Thanks to good weather and a slight increase in fertilizer use, this year’s grain harvest in Russia is expected to reach 82-83 million tons, compared to 69 million tons last year. (Reuter, September 29) These figures still compare unfavorably with the peak harvest of 128 million tons recorded in 1978. However, structural reform of the farm sector has been agonizingly slow, with no substantial changes since 1991. This was frankly admitted by Deputy Prime Minister and Agriculture Minister Viktor Khlystun in a recent interview. (Komsomolskaya pravda, September 30)
Khlystun noted that the number private farms reached about 280,000 in 1993, after which they stopped increasing and account now for only about 8 percent of food production. (To this can be added the small private plots run by individual peasants and city dwellers, which still raise at least 30 percent of Russia’s food.) Khlystun blames the farmers’ woes on price gouging by the wholesalers and retailers, and to competition from imports, which account for 35 percent of Russia’s food consumption. One positive sign is that some meat and dairy processors have learned to be competitive, with dairies turning out over 50 types of dairy products, instead of half a dozen as in the past. Khlystun is in favor of privatizing land in order to enable farmers to use land title as mortgage for bank credits, but is against free sale of land in order to prevent it from ceasing to be used for agricultural production.
In recent years the government’s policies have done little to improve the food distribution system. The notorious Federal Food Corporation was formed in 1994 to coordinate food purchases for large cities. It was allotted 1.3 trillion rubles ($250 million) by the Finance Ministry — most of which is now thought to have been stolen. Several dozen regional managers of the state corporation have been arrested, and recently the first sentence was handed down. The former head of the Perm branch was sent to jail for 18 months for embezzling 3.5 billion rubles ($650,000). It was a modest sentence by Russian standards. (Kommersant-daily, October 2)
Russians Flex Their Nuclear Muscles.