Record high potato prices in Russia

Russia has experienced its lowest level of inflation for a quarter of a century, but the prices of the borscht set of vegetable have increased substantially. Potatoes have hit record high prices due to supplies being imported and a lack of vegetable storage.

According to Rosstat data, since the beginning of the year potatoes, carrots and cabbage rose in price by 40, 37 and 24 percent respectively. In June, potato broke records for its increase in price, in less than one month, it increased by 3.4 percent.

While onions, cucumbers and tomatoes decreased in price.

The increase in potato prices is connected to the fact that most of the supplies are imported, explains the Director of the Institute of Agricultural Marketing (IAM) Elena Turina. The main suppliers of potatoes to Russia are Egypt and Belarus.

Russia’s domestic production of vegetables begins to be harvested at the end of July. The main supply comes from August to October.

Elena Turina, Director of the Institute of Agricultural Marketing (IAM):

‘’As there is not enough storage in Russia, domestic producers are not able to keep their harvest to the next collection.’’

A similar situation exists with the other vegetables of the borsch set. According to experts, potatoes prices usually begin to fall in price in June, ahead of the glut on the market. But 2016 is an exception. Experts attribute this to the fact that last year Russian producers gathered a very large crop. Because of this, domestic prices of potatoes strongly "sunk".

Now the supply has run out and supplier are forced to buy expensive import potatoes.

Another factor that pushed prices up, is the high demand for potatoes. According to the Central Bank, retail sales of potatoes in the first quarter of this year increased by 28 percent compared with the same period last year. Increased demand has been associated with a fall in the purchasing power of the population, says the regulator.

The Central Bank predicts a repeat of the situation this year.

According to Elena Turina, further changes in prices for fruits and vegetables are associated with the forecasts for the harvest. The better the expectations of the farmers, the more the prices fall.

Elena Turina:

"In the coming months the traditional fall in cucumber, tomato and fruit prices takes place. And then for vegetables grown on open ground. Prices for most products will stay the same."