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Socio-economic significance of the agro-industrial complex in the Russian economy

For students

3 min read

ECONOMICS E

Agriculture is the foundation of the country's food security and a key supplier of raw materials for the textile industry, leather processing, and related production sectors. Fields and farms provide raw materials for flax production, sheep farming, goat breeding, horse breeding, and fur farming. Working on the land provides income for 38.6 million rural residents, which is 27.1% of Russia's population, and the share of agricultural workers among all those employed in the economy reaches 13.3%.

  • Self-sufficiency of the country in food — more than 95%
  • Share of agriculture in GDP — more than 4%
  • Share of the industry in fixed assets — 3.6%

One worker employed in agriculture enables on average seven employees to work in related sectors that produce means of production, maintain machinery, and process and sell finished products.

Farm categories and production structure

Land assets and production capacities are distributed among enterprises of various organizational and legal forms. Limited Liability Companies (LLC) and agricultural production cooperatives (APC) hold the largest market share. The table below shows the distribution of agricultural enterprises by management form.

Type of enterprise (data for 2008) Share, %
Limited Liability Companies 41,9
Agricultural production cooperatives 32,3
Closed Joint-Stock Companies 7,9
Open Joint-Stock Companies 6,5
Others (variety testing stations, seed stations, bee nurseries) 5,8
State unitary enterprises 3,7
Collective organizations 1,9
Total 100

In addition to large-scale enterprises, farmers and owners of private subsidiary plots are actively involved in production. For the period from 2005 to 2008, the farmer sector (peasant farms) showed an increase in its share of the gross harvest of grain, vegetables, potato and wool. Private subsidiary plots remain the key producers of potato and vegetables in the country, also providing about half of the volume of milk and meat. Detailed market share dynamics are presented in the table.

Indicator 2005 2006 2007 2008
Number of peasant farms, thousand units 257,4 255,4 255,4 285,2
Agricultural land on average per farm, ha 75 81 81 71
Share of peasant farms in the total area of agricultural land, % 9,5 10,2 12,9 15,9
Share of peasant farms in gross harvest, %:
— grain 18,3 20,0 20,2 21,0
— sunflower 26,6 29,1 29,6 28,9
— sugar beet 10,4 11,8 11,4 9,8
— vegetables 5,7 7,1 7,1 10,1
— potato 2,1 2,9 3,4 5,1
Share of peasant farms in production, %:
— livestock and poultry meat 2,4 2,6 3,1 3,0
— milk 3,2 3,6 4,0 4,3
— eggs 0,7 0,7 0,8 0,9
Share of private subsidiary plots, %:
In gross harvest:
— potato 91,6 90,1 89,2 83,5
— vegetables 80,3 78,3 78,9 70,7
In production:
— livestock and poultry meat 51,0 48,0 47,1 42,7
— milk 52,0 51,0 52,0 51,7
— eggs 25,0 24,0 24,1 24,5

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