Russia Business Directory
Within the limits of the project, agricultural enterprises should have been given favourable loan conditions. However, in 2006, only 2% of the farmers and 0,3% of private plot owners were able to get bank loans. The reason is simple: most of applicants were just not able to provide sufficient proofs for their solvency.
Growing meat import both makes meat production in Russia unprofitable and drags the prices down. In 2006 around 50% of meat products sold in the Russian market were imported. High costs of transport, caused by underdeveloped infrastructure as well as constantly increasing transport tariffs, and the monopoly power of the processing industry prevent Russian rural sector from beating foreign competitors.
Salaries in the agricultural sector are the lowest in the country, twice as low as an average Russian salary. In 2006, monthly salary in the agriculture was around 4500 roubles (a little bit over NOK1000). In contrast, Russian oilworkers representing the other top of the scale with Russia's almost highest salaries (after financial mediators) earned about 27000 roubles a month (approx. NOK 6500). Even knowing that official statistics do not take into account various by-incomes not reported to the authorities, the figures are still stunning.
Every ninth Russian living in the country-side, is jobless, and this percentage is even higher among young people. Poverty, alcoholism, labour outflow, disintegration of infrastructure are hitting the agricultural sector more then others. Since 2000, about 1 million people left Russian villages and moved to the urban areas.
However, the situation in the agriculture sector is slowly improving through the impact of the market forces. The new market conditions have also shown that investment in agriculture may be rather profitable, at least in so-called "Black-earth" regions (Tchernozemie). Most of the regions are however still suffering from an economic recession. The critical situation in the agricultural sector has forced an association of the agricultural enterprises and farms to send a letter to President Putin in August 2006 urging the authorities to take drastic measures.
The preliminary results of All-Russia Agricultural Census carried out in 2006 showed that the real state of affairs differs from the official statistics; in certain indicators, the deviation reaches 30 %, reports Commersant Daily. The cattle population, for instance, proved 3.4 % above the current statistics, while pig population exceeded today’s data by 12 % and there are 7 % more sheep and goats than expected. It should also be mentioned that it was really high time for such a census as the previous one was carried out in ... 1920.
Structure
There are several categories of market players in the Russian agriculture, so that this sector is not necessarily being dominated by famous kolkhozes and sovkhozes. The first big group is various agricultural enterprises (this definion is also used for statistical purposes) ranging from productive cooperatives, joint stock companies - former kolkhozes and sovkhozes, state enterprises, subsidiary farms of industrial, transport and other enterprises and organizations, scientific-research and other institutions.
Private farms are as a rule composed as an union of citizens, having property in common ownership and performing jointly production or other business activity (production, processing, storage, transportation and sale of agricultural produce) on the basis of their personal participation. They are also called "peasant farms".
The last but not the least is household farms and plots relating to personal subsidiary plots, land of citizens for collective and individual farming, gardening and cattle breeding.
Presently, most of arable land belongs to large and medium-sized agricultural enterprises – about 233,3 of the total 330m hectares. Farmers own about 25 million hectares, while private plots 8,5 m hectares. An average farm size is about 100 hectares, a private plot size - about 52 ares.
Information sources: State Statistics Bureau, All-Russian Agricultural Census, Commersant Daily, Agrarian Party of Russia, NRCC Newsletters.
Did you know… 84% of Russians would prefer Russian food products to imported, if given a choice, shows a poll carried out by WTsiOM. The most common arguments are “they are better and with a higher quality”, “more natural, without any poison”, “they come from our own land” and “they are to trust”. |
General information
Ministry of Agriculture of Russian Federation - official site: structure, news, analysis, tendencies, forecast, international cooperation, federal programs. Links to Russian veterinary service and Agency of Fisheries are also on this page. Unfortunately only in Russian (rus)
About Ministry of Agriculture - summary in English about the leaders of the ministry, functions, subdivisions (eng)
AgriMarket.Info – a rather comprehensive and up-to-date website offering agricultural information on Ukraine, Russia & CIS, including latest news; grain, oilseed, sugar market reports, outlooks and studies, crop and weather news, price information, offers & bids directly from companies, press-releases and other companies' information (eng/rus)
Agrarian Party of Russia - official website of the named political party with a short summary in English. Russian version of the website contains updated statistics, analysis and news (eng/rus)
Russian Agriculture - summary from the website RussiaProfile.org (eng)
U.S. Department of Agriculture's Foreign Agricultural Service – collection of reports about Russian agriculture for US exporters. (eng)
The All-Russia Agricultural Census 2006 – official site of the Census, news, press releases, questions and answers, information materials, normative legal certificates, foreign experience (rus). This website provides an English summary.
Statistics on crops production in Russia 1995-1999 – short reference by Business and Marketing Analytic Centre (eng)
Crops production in Russia - distribution of various types of crops per 2006 (eng)
Cattle breeding in Russia - structure of production by the type of enterprises (eng)
NRCC Member Companies
Kverneland Group - producer of agricultural machinery with a wide selection of high quality cultivation equipment concentrated around conventional and reversible ploughs, soil packers, disc and power harrows, rotary tillers, cultivators, choppers and all purpose forks (eng)
Kverneland Equipment in Russia - website of Russian company DokaGene, official distributor of agricultural machinery from Kverneland (eng)
Russian Baltic Pork Invest - Norwegian company with a pig-breeding project in Kaliningrad (nor)