Small Agricultural Business Develops in Russia

The state-owned agriculture is demising

The issue about the support of the national agricultural industry has become rather popular of late. Politicians are talking about it all the time - "to support the domestic agricultural producer, to revive the national agricultural field." Yet, words remain just words, and farmers are left alone to deal with their problems again.

Me and my wife - we are farmers, from the American point of view, though. In the USA, a farm is supposed to manufacture and sell products in the sum of $1,000 and more in order to be considered a farm. We have sold flowers and plants in the sum of 32,000 rubles ($1,000), vegetables, fruit and berries were produced and sold in the sum of 20,000 rubles. Our "farm" counts only 800 square meters of a sandy hill-side, the former dump of a factory in the settlement. Of course, the farming success has been presumably accomplished by my wife - she can make any desert blossom.

Is it a lot - $1,000 from a farm? My friends that live in a village - they own hectares of land. According to American measures, there are up to 20 million farming families in Russia, not just 265,000, as it is believed. Seventy-eight percent of the Russian population (about 113 million people) own land. Private land owners possess 26.5 million hectares, which makes 14 percent of the Russian agricultural land.

It is an open secret that a half of the Russian agricultural industry does not work anymore: old machinery, no cattle, drunk workers. All those things can be seen on the Russian television, agrarian deputies talk about it in the Duma: "Give them loans and subsidies, cut fuel prices, remove competitors from the market!" The production of the public part of the agricultural industry has dropped considerably in comparison with the level of 1990. However, the private part of the industry has succeeded a lot. The private agricultural sector has never had any loans, it does not ask to write the debt off - there is no debt. Private farmers do not talk about their problems - probably, they realize that it is no use to complain to authorities.

Maintaining a private farm is never easy, even if it is a rather small one. Me and my wife had back and muscle pains because of our efforts to grow good flowers. But what about keeping some 50 pigs? It seems to be our personal problem too - if we have money, we will be able to buy the machinery and ease the labor. The only thing that we need is to have good sales. However, selling the agricultural production in Russia is very hard and even humiliating. In foreign countries, there are a lot of agricultural marketplaces, even in most fashionable cities. Yet, Russian officials are very lazy to organize them in towns and settlements. It seems that it is easier for them to send armed men to disperse vendors. It does not even occur to mayors, administration chairmen and governors that such activities are shameful for the police.

Farmer markets are either half-closed, or completely sold to monopolists. Small private shops and kiosks that could buy flowers, vegetables or meat have been destroyed with the draconian rent. Yet, authorities say that they do their best to save the small business. It is hard for the agricultural industry to live without the mediation, although it is not supposed to lead to the plundering of both settlements and cities. Farmers sell milk at the price of about three rubles, but it costs 18 or 22 rubles in stores. There is only one way out - a competition: to make buyers line up to manufacturers. A farmer is becoming more important in a Russian village. Successful Russian farmers have agreements to deliver meat, they establish milk productions that have  developed sales networks, some of them can give loans themselves.

The State Duma has done nothing to help small farmers in Russia. Millions of rubles of loans for the agricultural field disappear. Yet, there is a hope. If deputies of the new Duma and new legislative assemblies in Russian regions stand up for the interests of the small agricultural business, there will be no need in the American poultry, in the Australian beef, in the Finnish butter.

Alexander Nikitin
Volgograd