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RT.com, Aug 23, 2016

Polish apple growers' protest on Nov 4, 2014 demanding more gov't aid after embargo on their product was introduced by Russia (Kacper Pempel, Reuters)

Polish apple growers’ protest on Nov 4, 2014 demanding more gov’t aid after embargo on their product was introduced by Russia (Kacper Pempel, Reuters)

Poland is expecting a record apple harvest, but growers are having difficulty selling their produce and even face bankruptcy. Before the trade dispute with the EU, Russia accounted for more than half of Polish apple exports.

“The situation in the Polish apple market is rather difficult. Poland’s growers have been hit hardest by the [Russian] embargo,” said Anna Staszewska, an export specialist at EUROSAD, in an interview with the Financial Times. EUROSAD unites more than 30 farms and 700 hectares of orchards in the country.

Poland produces more than 30 percent of all European apples, and the country is expecting 3.5 million tons this summer. But the record harvest is hurting prices, which are at one zloty (€0.23) a kilo for dessert apples and €0.05 a kilo for industrial apples. This is a 20 percent drop since 2011, according to FT calculations.

“On one hand the higher harvest is a success. But at the same time, it poses a huge challenge for Polish farmers… There is no profit with the market in this situation,” said food and agribusiness analyst at Bank Zachodni WBK, Grzegorz Rykaczewski.

“We feel anxious about the situation. If it continues, and there will be a lot of apples and the prices will be low, I think that farms will start to go bankrupt,” said the owner of Fresh Fruit Services Marcin Hermanowicz.

The EU imposed sanctions on Russia after accusing Moscow of involvement in the military conflict in Eastern Ukraine and after Crimea voted to rejoin Russia. The Kremlin responded by imposing an embargo on agricultural produce, food and raw materials against countries that joined anti-Russian sanctions.

After the Russian embargo was imposed, the Polish government started a campaign to eat apples ‘against Putin’, which increased consumption, but after a while apple sales in Poland returned to normal.

Read also:
Moscow extends contraband food destruction, RT.com, Aug 12, 2016

Polish-Russian bilateral trade in 2015. In 2015, Polish-Russian bilateral trade volume decreased by 40% and reached 19.7 billion USD compared to 32.8 billion USD in 2014.

From the Observatory of Economic Complexity:

Poland is the 24th largest export economy in the world and the 24th most complex economy according to the Economic Complexity Index (ECI). In 2014, Poland exported $205B and imported $218B, resulting in a negative trade balance of $12.8B. In 2014, the GDP of Poland was $544B and its GDP per capita was $25.3k…

The top import origins of Poland [year 2014] are Germany ($51.3B), China ($22.5B), Russia ($17.7B), Italy ($12.3B) and the Netherlands ($8.57B).

From Trading Economics:

From the beginning of the past decade, Poland’s foreign trade turnover increased almost ten-fold. Poland exports processed fruit and vegetables, meat, dairy products, electromechanical products, vehicles, aircraft and vessels. Most of Poland’s imports are capital goods needed for industrial retooling and for manufacturing inputs like machinery and transport equipment, chemicals, minerals, fuels and lubricants. European Union is by far its largest trading partner accounting for about 79% of exports and 64% of imports. This page provides the latest reported value for – Poland Balance of Trade – plus previous releases, historical high and low, short-term forecast and long-term prediction, economic calendar, survey consensus and news. Poland Balance of Trade – actual data, historical chart and calendar of releases – was last updated on August of 2016.

Exports to Russia are of no great importance to Poland, by Martyna Kośka, Central European Financial Observer, Aug 19, 2016

… This does not mean that fruit growers coped with all the consequences of the Russian embargo. In 2015 they managed to sell only half of the country’s apple production, and this year they will also not manage to sell everything. Mirosław Malinowski, the President of the Fruit Growers Union, points out that there are no reasons for optimism. “In fact, there were no problems with the sale of apples only because we withdrew a huge quantity thanks to the special assistance mechanism of the European Union, the so-called food banks, the increase in the price of apple concentrate as a result of huge exports to the United States and the Russian Federation, and shipments to the countries of Eastern Europe. Also, thanks to selling at very low prices in other markets.”

Poland is today the third largest producer of apples in the world (after China and the USA) and it cannot be ruled out that it will soon occupy second place, so it must guarantee for itself new places where it can sell the fruit. The best prospects seem to be the rapidly growing Asian market.

Despite the involvement of representatives of the Ministry of Agriculture in the negotiation process, giving credibility to Polish fruit growers, it is not at all an easy task to convince new clients to buy large quantities of Polish fruit…

Poland-Russia trade, Jan-May 2016

 

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