Export

It is not all Lithuanian exporters that have been hit by the economic crisis and a decline in consumption. Export of chesses and live pigs to Russia even increased during the crisis, and the manufacturers hardly manage to export certain products. The amount of products exported to Latvia, which is badly suffering from the crisis, exceeds that of exported ones during the year 2008.

The decline is insignificant

During the first half of 2009, when the severe crisis made customers start saving in life, Lithuania’s export dropped by as much as 31 per cent as compared with that of the same period last year. However, no such fall has been observed in the market of agricultural products.
“Consumers most probably have refused goods that are not of basic necessity, however, they do not save at the expense of food. Even the Latvians who are going through a severe crisis do not choose foodstuffs of lower quality. Sufficiently stable export of Lithuanian agricultural products testifies to that”, spoke Vygantas Katkevièius, Director of the Department of Economy of the Ministry of Agriculture.
If last year agricultural products accounted for 15 per cent of the structure of total export during the first half year, this year this figure has increased by as much as 20 per cent. Hence, the demand for Lithuanian products in foreign markets did not decrease, though, of course, statistics were made somewhat worse by the fallen prices. This has affected not only Lithuanian manufacturers but also those of the whole world. It is the milk processors, in particular, who had to put up with the fall in prices”, added Vygantas Katkevièius.

Cheeses are the pride of industry

Lithuanian cheeses have been working their way to international markets for more than a decade. Every year more and more cheeses are exported. After the crisis had arisen even larger quantities of cheeses than those exported last year when consumption was dramatically increasing were exported. For example, during the first half year of the year 2009 a total of 32,9 thousand tons of cheeses were exported, whereas during the same period in 2088, this figure totalled 30,2 thousand tons.
“Lithuanian cheeses have become the main part of dairy products being exported. Long and hard work bore fruit, and even the crisis could not worsen the results”, summed up the Director of the Department of Economy of the Ministry of Agriculture Vygantas Katkevièius.
Lots of cheeses are sold not only in Russia but also in the countries of Western Europe. Some cheese products are unique, foreign countries have no analogues in their markets.

Restrictions are imposed

True, exporters of cheeses had to put up with a fall in prices of these products. Furthermore, the Russians are doing everything to protect their market; therefore they impose more and more requirements and restrictions on the importers. By the way, a lack of cheeses and other dairy products accounts for 30 per cent in Russia, however, their import is still sought to be restricted.
Recently the Russians proposed to the representatives of our country that an agreement on export balance should be concluded. According to this agreement, the amounts of products that could be imported to Russia should be equal to those imported from that country. Thus far the agreement has not been concluded. Besides, the Russians decided to increase import duties on cheeses. As of the end of September minimum Russian duties on cheeses will be increased by almost as much as EUR 200 per ton. However, these additional charges are expected to be covered by increasing subsidies for export of cheeses to the third countries.
“The increase in duties will cost the Lithuanian cheese manufacturers about EUR 5 million, if export indicators are similar to those of last year. We expect to cover this amount with the help of subsidies“, explained the Director of then Department of Economy of the Ministry of Agriculture Vygantas Katkevièius. True, subsidies for dairy products and beef being exported will be applied until the year 2013.
Quite a lot of Lithuanian capital companies operate in Kaliningrad region where poultry and fish are processed. Raw materials are taken there from Lithuania, which also improves the situation in the sphere of export considerably.

Live pigs – to Russia

Lithuanian pork has always been in demand in Russia. However, at the present time the Lithuanians export live pigs especially successfully. The amounts exported have increased from 60 million in 2008 to 100 million in 2009. “This is determined by the demand in Russia. Simply there is a lack of pork in Russia because the westerners have built modern processing enterprises in that country, but there is a shortage of raw material. Our manufacturers take advantage of this”, described the situation Vygantas Katkevièius.
Warnings of the Russians about their intention to ban import of pigs from the countries in which swine flu has been registered might put a spoke in the wheel of pig exporters. True, then it is unclear from where the Russians will import pigs because there are just a few countries in which not a single case of flu has been detected. Cases of the so-called swine flu have been diagnosed in Russia itself too.
Thus far Lithuanian pig breeders have nothing to worry about – they will surely have no problems on account of veterinary reasons. On the other hand, political decisions can reduce expectations of our exporters.

An increase in export to Latvia

“Latvia remains the second export partner of our agricultural products by importance. Neither the crisis nor Latvia’s difficulties have changed that” underlined Vygantas Katkevièius.
By no means, it turns out that during the first half year of this year the amount of agricultural products that we have exported to the neighbouring country is larger than that exported during the same time period last year (LTL 553 million and LTL 573 million, respectively).
Of course, the development of the Lithuanian trading centers in Latvia, which sell products made in our country, had the greatest impact on these achievements. Though a decrease in prices is strongly felt.

Old relations are of great importance

The Germans further remains a third export partner by size. True, exporters of agricultural products notice a decrease in export, however, old relations and an enormous market ensures that Germany will not fall out of the list of the most important countries to the exporters of agricultural products of our country.
Exported Lithuanian cheeses, carcass beef, which the Germans process into the end products in their enterprises, are in great demand in that country.
Estonia with its small market that follows Germany is also easily accessible to our exporters. The contribution of trades people is also significant there, besides, distances and small.
As has already been mentioned, products being exported are subsidized if they are exported to third countries. Inside the European Union such form of support is impermissible.