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How does the order process work in Russian Coriander Industry?
As it’s a seasonal product, after it is harvested it is stored in warehouses and sold from stocks. End of August – November but the time may differ based on when the snow will stop.
Big producers export themselves but only around 20% of middle-sized and small ones export themselves. It’s more common to sell raw material to a trader who accumulates bigger volume, looks for an end buyer, and solves all export connected issues.
There are some state measures to help farmers in common, including special conditions for credits, but it’s not oriented for coriander farmers and the measures don’t have a big supportive base.
If the supplier has a good and profitable contract with an end buyer, the supplier may find the additional amount from other farmers.
Each supplier is independent, but when it comes to price formation they do orient to the market and price range of competitors.
What can I know about the supply chain?
Farmers sell the products by themselves for domestic sales, and 20% of the farmers do the export themselves because the process is quite difficult and only 40% of Russians speak English.
There are farmers or traders or big companies who accumulate the product and form a bigger volume for export.
Most of the farmers are small and medium-sized. Normally a farmer has more than 5 crops and coriander is just one of them.
Domestic Market : Farmers => domestic sales channel => processors/ retailers
Global Market: Farmers => export sales channel => End buyers/ Traders
Farmers prefer to work with a trader who can pay straight away and take all risks with an end buyer.
How is the Russian coriander supply chain formed?
-Coop
Most big farmers are members of the Russian Grain Union. This union does not just focus on corianders. This union raises concerns over prices but does not directly affect their prices.
-Oligopoly
There is no oligopoly. The market is competitive. Normally, farmers decide which crops to grow for the next year by analyzing the market demand in order to maximize the profit.
Which countries are rising markets for Russian Coriander?
-Due to the fact that coriander is grown more in the European part of Russia, it is more effective to develop export destination to Europe (like Germany, Poland, UK, Netherlands) or Arabic countries such as UAE
-Egypt has shown a notable high demand recently.
Which countries compete with Russia in the coriander market?
The main producer of corianders is India but because of better weather conditions in Russia (less sun), the Russian corianders have better quality.
-Russian corianders have more oil content that could be more fit in producing coriander oil. Quality differs mainly on the purity and moisture, and 88%-99% of purity is sold. The moisture level is quite similar for all producers.
Which countries are top producers of coriander?
The top producing countries of coriander are India (1.45M MT, 73.8%), Mexico (100.56K MT, 5.1%), Syria (82.69K MT, 4.2%), Iran (67.80K MT, 3.5%), and China (59.41K MT, 3%).
What are the regulations for exporting?
Phytosanitary control issued by Federal Service for Veterinarian and Vegetation Sanitary Supervision (Rosselkhoznadzor)
Prove of payment of customs duties
Documents to confirm currency control (trade contract passport, certificate of currency transactions from the bank)
Documents to confirm the cost of export product and how the cost is determined
Documents on the basis of which the classification code of the goods was declared for the Commodity Nomenclature for Foreign Economic Activities
Certificate of Origin ("ST1" form - for CIS countries, form "ST2 form" - for Serbia, "A" form - for EU and North America countries)
Declaration of conformity in accordance with Technical Regulation of Customs Union - TR TS 015/2011
What are the certifications for exporting Russian Coriander?
Export customs declaration A signed a foreign trade contract with additional agreements
Commercial invoice and translation
Payment documents confirming payment for goods
Commercial invoice and translation
Documents, describing technical goods' characteristic
Documents for transportation: CMR for road, Air waybill for air, Railway invoice for rail
Packing List
Cargo insurance
Agreement with the carrier and confirmation of payment
How is the quality assessment process in Russia done?
After the harvest is done, farmers make quality tests (moisture, purity).
When a farmer has a buyer, the farmer may send a sample to the buyer for quality check, or what is more widespread may make laboratory test in an independent organization.
3rd party inspection service commonly used for export sales (the expenses will be paid by buyer).
When farmers harvest, they bring the product to the organization and do the quality test. For international buyers, farmers go to a third-party inspector/laboratory to prove the quality. If the farmers pay it, then they include it in the payment to be paid by the buyer.
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