The European flour millers in South Russia & Black Sea region

A delegation of European flour millers went to Krasnodar in September 2014. The region is a key Winter wheat-growing area and is known as the grain basket of Russia. The objective was to improve knowledge and see whether its potential can answer structural needs of European flour millers in high-quality bread-making wheat over the long run.

In the coming years, the Russian authorities intend to double Russia’s annual grain exports from the current 20 million tonnes (t): the amount of grain that could be shipped from Southern Russia could be increased by 7-8 million t per year, and by as much as 10 million t from the Russian Far East. But the existing facilities for handling grain may not be enough.

Overview of Russia grain market, logistics and high-quality wheat

SovEcon briefed the European delegation on Russia wheat, rye & oat production, trade and forecasts but also the main exporting companies & logistics and the local wheat quality & standards.

Visit of the grain installations of Novorossiysk

Novorossiysk, the largest Russian sea port in the Black Sea (11.5 million t a year) and its Kombinat Stroykomplekt (KSK) opened its doors to the delegation of the European flour millers. Three terminals can load Panamax-sized vessels (74 000t) and grain is delivered to all of them both by trucks and by railroad. KSK was launched in 2006 and it is the third largest grain terminal in the Black Sea region of Russia. The visit is completed by an exchange on wheat inspection at the port laboratory of Inspectorate R.

Visit of the Agroholding Kuban farm & flour mill in Ust-Labinsk

The European flour millers’ delegation visited the Agroholding Kuban farm, one of the largest agribusinesses in the South of Russia, employing over 4 800 people. In particular, it integrates two modern dairy mega farms, a 16 000 pig capacity breeding complex, three elevators with non-recurrent grain storage capacity more than 270 000 tonnes, three modern seed plants, a sugar factory and one of Russia’s best horse breeding farms.

In Russia, which is one of the major worldwide wheat producer, there are more of 300 and up to 5 000 mills if we consider all small companies. According to Rosstat, the country processes between 9 and 10 million tons of flour each year. Bread consumption is said to be rather stable at a level of about 120 kg per capita against around 65 kg per capita in the EU.

Meeting with Kuban State University, KrasnodarZernoProduct-Expo and leading trading companies

The Kuban State Agrarian University is one of the recognized leaders in higher agricultural education in Russia. It is also the largest university in the south of Russia.

Krasnodarzernoprodukt Group (KZP) is one of the largest grain & oilseeds handling facility in Krasnodar region, employing over 2 000 people. KZP aims at building up a vertically integrated business – from the production & storage of agricultural raw materials to the delivery of finished products to the final consumer.

The European delegation exchanged with professionals from Glencore, AK Osnova and Mirogroup about import issues and possibilities of Russian high-quality wheat. All presentations are available for members upon request.