russia & ukrainerussia & ukraine by: regina fayyer & nupur modi

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STATE OF AGRICULTURE IN CENTRAL & EASTERN EUROPE RUSSIA & UKRAINE By: Regina Fayyer & Nupur Modi

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Page 1: RUSSIA & UKRAINERUSSIA & UKRAINE By: Regina Fayyer & Nupur Modi

STATE OF AGRICULTURE IN CENTRAL & EASTERN EUROPE

RUSSIA & UKRAINE

By: Regina Fayyer & Nupur Modi

Page 2: RUSSIA & UKRAINERUSSIA & UKRAINE By: Regina Fayyer & Nupur Modi

RUSSIA

Page 3: RUSSIA & UKRAINERUSSIA & UKRAINE By: Regina Fayyer & Nupur Modi

AFTER THE BREAK UP OF THE SOVIET UNION IN 1991…

There was a substantial food price crisis

Large state farms had to deal with the sudden loss

of heavy government subsidies

Livestock inventories declined, pulling down demand for feed

grains

Area planted to grains dropped by 25% in less than five years

The use of mineral fertilizer and other costly inputs plummeted,

driving yields downward.

After ten years of decline, Russian and Ukrainian agriculture began

to show signs of improvement.

Page 4: RUSSIA & UKRAINERUSSIA & UKRAINE By: Regina Fayyer & Nupur Modi

HISTORY – Brief Overview Largest republic of the Soviet Union

Attained independence in 1991

Capital: Moscow

Decline in agriculture in 1990’s – Economy worsened, food

shortages and crime rate became a problem.

Recovery in 2000

• Regional Distribution: 9 Major Regions – Central European

Region; North and Northwest European Region; Volga Region;

North Caucasus; Ural Region; Western Siberia; Eastern

Siberia; Northern and Northwestern Siberia; and the Russian

Far East.

RUSSIA

Page 5: RUSSIA & UKRAINERUSSIA & UKRAINE By: Regina Fayyer & Nupur Modi

Agriculture & Main Crops Grains (most important) – Occupies more

than 50% Wheat is dominant – First major grain Barley – Second major grain• Corn, sunflower seed, legumes, potatoes,

production of vodka, beets, flax, cabbages, apples, tomatoes, carrots, meat, milk; rich in mineral resources.

RUSSIA

Page 6: RUSSIA & UKRAINERUSSIA & UKRAINE By: Regina Fayyer & Nupur Modi

Imports Top three important partners: Germany,

Ukraine Russia Machinery Vehicles Electric & Electronic Equipment Pharmaceutical Products Semi finished Metal Products Consumer Goods Meat Sugar $260.4 billion

RUSSIA

Page 7: RUSSIA & UKRAINERUSSIA & UKRAINE By: Regina Fayyer & Nupur Modi

Exports• Export Partners: Europe, North America, Japan, Cuba, etc.

• Leading producer in diamonds, nickel, platinum, oil, and

gas

• Petroleum and petroleum products

• Wood and wood products

• Metals

• Chemicals

• Wide variety of civilian and military manufacturers

• $365 billion

RUSSIA

Page 8: RUSSIA & UKRAINERUSSIA & UKRAINE By: Regina Fayyer & Nupur Modi

Illicit Drugs

Cultivator of:CannabisOpium PoppyMostly for domestic consumption

RUSSIA

Page 9: RUSSIA & UKRAINERUSSIA & UKRAINE By: Regina Fayyer & Nupur Modi

Industries & Industrial Production

Growth Rate – 21%

Mining and extractive industries producing coal, oil, gas, chemicals, and metals.

All forms of machine building from rolling mills to high performance aircraft and space vehicles

Ship building; road and rail transportation equipment; communications equipment; agricultural machinery, tractors, and construction equipment; electric power generating and transmitting equipment; medical and scientific instruments; consumer durables.

RUSSIA

Page 10: RUSSIA & UKRAINERUSSIA & UKRAINE By: Regina Fayyer & Nupur Modi

Agricultural Enterprises & Private Farms

• State and collective farms dominate production of most agricultural commodities, including about 85% of grains and over 75% of sunflower seed.

Agricultural enterprises tend to be big - Average size of nearly 5,000 hectares (12,500 acres) - Larger in the spring wheat region than in European Russia.

Private Farms tend to be much smaller - Average size of about 50 hectares (125 acres) - Account for a growing percentage of Russia’s commodity production

RUSSIA

Page 11: RUSSIA & UKRAINERUSSIA & UKRAINE By: Regina Fayyer & Nupur Modi

Conflicts & Difficulties Climatic and geographic factors – Limit

agricultural activity to about 10% of the country’s total land area

Perish of crops due to weather related reasons: Severe frost damage Ice crust or unusually persistent snow cover Heaving Soaking Shortage of agricultural machinery – In poor

condition and machinery is deteriorating faster than it is being replaced

RUSSIA

Page 12: RUSSIA & UKRAINERUSSIA & UKRAINE By: Regina Fayyer & Nupur Modi

FOOD INSECURITY IN RUSSIA• Linked to diets• Children: Low rates of breast feeding, possible deficiencies in weaning practices, lack of Vitamin C and iron deficiencies.• Adults: High fat, high cholesterol, low fiber diet – Low consumption of fruits and vegetables; high consumption of dairy, meat, and sugar, and higher than recommended alcohol consumption.• 5% of population considered to be undernourished per FAO • The Russian Government can greatly reduce health risks in the country by promoting healthy diets and a healthy lifestyle, and by educating health professionals, teachers, and children in principles of a healthy diet.

RUSSIA

Page 13: RUSSIA & UKRAINERUSSIA & UKRAINE By: Regina Fayyer & Nupur Modi

Agri-Food Trading Relationship between Russia & United States

Benefits include: Greater opportunity for all WTO countries Farmers, manufacturers, and service

exporters will gain new, meaningful market access to Russian markets.

Tariffs and non-tariff barriers to trade Operating according to international rules of

trade or be subject to action by the WTO dispute settlement process.

Poultry, Pork, and Beef Agreement - Both American farmers and Russian consumers win.

RUSSIA

Page 14: RUSSIA & UKRAINERUSSIA & UKRAINE By: Regina Fayyer & Nupur Modi

Transnational's

2 Main Agricultural Companies: Monsanto – 2 locations – Producer of

leading seed brands in large-acre crops like corn, cotton, and oilseeds (soybeans and canola), as well as small-acre crops like vegetables

Archer Daniels Midland Company (ADM) - Processes oilseeds, corn, wheat, cocoa beans, oats, barley, and peanuts.

RUSSIA

Page 15: RUSSIA & UKRAINERUSSIA & UKRAINE By: Regina Fayyer & Nupur Modi

UKRAINE

Page 16: RUSSIA & UKRAINERUSSIA & UKRAINE By: Regina Fayyer & Nupur Modi

History

Attained independence in 1991

Decline in agriculture through 1990’s

Recovery in 2000 Agricultural sector

produces 12.8% GDP* Employs a fifth of the population* One of the most important sectors of economy

Capital

Page 17: RUSSIA & UKRAINERUSSIA & UKRAINE By: Regina Fayyer & Nupur Modi

Agricultural Sector

Main crops are cereals, sunflower seeds, and sugar

5th largest exporter of cereals in the world Mineral resources are iron, magnesium, and

coal Livestock farming includes cattle, pigs,

sheep, horses Organic agriculture developed in mid 1970s 28% population employed in agriculture

sector

Page 18: RUSSIA & UKRAINERUSSIA & UKRAINE By: Regina Fayyer & Nupur Modi

Organic Agriculture Dr. M. Schykula Protective soil preparation system: increasing biological soil activity Farm named “Orbij” in the Poltawa region Ukrainian – Swiss project • Development of organic agriculture• Certification, production, and marketing of organic products• Book: “Soil Protecting Organic Farming in Ukraine”• Export oriented organic farms developed in Europe

Page 19: RUSSIA & UKRAINERUSSIA & UKRAINE By: Regina Fayyer & Nupur Modi

Development of organic Farms

Page 20: RUSSIA & UKRAINERUSSIA & UKRAINE By: Regina Fayyer & Nupur Modi

Regional distribution Primarily in South

Ukraine: Odesa and Kherson

Central Ukraine: Poltava

Western Ukraine: Ternopil and Lviv

Conditions are favorable to organic farming

Large vegetable production

Animal production is less important

Focus lies on export products: hard wheat, sunflower, buckwheat

Page 21: RUSSIA & UKRAINERUSSIA & UKRAINE By: Regina Fayyer & Nupur Modi

Ukranian Market Undeveloped Domestic market

lacks activity Organic farming

is fully export – oriented (EU)

Concentrated in a few agro-investment corporations

Small scale production through farmers’ markets

No organic grocery stores present

Page 22: RUSSIA & UKRAINERUSSIA & UKRAINE By: Regina Fayyer & Nupur Modi

Marketing Produce Direct sale off the

field Printed periodical

publications TV, newspapers, and

magazines But, farmers lack:1. Information on sales

markets2. Transportation of

produce3. High purchasing

prices4. Good quality of

produced goods

Page 23: RUSSIA & UKRAINERUSSIA & UKRAINE By: Regina Fayyer & Nupur Modi

International Trade GDP is 115% Main export

partners are Russia, Turkey, and Italy

Commodities are iron, steel, mineral fuels, oils, nuclear reactors, boilers, machinery, machine tools, cereals

Russia is a major supplier of oil and gas to Ukraine

Page 24: RUSSIA & UKRAINERUSSIA & UKRAINE By: Regina Fayyer & Nupur Modi

Problems with farming

Industrialization – caused land degradation

Low technology – caused use of old machines with low productivity

No recycling Irrational use of

land Soil erosion

during tillage

Page 25: RUSSIA & UKRAINERUSSIA & UKRAINE By: Regina Fayyer & Nupur Modi

Food Price Crises Cost of staple items

such as bread, eggs, and vegetables – increased 20 to 70%

Government responds by restricting grain exports

Reduces local supply – higher prices

Private investors – buy and develop Ukrainian land

Poor receive reduced incomes – poverty increases

However, a sustained economy led to decrease in poverty: 32$ in 2001 to 8% in 2005

Page 26: RUSSIA & UKRAINERUSSIA & UKRAINE By: Regina Fayyer & Nupur Modi

U.S. and Ukraine : USUF Non-profit +

non-governmental organization

Facilitates democratic development

Encourages free market

Enhances human rights in Ukraine

Promotes business and economic development in Ukraine and the West

Page 27: RUSSIA & UKRAINERUSSIA & UKRAINE By: Regina Fayyer & Nupur Modi

Transnationals in Ukraine Monsanto 1. In 1997, imported GM

bt potatoes2. Field trials went on for

~ 2 years3. Ukrainian media picked

up stories on GM foods from UK

4. Minister of health refused transgenic potato consumption for humans

5. Monsanto exploited the lack of biosafety rules in Ukraine b/c destroying GM potatoes led to an environmental impact

6. No recourse to compensation

Page 28: RUSSIA & UKRAINERUSSIA & UKRAINE By: Regina Fayyer & Nupur Modi

Transnationals in Ukraine Cargill1. Active in Ukraine

since 19912. Main office in Kiev3. Oilseed crushing,

cocoa trading, sugar trading, juice concentrates trading, vegetable oil trading

4. Invested US $85 million in Ukraine’s agricultural sector

5. Largest project : greenfield sunflower seed processing

Page 29: RUSSIA & UKRAINERUSSIA & UKRAINE By: Regina Fayyer & Nupur Modi

Comparing Russia & Ukraine Both countries do not have

much government support for agriculture

There is poverty among both countries

Both countries have average nutrition, depending on socioeconomic class

Both countries rely on exports to have an acceptable economy

There are some programs and groups that are trying to increase agricultural support, but it is very difficult

Both countries export with other European countries, as well as each other

Imports and exports are similar

 

Page 30: RUSSIA & UKRAINERUSSIA & UKRAINE By: Regina Fayyer & Nupur Modi

CONCLUSION Does the system need a

change?

Yes, the system needs to be changed. Even though agriculture has changed a lot and improved since the fall of the Soviet Union in 1991, the system is not in adequate condition as it should be. This is mainly due to the fact that products are mostly being exported, and not a lot is being imported. Thus, poverty is resulting and increasing. Poor people do not eat at much, and they have to rely on selling products in farm markets. (80% population depends on agro jobs).