Soviet Agriculture and the Post-Soviet Transition Period

Agriculture is one of the three main sectors of the economy, along with industry and services. It is indispensable for any country. Even if some food must be imported, it is always a good idea to rely on local sources for most staples—grain, milk, and meat. Agriculture includes farming and ranching, along with some less important areas, such as beekeeping and aquaculture. Ironically, the steady improvements in agriculture during the worldwide Green Revolution have put this sector at a disadvantage in all countries: As more and more efficient methods of growing food were introduced, fewer and fewer hands were needed to work on the land. This has resulted in the decline of the family farm, an exodus of cheap labor to the cities, and a sharp decline of the agricultural sector relative to the other two. This is of course a familiar scenario in the United States today, but it is also now happening in India, China, Mexico, Brazil, and even Africa.

The agriculture of the Soviet period was dominated by two forms of state farms: kolkhozy and sovkhozy. The former were collective farms made up of village farmers and, theoretically, cooperatively owned, and the latter were Soviet agricultural enterprises with state workers. Few actual distinctions existed between the two in the late Soviet period. Another time-honored tradition inherited from the Soviet period was the suburban dacha. Because the collective farming was notoriously inefficient, people were tacitly encouraged by the authorities to take care of themselves and to grow their own food. Small plots of land (averaging 0.06 ha) were grudgingly given out by the Soviet authorities to the urban residents, so that some food could be grown around cities. Vegetables and potatoes were most commonly produced, and sometimes apples or flowers. Villagers had slightly larger plots of land (usually 0.10–0.20 ha) immediately next to their houses to grow their own food. While all of this land was state owned, people were free to choose what to grow on their dachas, and they were doing it for themselves. This resulted in surprisingly high yields: A typical family of the late Soviet period would grow and can enough vegetables and fruit to last for about half of the winter. These tiny plots yielded an astonishing 30% of the total agricultural produce in the country in 1980, and yield even more today. There was not enough land, however, to grow wheat or corn on dachas. Livestock was also kept by the villagers close to home; in a collective farm setting with 2,000 state-owned cows, a few households would manage to keep a cow or two of their own. Pigs and goats could be raised at home as well. The urban dacha owners would typically not be able to keep big animals, because they could only be there during the summer vacation and on weekends, but even they sometimes managed to raise a few chickens or rabbits.

Because Soviet agriculture was so inefficient, the Soviet Union had to import about one-fifth of its total calories by the early 1980s, making it the largest single importer of food on earth. The most common imports were wheat from Canada; sugar from Cuba; and vegetable, fruit, and meat from the Eastern European countries. In exchange, the U.S.S.R. sold grain, fossil fuels, timber, fertilizer, and metals on the world markets. In a sense, little has changed for Russia today. During the 1980s, the Soviet Union grain exports alone amounted to 30 million metric tonnes (mmt) per year, about as much as was grown in all of Turkey. The total grain production was then about 150 mmt per year, while the United States produced about 300 mmt. About one-quarter of all economic expenditures in the Soviet Union were on food.

Agricultural reform was certainly on Gorbachev's agenda: The short-lived Food Program attempted to boost domestic production in the mid-1980s, during his tenure as one of the secretaries of the Central Committee of the Communist Party. However, given the absence of economic incentives to produce more food, the state farms were reluctant to grow more. Real agrarian reform would require many years of the post-Gorbachev period, and is by no means complete even today (Wegren, 2005). Although the reformers' initial hope was to quickly create millions of private farms, more or less U.S.-style, this effort has been largely unsuccessful to date. Russia had only 300,000 private farms in 2008, producing 9% of the total agricultural value. The largest producers in the country remain the former state farms, with over 50% of the total output. They control 76% of the land in cultivation and are now reorganized into “stock ventures,” with much of the ownership concentrated in the hands of a few people who have ties to the farm directors (Wegren, 2005). Workers do own shares in the farms, although few are able to meaningfully exercise their stock owners' rights. In contrast, private farms control only 20% of the land, and the small private plots 4%. Table 20.1 details the output by the three main forms of ownership in 2008. It is interesting to note that despite some gains for the private farms and some decline for the big agricultural enterprises, the people growing their own food on dachas are the ones who continue to produce the bulk of Russia's potatoes and vegetables, and a large share of its meat.

tructure of the Russian Agricultural Sector (%) with Respect to Ownership and Output Levels

The agricultural sector was hit hard by Yeltsin's reforms. The state subsidies were abruptly discontinued; competition from Western producers surged; and seed stock, fertilizer, pesticides, and equipment became prohibitively expensive. The overall agricultural output fell by 30% between 1990 and 1995, and an additional 10% by 2000. There was a proportional dropoff in the harvested acreage: Today Russia harvests only 65% of its former fields. The more recent period has seen a slight increase in production, at the rate of about 3–4% per year. This, however, is not yet enough to make a real difference in the trend. Russia has about 77 million ha under cultivation, a decline from the 118 million cultivated during the late Soviet period. Much of the abandoned land has been reverting to forest, as can be easily seen on satellite imagery collected over the past 15 years (Kuemmerle et al., 2008). Much of the farmland in the former Soviet Union (FSU) is also heavily polluted with pesticides (e.g., areas of the northern Caucasus, Moldova, and the “black soil” belt of Ukraine and Russia). Still, Russia has the third largest amount of arable land in the world—behind the United States and India, but ahead of Canada or China. There is 0.8 ha of arable land available per citizen, as compared to 0.6 ha in the United States or 0.09 ha in China.