[OEft ProjectI
TABLE Of COKlEMli
X. IKTBODUCTIOW II. HACKII. PLAN AHt PEBFORHANCE,
Production
rop Shortfall and Its Effects
THE TENTH FIVE-YEAB PIAH
The Private Sector
Hon-Black Scil Zone Prcgran
APPEBDIX: HEASUBIBG SET AGfclCUITOFAI EiCEUCTJON
abic 2
TdDle 3
able 5
Tableaole 7.
Table tl. Taole 9.
Tablw
USSR and US: Agricultural Profile, SSR: t'lanncd aad Actual Prcdocticn ot Rajor Crops and Aciaal Products, Selected Years
OSSfi: Indexes off Erecipitatioo, Octolcr Through July, ana Grain Yield, B: Exports and Isccrtr of Grain USSB: Planned and Actual Output Daring Tho Ninth Five-Year flan Period USSR: Livestock Irventcrics USSR: Deliveries cf Machinery and Equipoent to Agriculture, Planned and Actual
OSSB: Efforts te Isprcve Cccr-laGd, Planned and Actual
USS2: Average Annual Cutput of Bajor Crops and AniBdl Erodocts, ian and Actual, lat and Actual, and lan
USSB: Investment ia the Ncn-Black Soil Zone (fcfcSZ)
Appendix tableppendix tableppendix table 3:
Appendix table 4:
Appendix Tab1es
USSR: Index of the Value of Net Agricultural
USSR: Indexes of Agricultural
USSR: Production of Commodities Used in Net Agricultural
USSR: Value of Net Agricultural
ii
bO
51
3
? AGE 1
SOVIEt AGUICUITURE: C BUT IIF(FEAAC E AND EUTUBE
Aftoe over fifty years of Communist rule, the OSSB is entering its Tenth Five-Year Plan with reported demonstrations over foodaradoxically, daring tho last decade, agricultural output increased substantially. let Brezhnev's program to provide consumers vith more neat pushed demand for grain tar reyond dooiostically produced supply.
Under Brezhnev, the dssp's ran sectci has received consistently generous support in expanding the resource base. Although rapid growth in investment and in the flew of industrially produced materials such as fertilizer, lubricants, and electric power has helped boost the general level of agricultural production, itot stabilized farm output.ides of progressively tetter harvests in the, farm output, especially when measured simply by the size of the grain crqp, fluctuated substantially during the past five years. Fcr example, twe years after theillion ton grain harvestJ, the Soviets
Le Figaro,
PAGE 2
suffered their worst cropecadeillion tons.*
Two barvost shortfalls during tbe Hints Five-Year Planrecked planted gcals, slowed economic development, contributed tc record hard currency deficits, and jeopardized the gains made ty the consumer. Tbe backbone of tbe regime's consumer program hascheduled improvement in diets, syabolizedapid expansion of meat output. To attain seat goals quickly, livestock herds were expanded rapidly without first ensuring adeguate supplies of food grains. Had tbe OS SB been favored with an extended period of excellent weather this gamble vould probably have paid off. However, tbe combination of the livestock program's nearly insatiable demand for grain, the leadership's commitment to tbe consumer, and bad weatber forced the Soviets to purchase massive amounts of grain fron the west. Grain imports inere sufficient to avert substantial herd reductions, but even larger grain purchases5 were inadequate to prevent large-scale slaughtering of Livestock. The Ninth Five-Year Plan thuc ended cn a
* Official Soviet data fcr giain trcdocticn are used in this report. Oa ta include production of wheat, rye, tarley, corn, oats, millet, buckwheat, rice, and pulses. Figures reported areankerhich ircludes excess noisture, unripe and damaged keirels, weeo seeds, and ether extraneous materials and has not been adjusted to reflect post-harvest losses incurred in handling and storage.
PAGE 3
discordant note, one which will be heard for at least the cooing year.
Despite these setbacks there apparently has beer no basic change in agricultural policy or tbe policy to improve the lot of the consumer*harp downturneat production is to increase rapidly during the next four years. Average grain outputs to juap by one-fifth over the average for the previous five years, in addition, the Tenth Five-Year Jlan continues tbe effort to iaprove the quality of farmland and to increase tbe use of fertilizer, key factors in raising crop yields. Ibe rate ot growth of total investment will be sieved, honever. Agriculture's share of total investment will be maintained, but yearly flows of machinery and ether investment goods vill grow markedly slower than in tbe past* This slot-down probably does not stemclicy shift. Instead, it most likely reflects the economy-wide program to increase productivity and prod uct quality in lieu of large new inputs. Planned productivity increases notvithstancing, output plans for key coamodities have net been relaxed and are perhaps overly ambitious. Planners are apparently heping anew Hoc ait extended period ot tettec-than-average weather.
lb is paper briefly reviews the cccstiaints under which agriculture labors, discusses the agricultural achievements
PAGE U
during the past fiveon agriculture's
performance5 and its impact on the rest ofconomyand examines the Tenth Five-Hear Plan goals released thus far.
The Soviet farm sector has made considerable progress in the face of serious environmental constraints, constraints that include highly variable weather conditions. Agricultural production generally is sufficient to provide consumers vith enough to eat in teres cf daily calories, even though their diet is heavily weighted vith starches and deficient in meat, vegetables, and fruit* Environmental factors notwithstanding, however, the agricultural sector given the resources invested and the products obtained suffers from low productivity ard ineffective nanagement.
The environmental constraints en agriculture are formidable. Three-fourths ot the OSSB's sown area is climatically comparable to the Erairie Provinces of Ccnada and the Northern Great Plains area in the United States. As in these analogous areas, the Scviet Onion's agricultural laud ia relatively deficient in hea ticist ure, and nutrients. Almost one-third cf the USSB is tec cold foe
PAGE 5
agriculture, and an auditicnalf th& is so cold that only hardy, early-maturing crops can be grown. Only in the southern USSR is the available warmth sufficient toide range of crops* floisture deficiency isajor problem* Drought-resistant flant varieties are being developed and dry-farming techniques improved, but irrigation remains the most effective scluticn. Irrigation, however, is costly in both capital and labor, and in some regions soil deterioration makes the benefits of irrigation difficult to sustain* The Soviet Union has some comparatively good soils, but natural scil fertility suppliesart of plant rutrientoper pairing of soil and crop, correct crcp rotation, and large quantities of organic and mineral fertilizers and of trace elements are necessary*
esult of these and ether factcrs, the farmland of the USSH is less productive tharf the Cnited States* Evenarger area under crops in the Soviet Union, production is less than in the US (seeoviet agricultural output was aboutercent of the US levelince that time the value cf Soviet cut put has increased by aboutercent and by thetood
EACE 6
TABLE 1
USSH S: AGBICUL1CBAL PROFILE ,4
Agriculture's share of Gross National Product (percent) a/
Agriculture's share of the labot force (percent)
New fixed investment in agriculture per workerercent of new fixed nvestment per worker in industry (percent)
Area sown (nillion hectares)
Fertilizer application (million tons of nutrients)
Stock of agricultural machineryractors Trucks Combines
USS1 as a
Fcrcopt ot us
6
5
9
4
output: Food grain; c/
area (aillicn hectares) production (aillion tons) yield (centners per hectare)
8
3
C. 1
grain; e/
area (million hectares) production (million tons) yiuld (contneis per hectare)
6
1
9 :
(million tons)
.0
(million tons)
:
i 1' (million tons)
EfiGE 7
Footnotes to 1ABLE 1
of GNP at factor cost originating in agriculture infor the OSSB and2 prices for the US,
rye, and rice.
Soviet production data ainus an estimated 3loss and anercent waste resulting fromand extraneous matter. See fcotncte en page 2.
oats, and barley.
weight equivalent. US data exclode edifclerabbit, poultry game, edible offal, and lard).
milk.
so^hc^G^ Data are in large part found in Survey of Currentcr theodu for the USSB. Eethodology fcrdataUSSB is discussed in PSSB: Gross national Product Accounts,IntelligenceB), Noveaier,b.
PAGI 6
at about three-fourths of U5owever, Soviet facm output is still dominated by breadyrains and potatoesthe USSR normally produces about twice as much wheat as the United States but less than one-tenth as much corn while output of higher quality feeds, particularly meat and fruit, lags far behind that of the United States and is not sufficient to satisfy the growing deaands cf the Scviet consumer*
roblems compound the effects ofonstraints* Agriculture has been structured with emphasis on control rather than efficiency. Horepvcr, in terms of managment and labpr, agricultureasesidual claim rt.on sequence, productivity is low. The USSB maintains more than one-fourth of its labor force inarm labor force eight times the size of the agricultural work force in the United 5tacenti ves, in the torn oi both monetary rewand improved living conditions, have not been sufficient to keep the younger, better-trained workers ir the ccontryside. Hore
*ore comprehensivecf agricultural production in the two countries, see F, Douglas Uhitebouse and Joseph F, Havelka, "Comparison of Farm Output in the US andl-S. Congress, Joint Economic. Government Printing Ottice,
PACE 9
importantly, the institutional setting has tlunted the ef foctivenoss oi the massive resources invested in agriculture duiing the last decade.
the Ninth Five-Tear Flan periodixture of success anderiod difficult to characterize because of the extreme year to year fluctuation in agricultural output. Years ol record and near-record ontput wero interspersed with harvost failures. On balance, though, it must haveisappointing five years ror the leadership. Investment goals were consistently met, but output targets were almost as consistently missed. Moreover, agriculture's problems disrupted overall economic growth, and large expenditures of hard currency were reguired tc cuy grain in order to keep the livestock program from total col la pso.
usiici!
Farm output oscillated during the past five years. For the periodhole, net production fell at an diurnal average rateercent, with crop production
PAGfc 10
percent yearly and output of livestock productsercent (see*
These figures mask agriculture's performance, hcvever, reflecting the good baseC and the disastrous terminalutput held at0 level butercenthe resultevere winterunner drought centered in the Volga valley, fin expansion in sown area and good weather led to record productionn increase of alucstercent with crop output upercent fcr the year. The followingate summer drought in eastern Kazakhstan, among other problems, cut crop productionercent, tut livestock productsercent, keeping the total value of fare output close to3 record. Finally,rolonged drought that affected xest cf the Soviet Onion's croplaod cut the size of the harvest anotherhortage of feed led to distress slaughtering of livestock, mainly hogs and poultry. Livestock productsercent and not agricultural prcducticnercent.
* Met agricultural production is the estimated value ot agricultural output for sales and bene censun (ti on,0 prices, minus farm products used fcr seed and livestock teed and including changes in inventories of livestock. For additional tabular materialhort discussiou of the methodology used to measure net agricultural prcducticn, see the Appendix.
Fl. ANNEp *KD ACTUAL ?KOt>UC0riCh OF ,'ftJCt CtC?i AM JXiniLYEARS
Actual
Acta* 1
Elan
--fate oi Growth (Fercent)--
Fotal value of
tain output a/
a
b/
3
products c/
i
3
oC xajor
consodi ties
ai
ifl
.B
2
-i
beets
2
.2
c/
seeds
A.
.-i
0
3
A.
3.3
2
IS .S
3
1
(thousand tons)
A.
9 B
<i
(billion)
8
1
i. Agricultural output tor sales and hose consumption iIdos faro products used fcr seed and livestock feed. ?nceeights0 have bees used in aggregating the physical output of cropi and acini products lincluding chances in inventories of livestock).
of food and technical crops loss seed but including the portion fed to livestock.
of output of aeat, ails, eggs, wool, and other livestock jrcduct! lece livestock feed and adjusted forr. herd inventories.
for growth of gross voluae of agricultural output.
using tbe iaplied average annual rate of growth detived froa production data in tfceyear andin temioai years.
SSyjCtS^ Production statisticsroo Jfarsfigoi'e^khojjajstvodUj selected years. Cata :orfroa preliainary press reports. Plan datareIra*3a* ApriliJIJlllSillij' iarSlDPgG i ; cgdy, page and for
Eravda^ torch
pace 12
Soviet officials tend tc blaie the veather foi agricultural shortfalls, while tiiely organization and good management are given credit for successful ciops. Paradoxically, however, weatheras generally good and relatively static. Average cumulative precipitation for October through July during this time was higher than any five-year cericd0 (see Tableeriods of good weather and ecoroiic planning periods dc not always coincide, unfortunately. Average annual precipitationas about the sane as.lso shows that no single weather variable explains yield. The temporal and spatial distribution cf rain is difficult to measure, aod short-lived weather ihcncBcna, such as the hot, dry winds known as sukhovey, often do not appear in weather statistics but canarked effect on crop yield. For oxaaple, cumulative precipitation3 wasercent loss thanut yield wasercent greater. Precipitation was higheru than3ate season sukhovey, which could not be detected on monthly weather summaries, cut yields. Nevertheless, precipitationough measure of yields.ainfall was siiilar2 and as was yield.
Production of grain, the USSR's most important crop, fluctuated widely. flans for an average
PAGE 13
TAELE 3
USSB: INDEXES CF T ATIC*, HBOUGE JULY. AND II YIELD,
Index of lotal
of
Yield b/
= 1'OOJ
5
9
verage,
in millimetersvailable through the1 Organization reporting systemweighted byof the area sown to graiu
yields of all grain io centners perngyg_vaodu , selected yea rs.
PACE 1U
harvestillion tons Here unrealized. The actual average crop wasillion tons, with the plan tor individual years net only oncey the record crophe variance in tb* size of the grain crcp, as measured by the deviationong-term trend line, far exceeded the variance in production during the Seventh and Eighth Five-year Elan periods.
Hore iaportant than the unfulfilled plans and the variations in production, the USEE was twice caughtoor harvest and the livestock program's growing demand for feed. Following the badarvest, purchases cfillion tons of grain froa the West, worth5 billion, were enough to forestall distress slaughtering and tide the prograa over (see Table. The Bore serious shortfallowever, resulted in purchases ofillion tons during fiscalhich ccst7hese imports, ovenumfcer ot conservation measures, wore not enough to support livestock inventories.
Plans for other crops wore also generally unfulfilled (seeotton, which is primarily grown on irrigated
* For delivery during fiscalillion tons were bougbt tcr delivery betweeo June andnile further purchases were made for delivery after October.
TABLE 4
USSB: EXECFTS JKC IRICSTSIH a/
Thousand metric tens
al Year b/
Imports
d/
grain eguivalent cf flour, convertedate, and groats.
are for fiscal years ending Junef the stated year.fiscalre an average cf tne calendar years.
purchases cn Soviet account fcr shipment tocountries and other client states.
SOURCES^cdx selected years and press accounts of grain trade.
PS g
"p l
? If I
PAGE 17
land, was the notable excepted uc tier, oi cct tonev high each yearhen output fell slightly but remained above plan. Only in the record3 did production or other crops exceed planned levels*
lhe record for the livestock sector is somewhat letter, in large part due to the massive grain iiforte. The value of livestock inventories grev at an average annual rateercent* Cattle inventories in tht socialized sector grew steadily while in both private and socia lized sectors the nunber oi hogsheavy grain consumersdropped2 acde feed supplies became scarce. Heat production gcals, which were reduced following the harvest problemsere net every yearhen the target was missed byons. Had prenature marketing of lighter-than-normal animals not been necessary duiirg the fallhis goal would also undoubtedly have been aade. Egg production exceeded planned levels throughout the period, uhilt oilk and wool targets were*espectively.
B. 5 Crop ShgrtfaU_and_Itg^iffgctsrop tailure was the worst during the trezhnev period, jeopa idi zing the much touted progratr to ia prove consumers' diets. Production of all major crops, suffered
PACE 16
from the severe drought. The IMC million ton grain crop was roughlyillion tons below tbe average* and the worst in the postwar period when treasuredeviation from the long-term trend. Output of ether lajcr crops such as sugar beets and sunflower seeds an important source of vegetable oilwas alsoH levels. further* the drought dried- up pastures and reduced supplies of fprage crops, compounding the shortagefeedgrains.
Grain production was less than tuc-thirds of needs, hitting the livestock sector the hardest- lhe regime did everything it could to maintain herds, using such stcpgap measures as shipping animals from drought to non-drought areas and feeding reeds, leaves, and ether lev-grade feed stuffs to starving livestock, in addition, normal grain exports were apparently cancelled. Finally, the USSB contracted for aboutillion tons of foreign grain ror delivery byn this connection, the Soviets for the first time committed themselvescng-tera grain import agreement with the United States fcr the purchase of
FAtih 19
6illion tons per year tor the five years beginning October, *
Despiteed suplies vere inadeguatb.esult, state and collective far as began distress slaughtering ot bogs and pcultry by late suuer*nors, vho provide about one-1hi id cf the ccuntry 'snd ovn over two-fifths ot tht hogs and cattle and about halt of tbe poultry, followed suit. CCnsegcently, inventories of bogs and poultry droppedercent and IS percent respectivelyheep and cattle wer* relatively unaffected (seuespite the sharp decrease in tbe number ot animals during the fourth guartor oteat output did net itcroast noticeably, Fart of tho reduction in livestock nuabers reflected decisiors to reduce farroving and hatching rates, while tbe prematurely killed animils were underweight.
In general, the consumer was unaffected5 by agriculture's problems. An invectcry cf processed foods, coupled with the usual lagrcp shortfallownturn in livestock production, Xept ereugh feed in tho
* Under the terms ot the tigrecment exceptions can tthe US may sell lessillicc tec* it ithortage. It may sell moreillicn tors if the USSF nood is exceptional and US supplies permit.
I
i "
is
m
ill
ill
m
m
PAGE 21
marketing pipeline. Forhcle, per capita food consumptionercent and meat consumption wasercent,ecord level. Heat prices rose in the free aarkets, hut this %as due net to shortages but rather to higher incomes and greater demand* *
Because agriculture accounts fcr roughly one-fifth of Soviet gross national product, growth in GNP slumped toercentownercent inand an average annual rate ofercent. Cther sectors of the economy were not visibly affected byroblemsndustria1 output in particular equaled the average annual rate achieved foreriod. lhe rate of growth io the pther principal sectors either maintained the same pace (services and transportation) or fell moderatelyhe delivery8 billion worth of grain, hewever, combinedapid rise in oost categories cf itpcits and very little export growth to push the Soviet hard-currency deficit5 to aboutillion.
The main impact of crop failure is being felt
* Id addition to the state -run retail network, some food products are sold in collective lain sackets .here faiaers sell excess produce from theii private plcts and there prices fluctuate according to supply and demand.
PAGE 22
this year. The consumer has beer hardest hit, but growth of industrial production and GUP disc arc Doing slewed, and the Soviets continue toarge hard-currency trade deficit. Moreover, the USSB's agricultural situation retains precarious vith carry-over stocks of grain depleted, livestock herds reduced, remaining livestock underfed; and output goals dependent on above-average weather.
Probably the most serious probies6 is the expected drop in neat consuipticn. At the beginning o% the year, domestic and imported feed supplies were not sufficient to support already reduced livestock inventories. Distress slaughtering continued during the spring, tutimals continued to be slaughtered at lighter-than-normal weights meat production dropped off. Heat production in government-operated packing plants during January through April was offercentear earlier, with production in March and Ajril2 percent from last year. Heat shortages were widely reported in the Westerns feed supplies improve during the summer and fall assuming normal weather and a reasonatle crop
* For example, seeeatless Cay Eegun in Moscow,"KaySc*iet Bishhe^ Bash ir^ton_,, and "Soviets Quietly Cut Meat Content inuneage All.
23
outlookefforts to rebuild tat average height of aniaals io order to support breeding atd get the livestock prcgraa back oa track aay keep aeat procucticn at depressed levels.
Per capita aeat consuaptiot6 aay drop as auch as one-guarter. This would return the consumer to the level of the. Although per capita consumption of meat has increasedercentndercenthe average Soviet citizen still eats enly tho-fifths aa much meat as his OS counterpart and tbree-foorths as much aa the average Pole or Hungarian.
Id addition, an expected downturn in egg and Bilk production5 levels, albeit less severe, will further erode the quality of the Soviet diet. This dectease in availability of livestock products will temporarily reverse the steady decline in the share of starchy staples in the average Soviet diet. Uread and pctatces currently account for about one-halt of tho calories consumed.
Agriculture is expected to slow GUI growth againven if favorable weatherubstantial expansion in crop production, theercent rebound io farm output forrojected ir the five Tear appears optimistic. Despite the iiprcveient in feed supplies that such weather wculd bring, prediction of acat will drop in b and cannot expatd substantially until
PAGE 21
livestock herds buildain. This takes
year or sc for pigs, out several years torputs
lhe tarn sector's problemsere not tne resulteduced commitment to agriculture. Kescurca flows to agricultureteadily and were not cut back after bumper harvests. Acbiticus plans fcr agricultural investment and for the delivery of machinery and materials to tho faros were, vith only minor exceptions, set.
Hew fixed investment durint] the last five years greb at an average annual rate ofercent, faster than the rate achievednd planned. Moreover, investment in agriculture grew almost two-thirds faster than investment in the remaining sectors of the economy.esult, agriculture^ share of investment for the five-year periodhole amounted to aboutercent. *
In addition to direct investment, farms benefit from investment in other branches of the eccnesy. When
* Includes productive investaeot, such as the purchase of agricultural machinery, as well as investment for non- productive purposes such as housing. Alone, productnvestment in agriculture aaounts tc abcutercent cf the economy's total investment. In the OS, productive investment in agriculture is lessercent of total investment.
FACE 25
agiicultutr is defined iD its. idest ten* to include additions to product ion capacities ir biaocbei sufjciting agricultural developaent, "agricultural iovesteeot" grew at an annual average rate ofercent during the Hinth Five-ioar Plan period and absorbed slightly sore thanorcent of tho econoay's investment funds.*
Support of agriculture froi industry alec generall) net planned levels. Deliveries cf tiucks and agricultural nachioecy grow steadily, meeting or slightly exceeding tho plan (sea The ouibec cf tractcrs and combines
* Since the beginning of the finth Five-Tear Plan,aad plan fulfillment reports have presented agross fixed investment in agricultuie that include!for such iteas as construction and equippingshelters, irrigation and drainageexpenditures for tractors, transportmachinery andnvestmentof housing, schools, clubs, hospitals; andexpenditures for construction of repair enterprises, for
development of various construction en te ipri see, and otherntering into ths ccuplex cfoi thu development of agriculture.
A second and larger concept of gross fixed investment in agriculture has alsc eaetqed, that is, grois fixed investment iu agriculture and tranches mpporting its development. This concept includes gross fixed investment as defined above andross fixed investment io additions to production capacities in branches supporting agricultural development (fcr the icst pactanches)ross fixed investment in housing constuction in rural areas financed with funds ol collective farm members and Mage and solar* vcikers. Hhile scac data regarding these expenditures are available fcr6 Plan, do data are available for the C Mat as a whole.
f
r
!=
S.
i'
=
r
PACt 27
sent to the fa:.'. narrowly aissed planned goals,ipieiit of newer, greater becsepewer aachices upgradedpacks. Efforts to improve cropland also continued. Deliveries of fertilizerittle acre thanillicu teas per year anda Billion tonsOCove plan (see lableine, needed to neutralise acid soil and to aayioize the beneficial effects ot rertilizer, Mas applied tc an averageillionillicr hectares atone the yearly average. The gross addition of irrigated land far exceeded plans while the area drained was somewhat short of the target.
Although total deliveries of aachinery and cross addition of irrigated and drained land are iapressive and reflecthigh priority for investment funds, they can be somewhat misleading, fietireient rates are high, and stocks, whether tractor parts cr area under irrigation, grow oore slowly. For example, althoughillion tractors andcombines were delivered to agriculture, parks grew byC, respectively. Retirement rates of inproved land are wen signer, averaging roughly one-quarter of gross additions.
rs;
s psss
PAG* ;g
IVth fAve-Year Plan
The Tenth Five-Year Plan has already been tarnished by5 crop disaster. In contrast to the last five-year plan, whicheries cf relatively successful years, the present plan is beginning uith shattered momentum in tho agricultural sector, depletedopulation unhappy abouthortages, and an economy that is vulnerable to furtherasic agricultural policy has not been changed, however. Indeed,options are available to the leadership*
Output plans for the Tenth Five-fear Plan are generally consistent vith or above long-term trends. Tbe targets for livestock products have been cut back in response tc last year's harvost disaster but remain tied to an ambitious herd rebuilding program. Cn the other hand, the planned growth in the flow of resources to agriculture, altbcugh in keeping with the investment program fcr the rest cf the econcoy, has been sharply reduced from the last five-Year Elan. Deliveries of fertilizer will continue to grew at an avtragt annual ra te of aboutercent, but lit tie expansion in land melioration efforts is planned, and deliveries ot equipment will grow only slightly. ttajcr increases in
PAGE 30
productivity aust there!ere be realized and weather conditions oust be above-avtrage if the agricultural targets are to be net.
The gross value of output cf agricultural production is to increase at an average annual rate ofercent, This rate exceeds the growth planned. At first glance this increase appears only moderately ambitious, based as it is on the had shovinguccess, however, will depend largely on the size of the grain crop.
Grain productions tcillion tons yearly (seerain production6 is plannedillionf6 plan is net, productionould have to appear somewhat as follows,erage annual ra te of growth, iflan is to be fulfilled.
* Planned grain production inas givenercent higher than average annual production in the Ninth Five-Yearillion tons-
PACfc 31
Grain Production (million metric tons)
207
2 li
217
223
Ihe overall grain production plan coincides perfectly withrend line but appears optimistic. When5 harvest is included iu the trend calculation, average grain productionrcpsillion tons.rojection, of cpurse, assumes normal weather but the frequency of weather-related crop shortfalls in the5uggest that one or perhaps two of the next five yeans will be unfavorable, making fulfillment cf the grain productionlikely.
Hore intensive fertilizer applications are to account for the bulk of this increased grain productionfcontercent. In addition, there is to be some restructuring and expansion of the grain area. Higher- yielding grains such as
rAGE 33
muter wheat, winter rye, spring tarley, and ccrn are to be emphasized. The area under pulses is also tc expand. Land reclamation and the use ot fertilizer on pastures and cthei fodder crops is to increase yields of these crops tc the extent that some of this pastureland can te switched to grain. Double cropping on irrigated land and the expanded use of irrigated land for grain are also to toost production. In addition, improvement of the soil vill support the program.By Soviet account aboutillion tons of grain are foregone each year due to inadequate liming. Moreover, the availabilityhiglier- guality machinery is to improve the timliness of sewing and harvesting operations, allowing the harvest ofillion tons of grain yearly. *
Data on plans for other crops are scanty. Production of cotton is toillior tcts bya plan that will undoubtedly be overfulfilled. output cf sugar beets is to averageoillion tons rcr the five years, consistent with projections basedong-term trend. Plans for other cropsincluding potatoes, an important food and feed crop have not yet been released.
rain ttust be De velopt;d
ernovoye khczyz ygtyox Number, and7
PAGE 34
Output targets for li vested cc ts icio appar ently reduced in the wake ot the distress livestocX slaughtering steaming from last year's poor crop. Average production oi6 millionilk6 millionnd1 billion eggs) are orly slightly abeve the levels achievedven so, the reduced flans are amtitious. Por example,5 setback in the livestock prcgrao probably will net allow meat prpduction6 to exceedillion tons. Fulfillment of the plan would thentaggeringercent average acnual ircrcase in neat output during the remainder of the Five-Year Plan period. If grain production falters, the Soviets will be forced to rely on continuing substantial imports cf grain to meet the plan for livestock products.
Agriculture will maintain its priority aaong resource claimants during the ntixt five years. As shewn below, norc than one-fourth of new fixed investment inill go to agriculture, as it did during the past twe plan periods*
SAGE 35
Agriculture's Share or New Fixed Investment (percent)
0
laD
growth in the amount of tunds channeled to agriculture will be cut substantially, however. Investment is to grow at an average annual rate cfharp reduction fromercent recorded. The slowdown seems to beeflectioneneral tightening of investment funds throughout the economy rathereaction to either the good or tad harvest of the past five years. Investaent in sectors ether thao agriculture is scheduled tc grew at a yearly rata of
hole, investment [lacsre somewhat pOSSling. Deliveries of mineral fertilizer will continue to grow at high average annual rates and tho area limed will
yearly.
and drained cropland, however, will he somewhat below toe 5 level. Grcvtb ic deliveries tractors.
PACE 3c
trucks, and agricultural nachiuery will slow appreciatly. These plana are consistent with the overall design fcr tne economy, that is an increase in prcductiviis to be the prime source of growth. Considering the planned increases in output, however, the investment strategy wouldo stress efficiency and productivity gains not warranted by agriculture's record.
Fertilizer deliveries are tbe only inputs scheduledto increase at past rates. Deliveriesare to grow at an average annual rate ofpercent, compared with theercent yearlyand achieved.illionfertilizer, including five million tens ofwill be sent to the farms, three-fifths moreamount delivered last year, increased applicationis to account for over one-half of thein grain prod uction. until recently,pplica tion schedules have favored technical cropsApplications to grain arehe amount of fertilizer applied tc grain wasthe levelpplications tc grain areanotherercent0 and are tc be those eas with adequate as the
Non-Black Soil 2on** where response rates are the
7
greatest.
nuch of the fertilizer catBar*ed tor agricultureill not be available until late in the period. The capacity to produceillion tons0 dolivery won't be available8iven the deliveries planed6s well as the total amount scheduled for delivery, it appears that deliveriesow byercent yearly8 and then shoot upward5. If this schedule holds, alnost half cf fertilizer deliveted to agricultureill be received during the last two years. The affect on grain yields will therefore notteady. Moreover, planuod applications to grain will be diificult to neet unless losses in transportation and storagecurrently soae IC toercentare reduced.
Efforts to inprove th* quality of cropland will also be continued. The area liaed ia tccillion hectares yearly, againstillion hectares averaged. Application of line willey ingredient in the prog ran to raise productivity in areas such as the Kon-BlacK -Soil 'Zone ol .European bussia. Alt rough the average gross addition to irrigated and drained land will be saaller, this slowdown cculd be counterededaction in the area ol iaptcved land "retired" each year.
PAGfc 36
Scheduled shipments ci tractcis, trucks, and agricultural machinery, will also grow at sharply reduced rates. Deliveries of tractors are scheduled to grow afcout one percent yearly, while the average yearly numirer of trucks received will approximatevel. Agricultural machinery delivered will increaseercent yearly, but this is only one-half the rate. Delive ry ofajor component of agricultural machinery, arc to grow at an average annual rate ofercent, fcllowirg belo*-plan performance.
The slowdown in the delivery of equipment, especially tractors, in part reflects the fact that the industry is approaching its output capacity. In crder to increase substantially the deliveries cf agriculturalomplex changeoverecond shift cr addition cf new production capacity would be requited. Gi venn construction and commissioning cf new capacityas well as Lhe competition fron similar projects such as the Kama truck plant and the Baikal-Amur mainline railroad for tunds tc huy capital equipmentbuilding would have had to start years ago in order to bring this capacity or. lineo prog ram was started.
As in the case of ether inputs, the ilowdcwi: in
PAGE 39
machinery deliveries may veil fce offset by ether factors. The retirement rate foe tractors dropped sharplyover retirement rates would allowexpansion of parks despite the slower growth in deliveries. Also the trend to larger tractors with greater horsepower and the recent introduction of new combine models will allow parks to be qualitatively improved. improvement in the mix of associated farm eg uipnent, wculd further increase the productive capacity of existing [arks, but the failure to produce complementary agricultural machinery for higher horsepower tractors has been one of the constant complaints of the 1ast
The regi me may decide tc fake scae short-run adjustments in its investment strategy. Some republic leaders have questioned the planned pattern of investment for farms, specifically the wisdom of continuing to tuilo large-scale livestock complexes without first ensuring an adequate teed base. lu addition, some middlc-lcvcl planners, who5 wrote bullish articles about fam achievements during the past decade, new ttress agricultural need for help from other sectors. The adjustments that could be cade during the neatytars, however, are tew. Currently planned investment is largely designed to save labor. transfer or resources, tor
PAGE UQ
ow construction of automated livestock Leeders to production of traditional agriculturalould enphasize increased output, tut as discussed earlier, tne agr icultural machinery industry is facing capacity limitations. The alternatives may therefore le reduced tcn of the private sector and taking pains that the planned gains from improvements in the Non-Elack Soile realized.
Sector
By encouraging agriculture's private sector, the regime could boost the availability of selected food products without directly investing in theirout one-guarter of total agricultural out put, including one-fifth of the cropsta tecs, fruits, and vegetablesas well as cue-third of the livestock products, cones from private producers. Snch high-quality products are in especially short supply this year*
Although the state does not invest directly in the priva to sec tor, pri va te activity does have some cost. Private agricultural production is almost exclusively made up of small holdings of land, up tc one-ha If hec ta refrequently combined with one cr two head at livestocknail flocX of poultry- Private tamers alsc have access to additional areas tor pasturing of livestock and resources
PAGE <J1
includingoung livestock, teed and other materialsre siphoned, legally or illegally, from the farms tc the private plots.
The long-run policy tavard this sector has teen constrictive, but restrictions have been temporarily relaxed after bad harvests. In the past, output in tbe private sector has been easily spurred by supplying more livestock and feed to individuals, reducing taxes, lowering barriers to tbe use of public lands, and allotting some urban residents to own livestockIbe current leadership is familiar with this process; when faru production stagnatedhe Brezhnev regine immediately turned to tbe private sector. Private livestock holdings roseercent in that year, andotal acreage and livestock holdings in the private sector wereercent andercent, respectively,U levels, while outputercent.
The regime is already encouraging agriculture's private sector to produce more. Althcughs nc reference to private agriculture in the speeches given at the Twenty-Fifth Partyhe draft directions of the five-year plan noted that farms are "tc renderel necessary assistance in conducting
PAGE M2
private subsidiaryI) At leastdvocate has yone further and discussed tho need to toth coordinate produc tion in the private and public sectors and to introduce modern equipment and technology into the private
*
Increased attention ls being devoted to development of the Kon-Black Soil Zone of the Russian republic. This attention may be veil founded. Success in developing this area will further efforts not cnly tc raise production but also to stabilize farm output. To this end the USSR plans to invest heavily in land melioration, delivery of fertilizer, farm equipment, and construction of the rural infra structure during the next five-years ,
The non- black soil zone is already an important producer of agricultural products and was targeted fcr sane attention in Brezhnev's programsb0 (see Table
C> iiarch page t.
The Private Subsidiary tar&phere of Public Interest Underzyestiga akadergjieriya ekonomicheskaya, Numberndage 2.
* The Hon-Dlack Soil Zone of the Russian Republic includesblasts, an area or aboutillion hectares.5 this zone producedercent of the USSR's grain,ercent of its potatoes,percent of its vegetables,ercent of its meat, andercent of its milk-
PAGE
his zone includes large tracts ct noggy, ureven, and stony land vith soils low in natural fertility. .federate amounts of money were spent, mainly tor draining, clearing, leveling, liming, and fertilising. Although thereelatively short growing season, the zone has the highest average annual rainfall of any large agricultural area in the European USSR.
Although some resources were earmarked fcr this area in the past, the zone will receive an increased share of all types of inputs. Gross fixed investment is to totalillion rubles withillion rubles used to develop other branches that are closely connected with agriculture. Fertilizer deliveries during the period will be double the amount used inotalillion tons. Delivery of all types ot eguipserit will grew faster in this area than in the rest cf the ccuBtry.illion hectaresdrained lane will he ;ut into operation.esult, grain production is scheduled to increase8 million tons5 toillion tonsther crops are to respond likewise -ii.il production cf livestock productsincluding large-scale livestcck cczpltxess to increase.
How well the USSR's eccnemy ferrcros during the cccrso
lAbLt 1C
DSSH: INVESTMENT IN THE KGa-illaCK ECU (WtiSZ) CF THs hSrSf
,
grossagric ulturc:
Billion 5 C
Percent
Deliveries of; Tractor*
Thousand
Percent 3
Thousand
Percent 4
coabines
Thousand
7
Percent1CC.C
Million
Percent
&^
of the Tenth Five-fear Plan defends ir large fart cn the pattern and severity of weather-induced fluctuations in crop production, particularly grain. If average weather prevails ovor the next five years, most of the agricultural goals are in reach. Should the Soviets suffer another harvest disaster, its effect would depend on timing.
If weather conditions are beneficial during6 growing season, the Soviets cculd harvest acre grain than their minimum domestic requirements, estimated atillionnder these conditions, the USSF could increase the weight of animals being marketed, begin the slow process of rebuilding livestock herds, and start to replenish carry-over grain stocks. If the harvest merely net nininun needs, expansion of herds would te postponed or depend on imported grain.
Anotherillion tonsin
o we va r, woulddredooa the goals of the five-yearailure at this time would force further large reductions in livestcck numbers
* Under normal conditions, grain reguireients tor food, industrial raw materials, seed, exports, and livestock fued wouldoi11ion tons yearly. Eecaus* livestock feed accounts for roughly one-hall of this requirement, tho sharp reduction ir herd size following5 crop disa ster has lowered tbe minimum grain roquirome nt.
PACE 4fc
and additional massive imports of grain from hara-currency areas, worsening the large trade deficit anticipated inn turn, this might force the OSSR to taketbacks in non-agricultu rai iijor is. The Soviet consumer would face arether reduction in meat supplies, more than erasing the gains made under Bre2hnev.
On the other hand, gocd crefs67 might well be enough to generate suffficient momentum tohortfall la te in the plan period.
AESEAEIX
G Si.T AGEICUITUM1 ItClUCTICK
the measure ot agricultural (reduction used in this paper is ao approximation of the value of lain output available for sale or note consoaption. It is based on the physical output ofcrops anc anisal products weighted by average prices rccoived by all producers (collective and state farms, other state agricultural enteritises, and individual producers)0 fcr output sold through state procurement channels aod the collective farm market and coaaissioo trade. This value of agricultural output is then adjusted for changes in inventories ot ourf livestock and deductions are made to account for theses of farm productB such as feec and sood; tnat is, deductions are made tor the amounts of groin, potatoes, sugar beets, and milk fed tc livestcck, fcr thu quantity of eggs used for hatcbirg, ard fcr the amcunt; of grain and potatoes used as seed.
Ad indox of the value of net agricultural output0S is given in Appendixnd ttoken into indexes for crop and livestock production ic Appendix Tauleutput ol commodities itcluded in the calculation,
* AGE Ud
sinus seed but including the pettier tea tc livestock, is shown in Appendix Tablend tht value ci net agricultural production, as defined above, is derived in Appendix lotl* U
The physical commodities and livestock inventory scries are for the most part official production statistics. Data for grain and sunflover seed production have been discounted to reflect waste and losses ir handling. Procurement data arc used for sugar beets. Estimate* of output cf individual types of vegetables are derived by using the relative starts ot each type or vegetable in government purchases. Additional adjustments are sade to so so sinor crops to compensate for the lack of data.
Estimates of the amount cf grair and potatoes used as livestock feed arc based on the availability cf these crops after deduct ions for other uses [industrial tse, food, net exports, and change inhe quantity or sugar tetts fed to lit?stock is assumed to be tbe difference tctwten production ind procurement, in estimating the appropriate deduction from the gross value cf livestock fcr the value of grain and sugar beets fed, it is assunud that one-third of the product used nu teediven crcp is fed during the calendar year in which it was [reduced and that two-thirds ir# fed during the following calendar year. EStismtU o(
PhCf us
milk fed to livestock and amounts of grain and potatoes used as seed are basod on official sources.
ore comprehensive explanation of the fcthcdclogy used in constructing this measure ct net agricultural production see Eouglasiancnd, "Trends in Output, inputs, and Factor Productivity in Soviet. Congress, Joint Economic Committee, Hew Directionsthe Soviet Economy Part^II-g^ CS, Government Bricting Office,nd DouglasEiamond and Constance B. Krueger, "Recent Developments in Output and Productivity in Soviet. Congress, Jcint Economic Committee, Soviet Econoaicfor_the. Government Printing Office,CS73.
page 50
TABLE 1
Index of the Value
Net
Production,
Annual Rate of Growth
page 51
APPENDIX TABLE 2
USSR: Indexes of Agricultural)
Net Crops
2
6
9
of food and technical crops less seed butthe portion fed to livestock.
of output to meat, milk, eggs, wool, andproducts less livestock feed and adjustedin herd inventories.
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Original document.
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