"SOFT GOLD OF RUSSIA"



Video conference on development of caged-animal farming

Video conference on development of caged-animal farming

Fur week Soft Gold of Russia, the largest international platform for business communication between fur industry representatives, in accordance with tradition, is annually held in April. However, in 2020, due to the coronavirus COVID-19 spread, we were forced to postpone it to August.

Nowadays animal husbandry is also in a difficult situation. Like never before, now it is obvious how we all depend on each other as important links in fur market structure. Today we have to support each other’s business in order to survive a difficult time and overcome the crisis.

The video conference chaired by the First Deputy Minister of Agriculture of the Russian Federation Dzhambulat Khatuov, which took place on June 8, was dedicated to this industry branch problems. Aron Mardakhayev, a Chairman of the Board of Directors of Soft Gold Company, and Valery Dokuz, a President of the Soft Gold Fur and Leather Association, have taken part in it. The federal Ministry invited to the dialogue some animal farms heads who shared their problems and difficulties, and representatives of Russian constituent entities being in charge of the enterprises. Such unique enterprise operates in our Stavropol Territory.

Since 2014 a crisis has been observed in the Industry, so furs prices have decreased significantly. As a result there is massive bankruptcy and closure of animal farms observed around the world. This has led to reduction in the number of fur animals by 2.5-3 times. In Russia, a law is in force according to which fur farms have become VAT payers. In 2019, such enterprises received less than about 50% of revenue. In case of a VAT reduction the high-quality furs prices will become lower. And this will affect the final product prices. A consumer will be able to get a quality domestic fur coat at an affordable price.

Speakers agreed that fur farming suffers significant damage from the COVID-19 coronavirus. It is necessary to apply for its inclusion in the list of affected industries. 
Today, fur farms are facing the problem of selling raw materials. The Soft Gold of Russia fur week is a perfect platform where you can sell your products directly to factories, so far only Russian ones, but even this is a nice chance in today's conditions. It is an opportunity to exchange experience, find business partners, bring your production to a new quality level.

In 2020 the Industry faced pandemic-related activity restrictions, which definitely affected production. It is necessary to apply for inclusion of fur farming in the list of the sectors most suffered from the pandemic.

Jambulat Khatuov noted that for such inclusion a clearly stated reasoning is needed.
Another proposal received from the heads of animal farms was a return to a single agricultural tax: abolition of VAT and transition to the Unified Agricultural Taxes will allow us to see a positive perspective for the Industry development. Deputy Minister Elena Fastova said that back in April the Ministry had already applied to the Russian Government with a proposal to include fur farming in the list of sectors suffered from coronavirus spread. Following the meeting, the Ministry will send to the Government another letter with a petition on inclusion of fur farming in the list.

Summing up the meeting, Dzhambulat Khatuov noted that all the proposals received should be summarized and a report should be presented within a week, which would set out all the necessary measures: inclusion of fur farming in the list of the most affected industry sectors, vaccination prices revision, additional federal subsidies, VAT related issues and credit policy.

Fur farms are usually important participants in the Soft Gold of Russia Fur Week. For the domestic market of Russia, whose share on the international market is about 70%, it is impossible to obtain a high-quality fur product without high-quality affordable raw materials.