earth region (2000 dairy cows) Feed 14,7 10,00 Labour costs 5,0 3,00 Other operating costs 3,0 2,80 Herd replacement 4,9 4,20 Depreciation, interest cost (including subsidies) 3,0 4,50 Overhead costs 0,8 2,50 Total per 1 kg milk sold 31,4 27,00

29 Milk: Cost comparison Russia and Germany Significant cheaper feed cost in Russia (rough and concentrate). Mainly due to cheaper land cost Cheaper labor in Russia Investment cost for building and equipment on same level Financing cost on same level due to higher interest subsidies in Russia Higher investment cost for cattle in Russia Less widespread professional knowledge in Russia Advantage Russia Balanced Advantage Germany

30 Is it possible to export milk products from Russia? From cost side, Russian raw milk would be competitive costwise on the world market There is no surplus in milk in Russia un the next 5 years Low efficiency in processing capacity in Russia for commodity production 30

31 Does it make sense to export milk from Russia? 31

32 Price, Eurocent/kg without VAT Development of milk prices on the world market 50,0 45,0 40,0 35,0 36,5 36,4 40,8 43,9 40,7 35,8 34,4 30,6 31,9 37,7 40,0 36,6 33,6 31,5 34,3 33,8 32,9 32,1 32,2 32,9 30,0 25,0 20,0 15,0 10,0 5,0 0,0 Jan 15 Feb 15 Mrz 15 Apr 15 Mai 15 Jun 15 Jul 15 Aug 15 Sept 15 Okt 15 Nov 15 Dez 15 Jan 16 Feb 16 Mrz 16 Apr 16 Mai 16 Jun 16 Jul 16 Aug 16 Granarolo (North) (Italy) Nordmilch/DMK (Germany) Danone (France) USA (North Amerika) Fonterra (New Zeeland) EkoNiva An average price for 1 kg milk without VAT, standard weight (fat 3,7%, protein 3,2%)

33 Comparison of costs for milk production in Germany and Russia without subsidies Eurocent per 1 kg milk Weser Ems, modern farm ( dairy cows) Russia, modern dairy farm in Central Black-Earth region (2000 dairy cows) Feed 14,7 10,00 Labour costs 5,0 3,00 Other operating costs 3,0 2,80 Herd replacement 4,9 4,20 Depreciation and interest rate, without subsidies in Russia 3,0 10,00 Overhead costs 0,8 2,50 Total per 1 kg milk sold 31,4 32,50

34 Does it make sense to export milk from Russia? Without investment and interest rate-buy-down subsidies, milk production in Russia is not competitive on world market Is it worth to spend Government subsidies to support production, which goes to export? Milk production for export creates working places and income to Russian countryside and hence may justify according subsidies Over the years interest rate in Russia may decrease and efficiency in Russian milk production will increase. Hence Russian milk production will be competitive on world market even without subsidies 34

35 Which milk products could Russia export? Commodities (milk powder, butter, cheddar) Branded products (cheese) 35

36 Influence of embargo No influence on row milk prices due to opened world market Big advantage for processing 36

37 Popularization of Dairy Farming Academy of milk sciences 37

38 Thank you for your attention!