Agricultural production may fall by 2% this year

Agricultural production in Russia will decrease by 2% this year. The head of the Ministry of Agriculture Dmitry Patrushev said this at a government hour in the State Duma. Next year, according to him, the index of agricultural production will increase to 101.3%, the index of agricultural production - up to 101%. In 2020, agricultural production increased by 1.3%.

According to the minister, the profitability of agricultural production, taking into account state support, will be 23.4% in 2021. Patrushev noted that seasonal field work is now almost completed. “The year has been extremely difficult for farmers. Starting from the last winter sowing and throughout this year, the weather has constantly made adjustments to the agricultural production process, and a natural emergency regime has been declared in 16 regions. And, of course, our industry, like others, is being affected by the pandemic,” he said.

Patrushev also said that the harvest received this year for the main positions exceeds the figure planned in the state program. According to the Ministry of Agriculture, the volume of grain harvest in net weight will exceed 123 million tons, including about 76 million tons of wheat. “This fully meets the domestic needs and export opportunities of our country,” the minister stressed. In addition, 23 million tons of oilseeds, more than 40 million tons of sugar beets, and about 7 million tons of vegetables will be harvested. All these figures are higher than last year, he said. The potato harvest in the organized sector, according to Patrushev, will exceed 6.7 million tons, in addition, the record for the collection of fruits and berries will be updated.

Speaking about the prospects for 2022, the minister said that, together with the regions, the structure of sown areas for the future harvest has been worked out. “In general, the area will grow by more than 1 million hectares. An increase is planned for spring grains, including buckwheat, sugar beets, rapeseed, and soybeans. We will pay special attention to increasing the production of potatoes and open field vegetables,” he said.

Vice-President of the Russian Grain Union Alexander Korbut said that the increase in agricultural production will be in the region of 0-0.5% compared to last year. The reason for the low performance is the reduction in production volumes. “Moreover, the decrease in grain harvest showed that it is a more significant driver for crop production than other agricultural crops. According to the reports, we got a good harvest of sugar beets and oilseeds,” he said.

 In addition, livestock production is not showing significant growth this year, Korbut noted. This does not only apply to milk production. “All these factors lead to the fact that the production of agricultural products will be lower, which may lead to market stagnation. I would not associate this only with natural and climatic conditions, African swine fever and bird flu, although this is very convenient, since these are factors independent of us, ”Korbut argues.

He connects the problems with the fact that the policy of prioritizing support for holdings and large farms has exhausted itself. “Farmers and other small farms provide a large volume of production and grow more steadily. However, most of the resources are inaccessible to them, everything goes to the big players,” says Korbut. Another factor he called the reduction of incentives for active production, which is associated with "excessive and not entirely rational state pressure on producers."

Since the beginning of the year, Russia has reduced imports of meat, but increased imports of poultry and fish 

During the government hour, Patrushev also said that the export of agricultural products from Russia by the end of the year will amount to $35 billion. Earlier, the Ministry of Agriculture predicted that the volume of agricultural exports would be at the level of $34-35 billion. The minister noted that special attention is paid to the supply of products with high added value. “Now it is taking an increasing place in the structure of foreign trade, for example, exports of confectionery products this year increased by 20%, and drinks - by 35%,” he said. According to Patrushev, the volume of exports was affected by the rise in world food prices.