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Visit to National Grain Centre in Krasnodar

March 12, 2018, Krasnodar

Vladimir Putin toured the Lukyanenko National Grain Centre during his working trip to the Krasnodar Territory.

The President examined information stands, learned about the centre’s selection achievements and visited the phytotron facility (research greenhouse). Then he met with workers of the National Grain Centre and answered their questions.

Employees of the institute named after Soviet plant breeder Pavel Lukyanenko are engaged in research and development of cereal breeding, resource-saving farming systems, natural soil fertility restoration and plant protection. The centre currently employs some 600 people and pays special attention to supporting young professionals.

* * *

President of Russia Vladimir Putin: Good afternoon, how is your work going?

Viktor Dyachenko: Everything is good. My name is Viktor Dyachenko. I represent a company from the Rostov Region. We are dealers at the National Grain Centre in the Rostov Region. We grow about 14 to 15 varieties every year and sell about 60 percent in the Rostov Region. A small portion, about 35 to 40 percent …

Vladimir Putin: Crop breeders are not just local, but come from all over Russia?

Viktor Dyachenko: Yes.

Vladimir Putin: I see.

Viktor Dyachenko: …35 to 40 percent goes to the Central Black Earth region and as far as western Siberia and the Volga Region.

Modern intensive Krasnodar grain varieties have allowed our company to increase its yields. Our average yield is about 8,000 kilos per hectare, which is a very good result.

Vladimir Putin: It is, indeed.

Viktor Dyachenko: I also want to say that we are interested in receiving feedback about our seeds. It is very nice when people call us back and thank us.

Even in the Central Black Earth Region, the most recent Krasnodar varieties are not just heat-resistant, consume moisture very sparingly and have very high yields, but they also show excellent results as compared with Western varieties, exceeding Canadian, German, and French wheat varieties.

In the Kursk Region, Artel, operated by the Antipov Brothers, plants 40 to 50 varieties developed by the world's leading breeding schools each year on a competitive basis. They noted that the Krasnodar varieties provide the most reliable high yields.

At our small farm, we conduct a Day of Field with the breeders from the institute each year. It is attended by representatives from large agricultural holdings and small farms alike.

About 250 people attend this event annually. Agronomists and senior executives can take a look at the real crops and the cultivation of new varieties, new cultivation technologies, and see firsthand the potential of these plants and the yield of the Krasnodar varieties.

Mr President, in my opinion, we have seen a major increase in wheat yield in our country in recent years. I think that the expansion of the areas under the Krasnodar varieties is one of the factors behind this increase. There is a direct link.

Vladimir Putin: Yes, I believe there is.

Yevgeny Komanov: Good afternoon, Mr President.

I am a farmer from Korenovsk region of Krasnodar Territory.

I have always thought that the goal of agricultural development should be to increase the yield of crops, primarily winter wheat. Today we have quite a few questions…

Vladimir Putin: Is wheat your specialty?

Yevgeny Komanov: Yes, it is. I have also enrolled at postgraduate courses.

Director of the Lukyanenko National Grain Centre Alexander Romanenko: He is our postgraduate student.

Yevgeny Komanov: Yes, I am. I am studying in order to expand my knowledge and to be able to introduce modern science-based technology into agriculture, because now we do not grow just one wheat variety but a range of different kinds. I have decided to improve my knowledge and that of our other specialists too, which is why I have enrolled at postgraduate courses.

My research adviser and I have chosen an ambitious subject, Growing the Largest Possible Harvest of Modern Winter Wheat Varieties of the Kuban Line. Much has been done towards this end, but there is still plenty more that can be done. However, we have already increased the yield of some varieties of wheat to 100 centners [10 tonnes] or more.

Vladimir Putin: How much?

Yevgeny Komanov: Yes, 100 centners. We have achieved this result on a commercial plot of land of over 100 hectares. I firmly believe that this is the combined effect of cooperation between researchers and producers, which allows us to test new varieties promptly and properly for subsequent commercial use.

Vladimir Putin: Is your land located in Krasnodar Territory?

Yevgeny Komanov: Yes, it is in Korenovsk region of Krasnodar Territory.

Vladimir Putin: How much land have you got?

Yevgeny Komanov: I have 1,074 hectares.

Vladimir Putin: And how many people work on this land?

Yevgeny Komanov: We have 20 people. We have decided to take up livestock breeding as well, which is why we are renovating a farm and have hired three security guards. Generally, they are not doing any additional…

Vladimir Putin: What will you produce?

Yevgeny Komanov: We have opted for dairy farming. We have renovated two buildings, where production will begin as soon as we receive the necessary equipment. We have filed an application for the Agriculture Ministry’s programme of family livestock breeding farms.

Vladimir Putin: How many animals do you plan to have?

Yevgeny Komanov: We plan to have 300 dairy cows.

Vladimir Putin: Not very many.

Yevgeny Komanov: I believe that appetite comes with eating. The main thing is to get started, and everything will be fine. I am sure that we will soon see the result we want.

Vladimir Putin: Will you only produce milk, or will you also make dairy products from it?

Yevgeny Komanov: The immediate goal is to launch our livestock breeding farm. Actually, I am a rather ambitious person, even if this may sound immodest. Yes, I do hope to launch dairy production in the future, but on a small scale.

Vladimir Putin: First of all, in order to launch processing, you need to buy livestock, and not just any kind of livestock, but the one you really need. For example, making cheese requires a specific quality of milk. This means that the stock should be selected accordingly.

Alexander Romanenko: So far he has been supplying milk to Kremlyovsky Kombinat, which makes the best ice cream in Russia.

Vladimir Putin: This is true. I agree that this is the best ice cream.

Alexander Romanenko: You treated our Chinese comrades to this ice cream.

Vladimir Putin: Yes, I did. I also like it. It is very good.

Yevgeny Komanov: We will do our best. I strongly believe that we can reach an output of one hundred centners. There is no doubt that producers will meet this challenge, and we will proceed from there. Agricultural complexes are what really matters, those in crop farming and cattle breeding. What is most important is crop rotation. This is very important.

Vladimir Putin: Unfortunately, there are problems with competition between farms and major producers, and I am aware of them. This includes getting hold of land and accessing financial resources on reasonable terms. We will definitely work to resolve these matters.

I instructed the Prosecutor General’s Office to take this up last year. I am well aware of these problems. We need to be cautious, proceeding from the premise that farmers must find their own market niche.

In fact, they already have a market niche. I cannot quite remember the exact figures, but farmers are already contributing in a meaningful way to overall productivity growth. I believe that they have doubled their output. This goes to say that we will certainly work on these matters.

A decision has been adopted on financial leasing so that land can be provided without any tender. However, there is an astute provision in the law, whereby this is possible only when there are no other contenders. Therefore, this also deserves to be looked into carefully.

We are now working on a mechanism consisting of providing land under four-year leases without any tenders with lease rates not exceeding the rate of the land tax.

So let me assure you that we will come up with additional ideas on ways of supporting farmers, especially considering the amazing results that you have achieved. This is truly great.

I would like to wish you every success!

Yevgeny Komanov: Thank you very much.

Igor Bondarchuk: Mr President, my name is Igor Bondarchuk, and I am a harvester operator at the National Grain Centre.

There are only 10 harvester operators at the centre, and we have specific equipment.

Vladimir Putin: What kind of equipment?

Igor Bondarchuk: Small harvesters.

Vladimir Putin: Special ones?

Igor Bondarchuk: Yes, designed specifically for us.

Alexander Romanenko: Designed for operations on selection breeding plots.

Igor Bondarchuk: Our equipment measures grain humidity, harvested crop size and other characteristics in the process of harvesting. Most of it is imported from Austria and Finland. Of course, we would like to have Russian-made small-size equipment for operations on selection breeding plots.

Vladimir Putin: You know, our agricultural machine-building has made great strides over the past few years. Not just Rostselmash, which is the leading company, but other efficient companies as well. The equipment they produce is as good as foreign-made machinery.

However, we do lack some equipment for operations on selection breeding plots. Our companies produce some of it, but I agree that this is not enough. Therefore, we will boost this sector, and the Agriculture Ministry should…

Actually, we are collecting applications so that the producing companies know that they will be able to sell their goods, because there is investment and return on investment. We will definitely continue working on it.

Fyodor Kuropyatkin: Mr President, I am a farmer in livestock breeding. My name is Fyodor Kuropyatkin. I have been farming for 20 years. My sons have taken after me: they have graduated from Kuban University, where they studied agriculture, and they are working with me now.

Everything that has been said here is true. The farmers deserve praise, because some of the varieties of wheat they are using are world-class. I buy their wheat as well. But my specialty is dairy livestock breeding.

Today I would like to speak not just about achievements, but also about the problems Kuban farmers are facing, and we have some 2 million farmers here. What is the situation? Small farmers are like outlaws, because they cannot gain access to the civilised market. Chain stores are not interested in small batches, and there is nobody else to offer our produce to. The local authorities are aware of this problem and have been trying to solve it through weekend markets and things like that.

Vladimir Putin: You need agricultural cooperatives.

Fyodor Kuropyatkin: You have provided the answer even before I asked the question. We are working on this, but farmers cannot do it on their own. We need serious support.

Vladimir Putin: This support should be provided at the regional level. We are ready to support these efforts from the federal budget by granting subsidies, as, in fact, we do already.

What is the situation? Under the current norms, at least 20 percent of the total allocations provided from the federal budget to the regions to support agriculture should go towards small and medium-sized enterprises. This is the minimum. And we need to pay close attention to these figures.

I do not know how exactly the situation is monitored here in Krasnodar Territory, but I will certainly issue the relevant instructions to the Government and law enforcement agencies, primarily the Prosecutor General’s Office, as well as the Anti-Monopoly Service, so that they keep a close eye on whether this allocation threshold is respected. This is my first point in this regard.

My second point has to do with access to funding. This is another obvious problem.

Fyodor Kuropyatkin: This is true.

Vladimir Putin: There is a special body in Russia tasked with assisting small and medium-sized enterprises. It works in the agricultural sector as well. We are now looking at the possibility of providing loans at an appealing interest rate of below six percent, under guarantees provided by this body instead of collateral. We are working on it, and I think that this mechanism will be launched.

Fyodor Kuropyatkin: Thank you.

There is another problem. For a farmer, land is the main means of production. At the same time, we see that farmers are losing land to agricultural holdings, and are unable to compete against them. Major agricultural holdings easily and invariably win in any disputes regarding land, lease contracts, tenders or court proceedings.

They have bigger financial and administrative leverage. This process accelerated after the farming law was amended to delete articles that protected us. All these changes were to the detriment of farmers.

Vladimir Putin: Can you be more specific?

Fyodor Kuropyatkin: The procedure to get land used to be like this: I had to find a plot of land, the cadastral number, draw the boundary and that was it. All that remained was to submit an application, and if there was no other farmer who wanted to lay claim on the land plot, I got it. If there were two farmers, we had to bargain. But this is no longer the case. Today, a farmer has to face off against an agricultural holding in an auction.

Vladimir Putin: And the agricultural holding gets the land, obviously.

Fyodor Kuropyatkin: There is no way the agricultural holding can lose.

Vladimir Putin: I see.

Fyodor Kuropyatkin: As a result, the farmer loses the land and is ruined, and we have one more destitute person. Who needs this? I am for competition between farmers, because farmers and agricultural holding companies are in two different leagues. The family farmers who lose their land will cease to exist. You know this very well.

Vladimir Putin: Yes, of course I do.

Fyodor Kuropyatkin: I think it was meant to be a good idea that the laws were amended.

Vladimir Putin: We have only one good intention, which is to ensure the growth of commodity production, and this is it. This is not the solution. Frankly, I do not even remember this decision.

Fyodor Kuropyatkin: I understand that you cannot…

Vladimir Putin: This may be so, but they definitely amended the laws to help the people, thinking that they should help large producers because they turn out the bulk of products.

Fyodor Kuropyatkin: I can understand this.

Vladimir Putin: I agree that we do not want people to become ruined and move to big cities. We must preserve this kind of people, who can, want to, and will be engaged in farming from one generation to another. So, let us review this and see what can be done to improve the situation.

I have mentioned one of the possibilities: renting land for at least four years, which will not cost much more than the land tax. Anyway, we will look into this issue, and we will discuss what you have said. I will not forget this.

Fyodor Kuropyatkin: Thank you.

You have actually answered my question before I started asking it. All farmers wanted to hear your answer. What is our future in Russia?

Vladimir Putin: I do not know how important it can be for large producers to give farmers an opportunity to…

Fyodor Kuropyatkin: They will even fight for small plots of 5 hectares. We have seen this happen.

Vladimir Putin: I need to look into this situation. I understand and share your concerns. For now, I can tell you that I am definitely with you on this one. We will see what can be done.

Fyodor Kuropyatkin: Thank you very much.

Vladimir Putin: It is the least I can do.

Fyodor Kuropyatkin: You have the farmers’ support.

Remark: Mr President, thank you for listening to us. Can we take a picture with you, please?

Vladimir Putin: Yes, certainly.


March 12, 2018, Krasnodar