Country Focus: Russia

by Mindy Dake
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Official name: the Russian Federation.
Capital: Moscow.
Population: 148.9 million (1992), 74% of which is urban. About 13% of the labor force works in agriculture.
Language: Russian.
Religion: Russian Orthodox.
Government: Federation. Chief of state and head of government is President Boris Yeltsin.
Official agricultural agencies: Ministry of Agriculture.
Land and climate: Area is 17.1 million square km. Terrain includes broad plains, steppes, uplands, mountains and tundra. Climate varies from humid continental, arid, subarctic to polar conditions.
Russia is bordered by North Korea and China to the southeast; Mongolia and Kazakhstan to the south; Iran, Turkey and Ukraine to the southwest; Belarus, Latvia and Estonia to the west; and Finland to the northwest.
Russia has 37,653 km of coastline, with the Bering Sea, the Sea of Okhotsk and the Sea of Japan on the east; the Barents, Kara, Laptev and East Siberian seas on the north; the Baltic Sea on the west; and the Black and Caspian seas on the southwest.
Economy: in transition. After the collapse of the former Soviet Union in 1991, Russia embarked on a program of ambitious economic reforms aimed at moving toward a market orientation from central planning. Reforms to date include some degree of price liberalization, privatization and decentralization.
The reforms have proceeded without the financial and legal institutional framework necessary to manage a market economy, and Russia has been besieged with economic and financial instability. Problems include extremely high inflation; an ineffective banking system and interest rates in excess of 200%; productivity declines; shortages of equipment, materials and consumer goods; currency depreciation; declining foreign trade; and contraction in gross domestic product.
Nonetheless, economic change in the past three years has been stunning, and the reform effort continues. Privatization is moving ahead, albeit slowly; the World Bank estimated in 1993 that some 13% of Russia's G.D.P. was generated by the private sector, and the percentage has grown in 1994. Interest and inflation rates are declining, and the government has announced plans to strengthen and stabilize the banking system and to encourage greater foreign investment.
G.D.P. per capita: U.S.$2,680 (1992). Agriculture accounts for about 12% of total G.D.P.
Currency: the ruble. The ruble is non-convertible, which means it cannot be exchanged freely into other currencies. July 7, 1994 exchange rate: 2,011 rubles per U.S. dollar, as quoted by the Moscow Interbank Currency Exchange.
Major crops: Small grains, primarily wheat, barley, rye and oats. Russia also produces potatoes, sugar beets and vegetables.
Wheat: Russia's most important crop, generally accounting for 40% to 45% of Russia's total grain harvest. Annual production from 1990-91 through 1993-94 averaged 44 million tonnes. Winter wheat makes up slightly more than 50% of the wheat total.
Annual wheat consumption in the same period averaged about 54 million tonnes, with some 55% of the total used for feed. Imports averaging about 10 million tonnes a year filled the gap between production and consumption.
Russia's 1994-95 wheat harvest is expected to be substantially lower than average, with mid-summer projections at about 38.5 million tonnes, based on winterkill and shortages of seed, inputs, cash and credits.
Consumption in 1994-95 also is expected to fall below average, with initial projections at fewer than 48 million tonnes.
Other grains: Russia's annual barley harvest averages around 23 million to 25 million tonnes. Oats and rye production typically reaches between 10 million and 13 million tonnes a year for each grain. About 70% of total barley, oats and rye use is for feed.
Livestock: Russia's livestock industry has been hard-hit by many of the same problems affecting crop producers; furthermore, reduced consumer buying power has slashed demand for high-priced meat.
Feed shortages, price liberalization and lower subsidies have sparked sharply higher feed and input costs and slashed profitability. Although meat procurement prices increased by six to nine times from 1990 to 1992, feed prices increased 16-fold.
Meanwhile, demand slumped when retail meat prices increased. From 1990 through 1992, annual per capita meat consumption dropped by 22%, to 52 kg from 67 kg.
Although the Russian government reintroduced some subsidies, the industry's overall profitability has not yet improved. Total animal numbers declined 25% to 35% from 1990 through 1993, and indications are the numbers may have dropped an additional 10% to 15% in the first half of 1994.
Flour milling: Russia's commercial flour milling industry consists of 355 large plants with a total annual capacity of about 20 million tonnes in terms of flour. Some 63% of these mills have a daily capacity of more than 150 tonnes, and 24% have a daily capacity in excess of 250 tonnes. About 30% of the mills have been modernized in the past five to six years.
Most of the commercial mills are in some stage of privatization. In addition, flour mills now may buy and sell wheat and flour on the free market, although price controls on bread create some constraints.
Feed milling: Russia's commercial feed mills are relatively modern, as most were rebuilt after World War II. Daily capacity ranges from 315 tonnes to 1,000 tonnes.
Before reforms, large flour and feed mills often were combined at the regional level and shared the same grain storage facilities. These large feed plants produced complete feeds, but production was based on state tonnage orders, rather than on animal performance.
Smaller feed mills also existed within the collective farm system. These plants produced feed for farm consumption and generally did not use outside ingredients.
The large feed mills now are undergoing the process of privatization. A small but growing number of entrepreneurs also are entering the private feed business, where efforts have begun to improve feed efficiency and integrate livestock and feed operations.
Transportation: Russia has 87,180 km of railroads, all 1.520-meter broad gauge. There are 879,100 km of highways; hard surfaced roads account for 650,000 km, with the remaining roads primarily earth.
Among Russia's maritime ports are St. Petersburg on the Baltic Sea, Murmansk on the Barents Sea, Novorossiysk on the Black Sea and Vladivostok on the Sea of Japan.
Interior ports on the Volga River include Nizhniy Novgorod, Samara and Volgograd.

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