Market report ¦ IDM
a countermeasure, Russia imposed import
bans on agricultural products (including
dairy products) from the EU. In
December 2019, the EU announced the
extension of sanctions until the end of
July 2020. Before the sanctions Russia
was the fourth-largest trading partner
of the EU, and the EU was Russia’s most
important trading partner.
As a result of the economic sanctions,
EU dairy export to Russia has
disappeared. The last full year of export
activity unaffected by sanctions
was 2013 when the EU exported dairy
products to Russia with a value of ca.
EUR 1.4bn. In 2013, EU butter (30,020
tons, some 30% of total EU butter
export), cheese (257,198 tons, nearly
33% of total EU cheese export), skim
milk powder (21,263 tons, some 5% of
total EU SMP export) and whey powder
(25,459 tons) exports to Russia represented
1.6%, 2.9%, 1.9% and 1.6%
of respective EU dairy production. In
terms of importance, the cheese export
represented the largest part of the EU’s
dairy trade towards Russia. The largest
EU dairy exporters were Finland,
Netherlands, Lithuania, Poland and
Germany. Italy was the ninth most important
exporter to Russia within the
EU. Since the Russian export ban, the
United States has become the EU’s largest
market for both butter and cheese
(a market which has recently been impacted
by the introduction of additional
import tariffs, more on this later).
As a result of the sanctions, Russia
has increased its internal dairy production,
however, the increase in production
was not enough to fill the gap, and
to reach a self-sufficient domestic dairy
industry. Therefore, Russia has still been
relying on dairy imports – although at
lower volumes – now predominantly
from Belarus (e.g., in 2018, the cheese
import from Belarus was 83% of total
Russian cheese import).
Following the introduction of economic
sanctions, the EU dairy products
destined for Russia had to find other