FAO/GIEWS - Foodcrops & Shortages 04/99 - RUSSIAN FEDERATION (26 March)
Current indications suggest that 1999 grain and pulse production is expected to recover from last year's extremely low level (estimated at 55 million tonnes by FAO) but to remain below average. Given normal weather, yields could recover from last year's drought-affected levels. Farmers are also expected to increase grain area as it provides an inflation-proof means of payment. However, the economic situation in the country and on farm is expected to make the mobilization of the necessary inputs even more difficult than in preceding years, despite special programmes being devised by the government to assist farmers. The bulk of inputs will have to be mobilized by barter and resources from last year's poor harvest are limited. Economic difficulties in the autumn resulted in a 4 percent drop in the area sown to winter crops, and of the 13 million hectares sown, crops are now reported to be in a poor condition on 1.6-2 million hectares. There is a large backlog of autumn field work to be completed in spring. Spring grain plantings are targeted at 38 million hectares. However, with plantings only just starting in the extreme south, it is too early to judge if the target will be achieved. At this early stage FAO tentatively forecasts the1999 grain harvest at 65 million tonnes, including some 33 million tonnes of wheat (1998:30) and 30 million tonnes of coarse grains, unchanged from last year.
Following last year's poor harvest, the overall food supply situation is not critical but stocks are being drawn down sharply and feedgrains are reported to be short supply. However, at the forecast level, this is inadequate to meet current domestic demand, estimated at about 70 million tonnes per annum. The outlook is for the grain supply situation to remain tight also in 1999/2000. The price of food quality wheat has doubled since May 1998 and that of feed barley has increased even more. However, at US$87 and US$57 per tonne, they remain well below international prices. The differential between domestic and international prices for grain has resulted in exports of about 1.3 million tonnes up to February 1999. The governments have banned the signature of new export contracts for grains, but grain will continue to be shipped against contracts already signed.
Despite the poor harvest, cereal imports in 1998/99 are not expected to exceed 3.5 million tonnes, the same as 1997/98. The country has received food aid pledges amounting to 3.8 million tonnes of grain (as well as meat, dairy and soybean products). The first food aid shipments have just arrived and the bulk of the shipments (not rolled over to 1999/2000) should arrive in the lean season before the 1999 harvest, when the aggregate supply situation could tighten.
People in remote and disadvantaged areas are experiencing hardship as a result of steady economic stagnation, the reliance on increasingly expensive imports of food, and sharply reduced purchasing power. This year, the situation is worse partly because reprovisioning in the summer months was disrupted by the financial crisis and partly as the cost of transport, without subsidies central government subsidies, is prohibitively high. The most vulnerable socio-economic groups, pensioners, orphans, the unemployed and households dependent on public salaries are also experiencing difficulties, especially in large, depressed industrial cities.
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