Publication: Monitor Volume: 6 Issue: 192

The Belarusan grain harvest is nearly complete, with crops totaling just over 5 million tons (Belarusan Radio First, September 19). Crop output in 2000 is expected to show improvement over the disastrous harvest of 1999, but agricultural output overall is still on an overall downward trend and is hampered by a lack of market reforms.

This year’s harvest is expected to reach 5.5 million tons, an increase of 45 percent over the 1999 harvest of 3.8 million tons. Grain yields on average are also up, by more than 26 percent over the same period the year before. These figures are still inadequate to cover Belarus’ total needs, however, as deputy Agriculture Minister Anatoly Rubanik notes that Belarus will have to import 1.5 to 2 million tons of grain to meet its domestic demand of approximately 7 million tons (Reuters, August 9). Moreover, total agricultural output as of September 1 had contracted 1.5 percent as of the same period in 1999, according to the Ministry of Statistics and Analysis. The improvement in crop production has been offset by continued declines in such animal products as milk, eggs and live cattle.

Agricultural output has declined steadily since 1990, and the sector remains in need of restructuring. Collective and state farms cultivate 83 percent of arable land in Belarus, yet their productivity is only one-third that of private farms, according to Belarusan National Academy of Sciences member Ivan Nikitchanka. In April, Nikitchanka had predicted that Belarusan agriculture “will not survive this year.” While little agricultural land has been privatized–and most of this is devoted to subsistence activities–private farm output accounts for 90 percent of the potato crop, 84 percent of vegetables, nearly half of egg, milk and meat production, and fully 100 percent of fruit and berry output. Heavy-handed government regulation of the agricultural sector–including price controls and mandatory procurement quotas–combine with payment delays to weaken commercial incentives in the farm sector. Soft credits have been used to prop up state farms, which in turn boosts Belarusan inflation. To finance this year’s production, the Council of Ministers has encouraged banks to offer numerous loans, such as a US$20 million and 5 billion ruble package approved in August. This mechanism however encourages dependence on such loans, and inhibits farms’ ability to respond to price changes.