BISNIS - NIS Agribusiness Report

01 SEP 95

FM AMCONSUL ST PETERSBURG


FARMERS AND POLITICIANS CONVERGE ON ST. PETERSBURG


1.SUMMARY: THE "RUSSIAN FARMER-95" EXHIBIT AND FAIR OPENED IN ST. PETERSBURG ON AUGUST 28, BRINGING IN A HOST OF DIGNITARIES, MANY, SUCH AS PRIME MINISTER CHERNOMYRDIN, OBVIOUSLY SENSING A GOOD OPPORTUNITY FOR CAMPAIGNING. A HUGE FARMERS MARKET GAVE FARMERS AND PEASANT COOPERATIVES A CHANCE TO SELL THEIR PRODUCE WHILE MANUFACTURERS AND DISTRIBUTORS EXHIBITED FARM EQUIPMENT AS WELL AS EQUIPMENT FOR THE WHOLESALE AND RETAIL FOOD SERVICE INDUSTRY. END SUMMARY.

2. WITH THE LOOK AND FEEL OF A STATE FAIR IN THE UNITED STATES (INCLUDING THE CARNIVAL RIDES), THE FOURTH ANNUAL AGRICULTURAL FAIR AND EXHIBITION, "RUSSIAN FARMER-95" OPENED IN ST. PETERSBURG ON 28 AUGUST. A NUMBER OF LOCAL, NATIONAL, AND INTERNATIONAL DIGNITARIES, INCLUDING DEPUTY PREMIER ALEKSANDR ZAVERYUKHA, ST. PETERSBURG MAYOR SOBCHAK, AND LENINGRAD OBLAST GOVERNOR BELYAKOV, AS WELL AS DEPUTY PREMIERS FROM UKRAINE, GEORGIA, ARMENIA, AND UZBEKISTAN PARTICIPATED IN THE COLORFUL AND FESTIVE OPENING CEREMONIES. WHILE OTHER DIGNITARIES, INCLUDING PRIME MINISTER CHERNOMYRDIN, VISITED LATER IN THE WEEK.

3. THE PRESIDENT OF THE RUSSIAN ASSOCIATION OF PEASANT AND FARM HOLDINGS (AKKOR), VLADIMIR BASHMANCHIKOV, IN IMPASSIONED OPENING REMARKS, CONGRATULATED THE FAMILY FARMERS OF RUSSIA FOR STAVING OFF OF PREDICTED FAMINE IN THE COUNTRY. HE SAID THE MAIN PROBLEM FACING PRIVATE FARMERS TODAY IS THE LACK OF MEANS TO EFFICIENTLY EXPLOIT THE COUNTRY'S RESOURCES BUT SOUNDED UPBEAT ABOUT THE PROSPECTS FOR THE FUTURE OF PRIVATE FARMING.

4. LIKE STATE FAIRS IN THE UNITED STATES, POLITICIANS OBVIOUSLY SENSED THIS AS AN OPPORTUNITY TO SCORE POINTS WITH VOTERS AND PUSH FAVORITE CAUSES. MAYOR SOBCHAK, FOR EXAMPLE, USED THE OCCASION TO PITCH FOR SUPPORT FOR LAND PRIVATIZATION, SAYING IT WAS THE KEY TO AGRICULTURAL DEVELOPMENT AND TO ECONOMIC PROGRESS IN RUSSIA. HE URGED THE AUDIENCE TO BACK ONLY POLITICIANS AND PARTIES IN THE UPCOMING ELECTION WHO SUPPORT PRIVATIZATION OF LAND. HE ALSO POINTED OUT THAT WHILE THE CITY WENT TO CONSIDERABLE EXPENSE TO BRING THE EXHIBIT BACK TO ST. PETERSBURG, IT BENEFITED CITY RESIDENTS BY MAKING FOOD MORE AFFORDABLE AND AVAILABLE.

5. ON THURSDAY, 31 AUGUST, PRIME MINISTER CHERNOMYRDIN VISITED THE EXHIBITION, AND ON THE MORNING OF HIS VISIT THE ROAD LEADING FROM THE AIRPORT AS WELL AS THE AVENUE LEADING TO THE FAIR WERE SUDDENLY DECKED WITH COLORFUL PLACARDS PROCLAIMING HIS ELECTORAL BLOC, OUR HOME IS RUSSIA (NDR). IN AN EFFORT TO COURT THE FARM VOTE, CHERNOMYRDIN MINGLED WITH THE FARMERS, SHARPLY CRITICIZED THE AGRARIAN PARTY'S PLATFORM FOR BEING OPPOSED TO PRIVATE LAND OWNERSHIP, AND PROMISED FINANCIAL SUPPORT TO FARMERS IN THE 1996 BUDGET, ACCORDING TO LOCAL PRESS REPORTS. CHERNOMYRDIN CREATED WHAT ONE NEWSPAPER DESCRIBED AS A "MINI SENSATION" WHEN HE SAID THAT IF THE LAND QUESTION WERE NOT DECIDED IN THE NEAR FUTURE BY THE GOVERNMENT AND THE DUMA, THEN IT SHOULD BE DECIDED BY A NATIONWIDE REFERENDUM. THE PRESS ALSO REPORTED THAT HE PROMISED A SPOT ON THE NDR PARTY LIST TO BASHMANCHIKOV.

6. FOR MANY LOCALS, HOWEVER, THE PRINCIPLE ATTRACTION OF THE FAIR WAS NOT THE POLITICAL LUMINARIES IN ATTENDANCE BUT THE OPPORTUNITY TO DO A LITTLE SHOPPING. DOZENS OF BOOTHS FROM VARIOUS AGRICULTURAL ORGANIZATIONS, SUCH AS THE SMOLENSK OBLAST AGRICULTURAL COOPERATIVE, THE UNION OF FARMERS OF LENINGRAD OBLAST, THE VOLGAGRAD ASSOCIATION OF PEASANT FARMERS, AS WELL AS THE USDA SUPPORTED PRIVATE FARMERS WERE WELL STOCKED AND DOING A BRISK BUSINESS SELLING A VARIETY OF AGRICULTURAL PRODUCTS, INCLUDING MEATS, VEGETABLES, AND PLANTS.

7. INSIDE THE EXHIBITION HALLS THERE WERE REPRESENTATIVES FROM A LARGE NUMBER OF FIRMS--FROM USSIA, OTHER CIS COUNTRIES, THE BALTIC STATES, JAPAN, THE UNITED STATES, AND OTHER WESTERN COUNTRIES--DEMONSTRATING THE LATEST IN FARM TECHNOLOGY AS WELL AS A WIDE VARIETY OF OTHER PRODUCTS FOR THE FOOD PROCESSING INDUSTRY, WHOLESALE AND RETAIL FOOD DISTRIBUTORS, AND FOOD SERVICE. EXHIBITS FEATURING MICROBREWERY EQUIPMENT AND DONUT-MAKING MACHINES WERE AMONG THOSE GENERATING THE MOST INTEREST WHEN POLOFF VISITED THE EXHIBITION, OFFERING HOPE FOR FURTHER VARIETY IN THE LOCAL FOOD AND BEVERAGE OUTLETS.

8. A LARGE NUMBER OF FOREIGN FIRMS OFFERING MEAT AND PRODUCE WERE AT THE FAIR, APPARENTLY HOPING TO CAPTURE A SHARE OF WHAT APPEARS TO BE THE RISING DEMAND FOR HIGH QUALITY FOOD. SOME RUSSIAN FIRMS ALSO APPEAR POISED TO COMPETE IN THIS MARKET, AND A FEW HAD DISPLAYS THAT RIVALED THOSE OF WESTERN COMPANIES IN TERMS OF ATTRACTIVENESS AND TASTINESS OF THE PRODUCTS BEING OFFERED. FOR EXAMPLE, A BOOTH SET UP BY PARNAS, A ST. PETERSBURG MANUFACTURER OF SAUSAGE AND DELI-STYLE MEAT, WAS ONE OF THE MOST CROWDED EXHIBITS, WITH A DISPLAY EVERY BIT AS ATTRACTIVE AS NEIGHBORING DISPLAYS FROM FINNISH AND GERMAN FIRMS.

9. COMMENT: THE FAIR AND EXHIBITION REPRESENTED BOTH WHAT IS HOPEFUL IN RUSSIA'S AGRICULTURE AND THE FOOD INDUSTRY AS WELL AS WHAT STILL NEEDS IMPROVEMENT. JUDGING BY THE LARGE NUMBER OF DISPLAYS TARGETED AT RESTAURANTS AND STORES CATERING TO THOSE DEMANDING BETTER FOOD AND MORE VARIETY, THE FOOD RETAIL AND FOOD SERVICE SEGMENTS, WHICH ALREADY HAVE MADE SIGNIFICANT ADVANCES IN RUSSIA IN RECENT YEARS, APPEAR POISED TO MAKE EVEN FURTHER STRIDES. IT ALSO IS ENCOURAGING TO SEE OFFICIAL RECOGNITION OF THE IMPORTANT ROLE RUSSIA'S SMALL BUT GROWING NUMBER OF PRIVATE FARMERS IS PLAYING IN THE RUSSIAN ECONOMY AND TO SEE POLITICIANS COURTING THEIR VOTE. MEANWHILE, FARMERS AND PEASANTS OBVIOUSLY RELISHED THE OPPORTUNITY TO SELL THEIR PRODUCE AND GLIMPSE THE SPARKLING EXHIBITION OF WESTERN FARM EQUIPMENT. THE SHARP CONTRAST BETWEEN THE HIGH PRICES ON THIS EQUIPMENT AND THE OBVIOUSLY LIMITED MEANS OF THE FARMERS WAS STRIKING, HOWEVER, AND SUGGESTS THAT FARMERS WILL CONTINUE TO PRESS FOR TAX RELIEF AND GOVERNMENT SUPPORT, ESPECIALLY TO GAIN ACCESS TO CREDIT.