Russia’s food self-sufficiency and food security: an assessment

Abstract

The article differentiates between self-sufficiency and food security. The impact of Russia’s 2014 food embargo on the food system and food trade is analysed. Domestic production has increased and Russia has become more self-sufficient in food and seafood. In addition, food trading partners have changed. Western food and seafood trading partners have been replaced by trading partners from Asia and Central Asia. There is a high likelihood that the Russian food market has been lost to Western exporters for the foreseeable future. Even after sanctions and countersanctions end, it is difficult to see the pathway for Western food exporters to recapture market share in Russia.

Keywords:

• Russian Federation
• self-sufficiency
• food imports
• food security
• agriculture
• fishing industry

Notes

1. We note some inconsistency in leadership positions. In December 2017, Vice Premier Arkady Dvorkovich argued that the country was basically food self-sufficient, stating that, ‘at the present time we practically fully provide ourselves with food, with the exception of individual commodities such as dairy products, fresh vegetables and fruits’ (Dvorkovich, 2017).

2. We use 2010 as the start of the timeline because in that year the food security doctrine was signed into force, thereby reflecting policymakers’ concerns about food imports.

3. We note that it is indeed a difficult policy prescription to lower food consumption. In a planned economy, consumption levels were influenced although not determined by supply in state food stores, although in Soviet-type economies consumers had the option to grow food on their household plots. It is not clear how in a market economy this could be accomplished without egregious manipulation of distribution channels and markets. The risk, of course, is the creation of supply deficit-induced hunger or even famine (O’Grada, 2009; Sen, 1981).

4. The largest food aid donor is the United States. In fiscal year 2016, the United States donated food aid valued at $2.2 billion. During 2011–2016, US food aid was given to more than 50 countries and reached in excess of 50 million people annually (USAID, 2017).

5. Increasing food imports may benefit consumers’ food security, but could displace domestic producers and negatively impact their food security. Likewise, lowering import tariffs benefits consumers but puts downward pressure on the incomes of domestic producers.

6. Russia was not considered a developing state, as the World Bank categorises it as a middle-income nation. Further, from what we know, the decision to introduce countersanctions was made independently of agrarian interest groups and not due to state capture. Interest groups did not mobilise to restrict food trade, and the embargo was not due to pressure from an interest group or coalition of groups. Although engaged in low-intensity warfare in eastern Ukraine, Russia was not at war with the West in 2014. The value of agricultural production was growing and so there was little sectoral pressure for protectionism. There was no popular demand from below for the embargo and in fact the Kremlin embarked on a public relations campaign to sell its decision to Russian consumers. Russia was not in a financial crisis in 2014 and had recovered from the 2007–2009 financial crisis.

7. Small enterprises and private farms fared worse, at 66% and 35% respectively (Dyatlovskaya, 2017a). Medium and large farms are also more likely to borrow money. The larger point is that medium and large farms have more capital with which to acquire and expand production capacity.

8. Milk production has been essentially flat for several years – the number of dairy cows continues to decline but milk output per cow is rising. Imports will be necessary to cover consumption for at least the next five–seven years according to former Minister Tkachev. Beef imports are restricted by tariff-rate quotas.

9. In 2008, Russia had 21 million cattle, including 9.1 million dairy cows (Ministerstvo sel’skogo khozyaistvo Rossiyskoy Federatsii, 2009, p. 102). At the end of 2016, those numbers declined to 18.6 cattle, including 8.2 million dairy cows (Ministerstvo sel’skogo khozyaistvo Rossiyskoy Federatsii, 2017, p. 49). The largest decline in cattle is occurring in subsidiary agricultural production by the population.

10. According to the 2016 agricultural census, an astronomical 97 million hectares of agricultural land were unused, far more than earlier estimates that ranged from 10 to 50 million hectares (Dyatlovskaya, 2017b). Previously, Prime Minister Medvedev and former Minister Tkachev went on record that unused land should be brought into production. Even if brought into production, much of this presently unused land will be low-yield because of its northern location but still will increase production, even if marginally.

11. Since 2014, despite economic difficulties from the falling price of oil and ruble devaluation, federal support for agriculture ranged between R186 billion and R242 billion annually (Kulistikova, 2018).

12. Potato production from agricultural enterprises remained steady during 2016–2017 at 4.2 million tons, while in 2017 household production decreased.

13. According to official statistics, the number of people who live in poverty rose from 19 million in 2008 to 19.8 million in 2016, equal to 13.5% of the population (Rosstat, 2017a). In his State of the Union speech on 1 March 2018, Putin indicated that 20 million Russians live in poverty, although he may have been rounding up and official statistics for 2017 have not been published as this article is written. In reality, there are several million more who live just above the poverty level (the ‘subsistence minimum’). These people are vulnerable to food insecurity and consume fewer calories per day and buy less food. It is not clear how much imported food the poor bought before 2014, but with high food inflation in 2014–2015 it is certain that the poor began to buy cheaper domestic products.

14. The primary methods for smuggling are false labelling and re-labelling country of origin. Russia has tried to combat food smuggling, empowering the federal agency Rossel’khoznadzor to seize suspected contraband food at the border or within the country from food companies, retail stores and even individuals. A system of fines has been established. In November 2017, the State Duma began to consider increasing the punishment to include confiscation of the vehicle being used to smuggle food (V Gosdume, 2017). Former Minister Tkachev has supported the criminalisation of food smuggling since 2015, and in December 2017 the head of Rospotrebnadzor, A. Popova, indicated that work on a criminalisation bill was proceeding (Rospotrebnadzor, 2017).

15. If one includes the increased volumes of Russian seafood in transit through China, the increase is 33% from 2010 to 2016.

16. If we calculate the percentage of self-supply based on the 2014-import level, the level would be only 75% (73% if we calculate based on 2010 imports).