CURRENT SUPPORT BRIEF
DECLINE IN SOVIET MEAT SUPPLIES INDICATED BY DATA ON MEAT SALES, PRICES, AND PRODUCTION
office of research and reports
CENTRAL INTELLIGENCE AGENCY
This report represents the Immediole views of the originating intelligence components of the Office of Research and Reports. 'Comments are solicitbd.
DECLINE IN SOVIET MEAT SUPPLIES INDICATED BYND PflODTJcTroli
State meat production and retail sales of meat products in Soviet state stores0 lncreasod sharply over9 levels. For the largo part these increases were concentrated in tho first three quarters0 and production and sales infourth quarter0 were only slightly above those in theperiod Total meat production0 was about two percent below9 record high, with all of tho decline occuring in the private sector. State production of meat in the1 is reported to have declined byercent in comparison with production in tho corresponding period This implies that supplies of meat products in state stores in the first quartor1 probably fell below such supplies in tbe first quarter At this time feed supplies are greater than last year, and there ls no reason to think that total meat production will decline
The rise of disposable Incomes of consumersthose of lower income groups, together with the apparent failure of meat supplies in state stores and on the collectivetoignificant increase, apparently has generatedpressures which have resulted in rising neat prices in collective farm markets. Meat prices in Moscow collective farmshowed substantial increases over the previous year during the second and fourth quartors
Indexes of Quarterly Beef, Veal, and Pork Prlces in Moscow* Collective Farm/
Moscow prices are only an imperfect indicator of the trend of collective farm market prices in other cities.
The indexes were constructed by wolghtlng by annual quantities of boef, veal, and pork sold In the colloctivo farm marketsities/
These Increases in colloctivo farm market moat prices, which were particularly sharp during the fourth quarter, appear to reflect both tho failure of state production of meat to expand in the0ecline in private meat production during the year. No collective farm market prices are available yet for theut reportod incroases of queues for meat in state stores also mayecline in state store supplies of meat during the first quarter1 in comparison with tho previous year. 3/
Effect on tho Consumer
The Implied decline in moat supplies during0 and1 will reduce moat consumption and raise the cost of living of the average Soviet citizen but probably will nototiceable effect on his total food consumption in terms of calories. By retarding the growth of the proportion of calories obtained from animal products, however, reduced moat consumption will slow the rate of Improvement in the diet. Such an improvement can be expected normally in the USSR through increased purchases by consumers of higher priced foods such as meat as disposable incomes, particularly among lower income groups, increase. Inecline in moat supplies should mako clear to tho Soviet citizen how remote tho prospects are for achievement of Khrushchev's goal of overtaking the US in consumption of meat products per capita.
Retail sales of meat products ln state stores for the full03 percent increase over sales Most of this increase, howover, waa attained in the first three quarters of the year when sales Increased almostercent over theperiod Sales in the fourth quarter wereercent above those in the fourth quarter
Retail Sales of Moat andew Prices)
In comparing increases in retail sales of meat with increases in production, it should be noted that the increase in sales measured
in value will ovorstate the Increase in sales measured fn tons. This overstatement arises because the measurement in values gives greater weight to high cost products which are increasing lnto total sales.
Because no changes in meat prices were announced9t is assumed that Increases in meat 'sales in current prices are equivalent to lncroases in meat sales in constant prices.
The failure of fourth quarter rotail sales of meat products toignificant increase over sales in the corresponding period of
ppears to be tho result of the declining state production of meat products. Althoughive percent increase for the full0tate neat production declined in the fourth quarter in relation to production in the corresponding period9
State Production of Moat Products90
The decline in private production of moat0 is Impliedomparison of total production of meat which includes collective farm and private production, with state production of meat. Whereas state production increased, total meat production declined during
State neat production in the first quarter1 amounted to onlyercent of production in the corresponding periodecause moat inventories are kept at low levels because of the lack"*of refrigerated storage facilities, and because such inventories as were maintained appear to have been drawn down sharplyhis decline in production of meat can be expected to be translated immediately into lowered moat supplies in state
At least part of the decline ln state meat production in the first quarter1 is due to the abnormally high state meat production in the first quarter0 (which Increasedercent over theporiodnd therefore doos not necessarily indicate that state production during tho full1 will fall
Sovetskaya torgovllya,6. U.
Sales of veal were estimated by taking one third of totalof beef and veal.
USSR. Narodnoye. U.
USSR. Vestnlk statistiki,.
Calculated aa the difference between total sales and sales
in the first throe quarters.
by multiplying9 saleshe
ratio of0 sales to9 sales. The ratio is from USSR, Vestnlk statlstlkl, no..
USSR. Vestnlk statlatlkl, no..
Calculated as the difference botween total sales and sales
in the first three quarters.
USSR.0 godu,^ U.
Calculated by dividing output In the first three quarters
0ho ratio, of output In the first three quartors0 to that In theuartersravda, .. /
as difference between total output and output
In the first threo quarters-;'
USSR.0 godu,. U. .
Calculated as the difference between total output and out-
put in tho first throe quarters.
USSR.0 godu,. U.
USSR. Vestnlk stayistlkl, no..