UPDATE: Ministry: Food factor of Russian inflation falls to 31% in Jun

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MOSCOW, Aug 2 (PRIME) -- Ñontribution of the food price growth to Russia’s inflation decreased to 31% in June from earlier peaks of 52% in February 2015, an official for the Economic Development Ministry told PRIME on Tuesday.

The food import embargo introduced by the government as retaliation against Western sanctions was a significant factor of inflation acceleration in late 2014 and early 2015 because food prices soared on undersupply and the lack of competition, he said. Food price growth exceeded inflation by 20% in 2014–2015 and contributed 46% to inflation in general.

“The food market has managed to adapt to the new conditions: the refocusing of importers on new suppliers took place in the first half of the year (2015) already, purchases started to be made at lower prices. The process of import substitution replacement with cheaper local goods was also active,” the spokesman said.

He said that annual inflation in June was 6.2% against 18.8% in June 2015.

The official said separately that the combined loss of the E.U., Canada, Norway and Australia from the Russian food embargo stands at U.S. $8.6 billion annually.

In 2015, the imports of food from these countries fell 96.5% to $312.3 million. In real terms, food imports from these countries decreased 98.9% to 46,500 tonnes.

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