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Review of the Russian Market for Non-Cultivated Crop Processing Equipment

Research by the Company “Eventus Consulting”
Russia has huge potential in processing and sales of wild, non-cultivated crops such as mushrooms, berries, nuts, and herbs. The country’s territory has a large number of wild mushrooms and berries subject to industrial collection and processing – these include varieties such as boletus mushrooms, chanterelles, honey fungi, lingonberries, bilberries, blueberries, cranberries, black and red currants, and bird cherries. Pine nuts are one of the unique raw resources with great economic value due to the high content of essential fatty acids, proteins, digestible sugars, fiber, B, PP and E vitamins, as well as minerals. Nuts are rich in potassium, iron, phosphorus, zinc, and magnesium.
At the moment, there is a clear trend involving consumption priorities shifting towards organic, natural goods, which explains increased demand for frozen and dried mushrooms, berries and nuts.
It should be noted that the waste formed through pine nut processing is a valuable technical raw material itself. Cores and scales left after cone peeling are used as raw materials for production of resin, furfural, tannins, and colorants. Pine nut shells contain large amounts of tannins and can be used to produce durable brown paint for the leather industry. Dry distillation of pine nut shells yields methanol, acetic acid, and carbon with high adsorption capacity. Upon degreasing, the skins remaining after pine nut kernels are peeled are suitable for stuffing mattresses and furniture production. Pine nut shell-infused spirits are used in traditional medicine.
Collection, storage and processing of berries and mushrooms make up a complex, labor-intensive progress requiring constant product quality control at every stage.
Non-cultivated crop processors can be divided into 2 main categories:
* small companies, and companies only active in collection and primary processing. According to the local Union of Wild Growing Products Processors, the number of such companies in the country is approximately 800. Some of them only open up for a single season. This group is, for the most part, made up from sole traders;
* large and medium-sized crop processors carrying out both primary and deeper stages of processing. According to the Union of Wild Growing Products Processors, the number of such companies is around 40–50. Among them, several large enterprises occupy a significant share of the market, and the rest are numerous medium-sized companies.
The Russian market for non-cultivated crop processing equipment is, in essence, in its infancy and has not fully formed yet. It can be divided into 2 large segments:
* specialized processing equipment (e.g. cone crushers, peeling machines and other equipment for nut processing);
* universal food processing equipment, suitable for non-cultivated crops as well (equipment for shock freezing, drying or packing; canning lines; and other types of machines).
Self-made equipment is popular with numerous processors, especially small companies.
Only a few domestic producers specializing in equipment for non-cultivated crops can be identified in the market at the moment – moreover, typically they only offer machines designed for small processing volumes. Among them, the following Tomsk companies should be highlighted: Proizvodstvennoe Obyedinenie (Production Association) “MTK”, IP (Individual Entrepreneur) Laktionova Elena Vladimirovna, and “Dikorosy (Wild Plants)” Group.
Regarding large and medium-sized processing companies, they primarily use imported specialized equipment. For instance, “Yagody Karelii (Karelia’s Berries)” (Petrozavodsk), one of the leading non-cultivated crop processors, is among the major operators in both the Russian and European markets for freshly frozen berries and derived goods. The company occupies more than 50% of the Russian market in sales of frozen non-cultivated berries in industrial storage containers. Recently, the company has launched a new product line, which includes freshly squeezed juice-based nectars, mors, jams and syrups.
“Yagody Karelii” uses modern optical sorting equipment in production. Quality cleaning of frozen berries is ensured through the new production line supplied by “Cabinplant” (Denmark) with the performance of up to 5 tonnes per hour. Digital control is performed in the sorting unit composed of machines by “Sortex” (England) and “Best” (Belgium) with the use of optical, laser and infrared cameras. Moving berries are sorted by color, size and shape by an optical sorter with CCD cameras and laser detectors. Cleaned frozen berries are defrosted, blanched, mashed and crushed before pressing, are fermented, and go into a multipress by “Bucher” (Austria) with the production capacity of 10 tonnes per hour. A bottling line with the performance of 6 thousand bottles per hour pours hot juices and other drinks into glass bottles and tightly seals them.
Another example is “Rusberry Line” LLC (Vologda region), a company that has been operating in the market for more than 6 years. Processing approximately 4 thousand tonnes of berries per season, the company is only active in cleaning and supplying frozen packaged goods to the retail sector. The company collects berries and mushrooms in 5 Russian regions, has extensive production capacity, and is capable of packing and storing products in various ways.
Processing of wild berries is performed with the use of the latest equipment and involves the following stages:
* shock freezing in a tunnel by “Frigoscandia” (-35–40°С) (Sweden);
* cleaning berries from forest debris, berry size calibration, separation of pedicels and perianths on modern equipment supplied by “Mega” (Poland);
* digital sorting with the use of equipment by “Sortex Buhler” (England);
* packaging into shipping containers – 3-layer kraft bags with of 25 kilogram net weight an inner laminated layer; 10 kilogram net weight corrugated boxes (HoReCa format); and ‘retail’ packages with product weight varying from 250 grams to 5 kilograms.
According to the Union of Wild Growing Products Processors, the largest foreign manufacturer of non-cultivated crop processing equipment is the German company “Buhler AG” (“Buhler Group”). Among Russian producers, the Union highlights PO (Production Association) “Agromash” (Moscow), “Noriya-Tsentr” LLC (Abakan), IP Laktionova Elena Vladimirovna (Tomsk), “SiSort” LLC (Barnaul), and others.
Equipment by Chinese, Russian and European manufacturers occupy the largest share in the Russian market. The lowest costs are observed in Chinese equipment.
Annually, the Russian Federation imports various equipment valued at hundreds of thousands of dollars. In 2017, 153 units of imported equipment for pine nut processing manufactured in China valued at $ 192 thousand were supplied to the Russian market: 70 nut cleaners, 50 skin removers, 30 machines for peeling pine nuts from their shells, 1 fractionator, 1 drying machine, and 1 technological line.
The approximate average cost of imported equipment is as follows: skin remover – $ 1,100; shell remover – $ 1,400; fractionator – $ 2,600; dryer – $ 7,400; technological line – $ 8,800.
Lately, Russian manufacturers of finished food processing lines, some of which are designed for non-cultivated mushrooms and berries, have been giving preference to domestic equipment and components in their selection. There is a trend towards an increase in the share of Russian equipment – according to Roman Mogilevtsev, project manager at “Technopool-R” LLC, at the moment the share of domestic equipment and components amounts to about 80%. This has to do with the fact that at this point, a number of Russian alternatives are comparable to imported equipment in terms of quality, whereas maintenance of the former is quicker and overall more convenient. At the same time, “Technopool-R” reports that it is advised to choose imported equipment when it comes to mushroom cutting – preferably machines by “Kronen” (Germany). Domestic equipment designed for the purpose is highly undurable and ‘capricious’ in use. In other units, including sorting machines, it is recommended to install Russian equipment, as the terms, materials, maintenance and final cost of operation are highly advantageous in comparison to imported solutions.
According to experts, in the medium and long term, further growth in the share of domestic equipment for non-cultivated crop processing is awaiting the Russian market. 
In the past 2 years, a considerable increase in demand for freezing equipment has been observed. According to “Technopool-R”, this is due to state subsidies as well as new processing companies having entered the market. While drying equipment is most demanded in southern regions of the Russian Federation, Russian processors in the central part of the country and in regions up north have been demonstrating increased demand for shock freezing equipment for mushrooms and berries. 
Development of the market for non-cultivated crop processing equipment will be directly affected by development of the industry of collection and processing of non-cultivated crops.
By January 1, 2016, 342 forest sites with the total area of 2 million hectares had been rented for the purpose of processing edible forest resources and collecting medicinal herbs. Most of these lands are located in the Far East and in Siberia: Primorsky Krai – 697 thousand hectares; Khabarovsk Krai – 312 thousand hectares; Tomsk region – 444 thousand hectares; Buryatia – 123 thousand hectares; Irkutsk region – 112 thousand hectares.
The main estimated volume of edible forest resource production on rented forest areas falls on nuts (7,200 tonnes) and berries (1,400 tonnes); large volumes also fall on medicinal herbs – 700 tonnes, mushrooms – 500 tonnes, and birch sap – 400 tonnes. 
It should be noted that the European part of Russia mainly processes mushrooms, berries and birch sap, whereas the Asian part processes nuts. 
The sphere of edible forest resource processing is a promising industry with potential for economic growth due to the mass of unused reserves of renewable biological supplies. Its development is capable of sparking a multiplicative effect and stimulating output growth in related industries, such as the food and drink, food processing, and pharmaceutical industries, as well as agroindustry. The branch may also play an important role in solving social issues by providing opportunities for self-employment to citizens and creating additional jobs and thus incomes, which is particularly relevant in depressed and remote areas of the country.
In certain regions such as Russia's Far East, food processing may be the preferred development model for forest use in a number of forest areas. In the long term, the use of forests’ non-wood and food resources may turn out to be more profitable than timber harvesting, and has a number of other advantages in addition to economic benefits. According to experts, any timber having grown during the abundant fruiting period of a single cedar tree (200 years) yields 8 times less incomes to budgets, more than 700 times less incomes to households, and 20 times less incomes to the tenant than those generated by nuts processed throughout said time period.
The Union of Wild Growing Products Processors states that the main problem of all processors in the industry is ensuring stable and full load of production lines, which is challenging due to irregular harvests of various wild plant varieties and legal raw material supplies. The difficulty of choosing equipment (the questions of the HACCP principles, payback etc.) plays a role in this as well, and so does the attraction of financial resources required for the purchase.

Experts at “Eventus Consulting”