Avgust-Agro finds cushy site for grain hub in Tatarstan
The Russian agro-holding can drive out the oldest grain elevators of Kazan and start providing big cities’ bread factories with flour
As Realnoe Vremya learnt, Aleksandr Uskov’s Avgust-Agro company got the right to build a large grain elevator in Sviyazhsk, which will probably replace obsolete grain capacities in Kazan’s river port that’s waiting for renovation. The future complex of Avgust-Agro can double capacities of the Kazan port elevator, which belongs to Ilshat Khayrullin’s Edelweiss Corporation. The new elevator can also meet the needs of Kazan for bread baking in 2022 already. The total investments of the agricultural investor in the creation of warehouses are evaluated at 7bn rubles. Our newspaper’s sources in the Tatarstan Ministry of Agriculture and Food explain that the new infrastructure is built for the future — for future record harvests.
Why is a grain elevator in Kazan’s centre needed?
Aleksandr Uskov’s Avgust-Agro Russian agro-holding, which ranks sixth in grain harvest in the republic, is preparing to “put down roots” in agricultural processing of grain in Tatarstan. The company defeated Tatarstan agro-holdings in a fight for a project on a large grain elevator in Sviyazhsk that will highly likely replace Kazan’s port elevator after the renovation of the river port of the capital.
Sources that are close to the Tatarstan Ministry of Agriculture and Food confirmed this information for Realnoe Vremya.
“Think yourself, why is a grain elevator in Kazan’s centre needed? Sviyazhsk has ready infrastructure for it: a wharf was built, there are approaches for river ships to deliver grain,” Realnoe Vremya’s interlocutor explained the essence of the idea to relocate the grain warehouse from Kazan’s centre.
According to him, this elevator will accept the grain from Zelenodolsk, Verkny Uslon Districts in Tatarstan.
Director General of Avgust-Agro MC PLC Aydar Galyautdinov, in turn, confirmed to Realnoe Vremya that the project on construction of the Sviyazhsk elevator might receive firm financing.
“We have big plans next year too,” he said. “We will grow in all areas. Nowadays we are elaborating projects on construction of two elevators — in Sviyazhsk and Bugulma Districts with a storage capacity of 140,000 and 100,000 tonnes.
According to him, it is planned to start the construction next year. The launch is expected to be in 2022.
Sviyazhsk will cover Kazan’s renovation
The city’s authorities announced their intention to relocate the Kazan port elevator from the Kazan River Port but leave the facade of the building for the first time a few years ago. This August, the Tatarstan president was again presented the port zone’s renovation project, which experts consider didn’t have “a great novelty except for the form of buildings and facades”.
But the relocation of the unsightly cargo port and grain terminal built in the 50s was tabled again to free a considerable area of the Volga territory with the development of Sviyazhsk Multimodal Logistic Centre. The urban authorities think that owners will still have the land title but can build something that will fit in the concept of Kazan’s Volga facade.
However, it isn’t clear yet if the final decision on the relocation of the Kazan port terminal has been made. Nowadays the elevator keeps providing a big number of Kazan bread factories with flour to bake bread. Its capacity is 50,000 tonnes. The reception of Tatarstan Grain Technologies JSC (Editor’s Note: it is a part of Krasny Vostok GC managing the port elevator) didn’t manage to say anything about the future of the complex citing that the management was on holiday.
Meanwhile, market players have expressed concern about the possible change in logistics. “Kazan annually consumes 350-360 tonnes of bread. It wasn’t probably invented accidentally so that the city’s needs would be met by two elevators: one is on land and the other is on water. Meanwhile, the Tatarstan Ministry of Agriculture and Food hasn’t yet answered Realnoe Vremya’s question.
7 billion in grain bins
Avgust-Agro PLC is a group of companies that covers almost all sectors of agriculture: horticulture, poultry farming, pig farming, fodder production and meat processing. Production of fodder, pre-mixed forage and fodder concentrates is the key business of the company. 2020-2021 will become decisive to settle in Tatarstan.
According to Director general of Avgust-Agro MC PLC Aydar Galyautdinov, in the future, the company intends to invest almost 7bn rubles in Tatarstan projects. Apart from the two elevators, the company hopes to build another five grain dryers in the districts it has a business (first of all, it is Musyumovo and Menzelinsk Districts). The interlocutor of the newspaper says that Avgust-Agro’s enterprises’ revenue in Tatarstan totalled 2,28bn rubles in horticulture and 286m rubles in livestock breeding.
So in 2020, Avgust-Agro has purchased new businesses in Leninogorsk, Aznakayevo, Tyulyachi, Kamskoye Ustye and Verkhny Uslon Districts. The area of our lands in Tatarstan by the end of the year has amounted to 148,000 ha, including 130,000 hectares of arable land.
“Buying the businesses, we invested a lot of money in production infrastructure, in providing them with transport and agricultural machinery. We have built two grain dryers with a capacity of 50,000 tonnes an hour each in a year: in Karkali village in Leninogorsk District and Starye Karamaly in Muslyumovo District,” he said.
More fresh milk by Avgust
On the other hand, Avgust-Agro actively develops milk production. Nowadays the company is building high-tech robotised milk complexes for 2,400 heads each in Muslyumovo and Menzelinsk Districts. The first phase of the complex for 1,200 heads in Urazmetyevo (Muslyumovo District) is over. The construction of the first phase in Menzelinsk District was launched in October.
Moreover, there is a number of small farms purchased by the agricultural investor. They are reconstructed and re-equipped because the technical state of cowsheds didn’t meet requirements, as a rule. This year, the company has begun purchasing pedigree animals for the farms it bought. The total amount of the cattle has been 15,584 heads by the end of the year. These heads are kept for meat and milk.
“We don’t see prerequisites for closing the current programmes”
Like all agricultural producers, Avgust-Agro uses state support programmes that are in force at federal and republican level. It is subsidies for technical and technological modernisation of the agricultural farm (the programme is 60 to 40), purchase of mineral fertilisers, lime treatment of acid soils, subsidies to buy elite seeds, stimulate the development of grains and pulse crops, cultivation of oil-bearing plants.
“I think many will agree with me that the implementation of sectoral projects in Tatarstan would be simply impossible for agro-firms and entrepreneurs without the management of the republic and the Tatarstan Ministry of Agriculture and Food,” Aydar Galyautdinov stressed. He hoped that the support measures for agriculture would stay next year despite the pandemic. “We don’t see prerequisites for closing the current programmes,” he said.
Member of the Tatarstan State Council’s Committee for Environment, Use of Natural Resources, Agro-Industrial and Food Policy Takhir Khadeyev thinks that investments in the infrastructure designed to store the grain gives agriculturists a chance of selling the grain for a price that’s favourable in the economic situation, not “selling fast” and losing 3-5,000 rubles per tonne. However, he thinks that it is effective to build elevators at a distance of 30-50 km far from the arable land, while rural residents should unite to create cooperative elevators. According to his data, now the republic has over 40 elevators with a capacity of above 2 million tonnes of grain.