* Import bans cause spikes in some food prices
* Some well-connected food firms benefit from new market gap
* Share prices spike for some fish and meat firms
* "I don't see any negatives," says Russian senator
By Maria Kiselyova and Olga Sichkar
MOSCOW, Aug 22 In the escalating dispute between
Russia and the West over Ukraine, a group of businessmen with
Kremlin connections are emerging as likely beneficiaries of the
Earlier this month, Russia banned all U.S. and EU meat,
fish, dairy, fruit and vegetables in retaliation for Western
sanctions imposed on Moscow after it annexed Ukraine's Crimea
region and backed separatist rebels fighting Ukrainian
That has sent some local food prices soaring in Russia and
opened a gap in many markets.
A fish company co-owned by the son-in-law of a friend of
President Vladimir Putin, a meat company with a well-connected
founder, and another private meat producer enjoying state
support are all seeing a spike in demand for their produce.
Reuters has found no evidence to suggest that the bans were
imposed with the aim of helping any particular producers, or
that any producers lobbied the government for the restrictions,
but the food tycoons look set for a windfall.
"Wholesale prices have already risen; they are already
earning," Sergei Lisovsky, once himself a food magnate and now a
Russian senator, told Reuters this month.
Russian officials warned food producers against price rises,
but days after the bans were imposed salmon was up 60 percent at
over $22 per kilo in some shops.
According to distributors, beef and cheese prices will also
rise by at least 30 percent as imports had been meeting 30-50
percent of local consumption.
Shares in fish firm Russkoe More jumped 70 percent
in the days after the ban.
Oil-to-banking tycoon Gennady Timchenko, a friend of
President Vladimir Putin, bought a 30 percent stake in the firm
in 2011, betting on rising demand for salmon.
The firm says it was the leading chilled red fish importer
last year, with a 26 percent market share, with the fish coming
from 18 countries including Norway. Norwegian fish imports have
been included in the Russian ban.
After Washington first imposed sanctions in March, Timchenko
sold his stake to son-in-law Gleb Frank.
"Timchenko has no influence over the firm any more. We have
totally distanced ourselves from that business," a spokesman for
Meat firm Ros Agro also saw steep stock price
Its CEO Maksim Basov said the company would benefit from the
"Prices will at least not fall. We will have opportunities
to increase production. Competition will fade, we will develop.
We expect phenomenal results in all business segments," he said.
Ros Agro was founded by businessman Vadim Moshkovich, who
transferred company ownership to his family after becoming a
senator in 2006 as a member of the ruling United Russia party,
which is chaired by Prime Minister Dmitry Medvedev.
When Ros Agro went public in 2011, it said in its prospectus
that its business could suffer if Moshkovich, estimated to be
worth $1.3 billion by Forbes Magazine, ceased to be its
controlling shareholder or senator.
"Because Mr. Moshkovich has intimate knowledge of the
workings of the local government, the Group is better able to
reap the benefits of the government interest subsidies and other
support programs offered," it said.
When asked by Reuters whether it would like the government
to provide more support to the industry to help make up for the
banned imports, Ros Agro said, citing its CEO, that the import
substitution would ultimately happen anyway, although such
support would speed it up.
Privately held Miratorg, Russia's biggest pork producer,
with annual sales of over $1.5 billion, has - unusually for an
agricultural business - received big state loans.
Medvedev personally inspected one of its landmark projects,
when it brought tens of thousands of Aberdeen Angus cows to the
Bryansk region from the U.S. and Australia.
Miratorg is owned by businessmen Viktor and Alexander
Linnik, who are worth $360 million, according to Russian
They stand to gain from import shortfalls caused by the
"The situation (with sanctions) has once again demonstrated
the need to develop our own production to guarantee reasonable
prices for Russian consumers and food sovereignty from our
partners in the World Trade Organisation," the company said.
Senator Lisovsky, a TV advertising tycoon in the 1990s who
helped President Boris Yeltsin win the elections, says bans will
do Russia only good.
"Will Russia lose anything? I don't see any negatives," said
Lisovsky, wearing a Tajik robe and offering reporters fruit and
vegetables he said came from neighbouring Tajikistan, Iran,
Turkey and Uzbekistan.
Lisovsky knows a thing or two about the opportunities
arising from sanctions. When, a decade ago, Russia banned U.S.
poultry imports to retaliate against U.S. sanctions on Russian
steel, he was fortunate to have invested heavily in chicken
farms not long before.
Though Lisovsky has since sold that business, Russia, which
previously relied heavily on U.S. poultry, became almost
(Reporting by Maria Kiselyova and Olga Sichkar; Editing by
Dmitry Zhdannikov and Will Waterman)