The market

The Russian market for flower and vegetable crops is a promising yet under-developed sector of the real economy. The Russian producers are currently being squeezed out by western companies. The share of imports continues to rise steadily year on year. More than 70% of Russia’s seeds, 50% of its fresh vegetables and 90% of its flowers are supplied from other countries. At the same time, experts believe that the market share of Russian flower producers reaches 10% only on special holiday dates, when demand is high for all types of flowers.

 

The attraction for major Russian wholesalers of imported greenhouse products is explained by the predictable quality, wide range and high supply volumes.

 

In recent years the markets for flowers in Russia have displayed an interest and a readiness to work with local producers of quality and predictable products. That said, compared with imported equivalents, the majority (about 85%) of domestic greenhouse farms are low-technology, which is reflected in the low profitability of production.

 

Today it is important to introduce innovative technologies to organise an effective business, to ensure an optimum microclimate in greenhouses and, accordingly, high yields of quality produce. However, statistics indicate that only 18% of greenhouse farms in Russia use modern greenhouse designs and advanced technologies.

 

Specialists believe that there are two aspects that hinder development of the industry.
The first is that Russia is not competitive in domestic greenhouse technologies.
The second is that Russian producers cannot compete with importers, who implement a well-structured and aggressive marketing policy.

 

In the meantime, experts are convinced that creating own production capacity based on foreign technologies and an intelligent management of greenhouse projects will facilitate a predictable output of high-quality produce and a gradual replacement of imports.

 

Greenhouse production is one of the most profitable agricultural businesses, facilitating a predictable and controllable year-round closed-cycle output with a high payback period and broad potential for diversification, aspects which reduce the degree of financial risk.

 

The Russian market now benefits from a new stimulus for development, thanks to HTI GROUP’s introduction of new greenhouse projects.