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President of Russia Vladimir Putin: Good afternoon.

Mr Patrushev, how did the agricultural sector perform over the past year? I am well aware that there were some adjustments in the growth rate. How can you explain this and what do you think about these trends? What are the prospects and plans for the industry?

Minister of Agriculture Dmitry Patrushev: Thank you very much, Mr President.

Let me begin by saying a few words about the overall development trends for the agricultural sector. Last year, agricultural output increased by 2.5 percent. This was attributable to a number of factors, including a substantial crop yield.

As for this year, I do hope that we will see an increase in agricultural output. In fact, there was an upward trend between January and August, followed by a slight decline in August and September. In August, production dropped 11 percent, with another drop of 6 percent in September. However, as I have already pointed out, we will see an increase of 1 percent for the whole year. It will not be like last year’s but there will still be growth. I hope that the positive momentum spills over into 2019.

Mr President, I would also like to share some facts and figures with you regarding the main indicators for the agro-industrial complex. Crops and pulses have been threshed across all farmed land. Despite the unfavourable weather, the crop yields were quite good at 110 million tonnes in net weight, up 11 percent compared to the average annual yield over the past five years.

By the end of 2018, we also expect to harvest 18 million tonnes of oilseed, up 1.5 million tonnes from a year earlier. The beet harvest is almost completed and exceeds 41 million tonnes, along with 6.7 million tonnes of potatoes, 4.2 million tonnes of open ground vegetables and almost 1 million tonnes of greenhouse vegetables. On top of this, we have harvested over a million tonnes of fruit and berries.

Mr President, with this crop harvest, we will be able to meet not only the domestic demand but also be able to export the planned amounts. According to our estimates, the export potential for grain will be 39 million tonnes, including 34 million tonnes of wheat. I will cite one more figure: agricultural exports, as we expect, will total about $26 billion by the end of this year.

Vladimir Putin: That’s good news.

Dmitry Patrushev: Mr President, I can briefly report on the sowing of winter crops. Planting has been completed on an area of more than 17.5 million hectares – last year’s figure was half a million hectares less. We expect the winter crops to come through, and hope that we there will be enough snow to cover them as well as favourable weather conditions.

I would like to specifically report that we are paying a lot of attention to important essential staple food products and regularly monitor the prices of these goods. We also track the price of bread and bakery products on a weekly basis.

Wholesale prices of bread made from rye-flour and a mixture of rye and wheat flour are at the 2017 level. Wholesale milk prices can also be compared with the previous year.

At the same time, there was a deviation in wholesale sugar prices. In fact, the wholesale prices are higher compared to last year, but taking into consideration that we produce 6 million tonnes of sugar, while domestic consumption stands at 5.8 million tonnes, we do not anticipate any complications. According to our estimates, the price of white sugar will be subject to adjustment. Let me point out that the Federal Anti-Monopoly Service has launched an enquiry into sugar pricing.

Mr President, there is another thing I would like to bring to your attention. As I have already said, we are allocating funds to the regions in a consistent and regular manner. Some 121 billion roubles have been reserved for constituent entities of the Russian Federation, and about 80 percent of this amount was actually transferred to agricultural producers. This indicator is expected to reach 100 percent by the end of the year.

Let me also point out that the mechanism of a single subsidy as it stands right now can be improved. For this reason, the Agriculture Ministry will work on enhancing the efficiency of government support measures.

In particular, the ministry is currently working on developing specific support measures for every region. As part of this effort the Ministry intends to carry out preliminary reviews and develop agricultural development initiatives for every specific region of the Russian Federation, including food production and processing. Not only are we going to take into consideration the specific nature of every region, retrospective data and forecasts, but also the development of neighbouring regions and of the Russian economy as a whole.

This analysis will lay the foundation for a mechanism of tailored support measures for specific segments on the regional and national levels. We believe that by doing so we will help the agricultural industry achieve maximum efficiency and boost exports.

Vladimir Putin: That’s good.

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