The successes of farmers make it possible not to increase the volume of state support for the agricultural sector

The head of the Ministry of Agriculture, Dmitry Patrushev, reported to the State Duma on Wednesday on the results of the implementation of the state program for the development of agriculture. In fact, however, his report was devoted to the current generally favorable situation in the agro-industrial complex and the future plans of the ministry. The priorities outlined by the minister no longer imply stimulating the rapid growth of the sector, but a transition to its systemic support. This also explains the fact that the amounts allocated by the budget for agriculture in 2024 compared to 2023 will increase insignificantly – the ministry intends to concentrate on increasing the effectiveness of existing support measures, and not on increasing its volumes.

Minister Dmitry Patrushev, speaking in the State Duma, began the national report on the implementation of the state program for agricultural development with a report on successes. In 2022, the agricultural production index amounted to 110.2% of the 2021 indicator and 109.8% of the 2020 baseline indicator for the state program. The import substitution index (the ratio of the growth rate of agricultural production to the rate of increase in its imports) also increased above the planned levels – it amounted to 116.9% compared to the 2021 level.

Turning to plans for the future, the minister said that within the framework of the state agricultural development program alone, 370 billion rubles have been allocated to support farmers this year. Let us recall that the main instrument for supporting the agro-industrial complex remains preferential lending, which was suspended after the Central Bank raised the key rate (see Kommersant on September 7). Dmitry Patrushev, who previously promised that accepting applications for programs would resume by the end of the year, now, given the demand for this measure, announced its unfreezing at the end of September. The resumption of another popular program – rural mortgages – is also possible this year, but the volume of funds issued, according to the minister, will be reduced.

As Mr. Patrushev reported, Russian farmers have already harvested more than 123 million tons of grain, exceeding the target mark. New expectations of the Ministry of Agriculture: 130 million tons of grain harvest and 60 million tons of grain exports. “At the moment, we have supplied $31.3 billion worth of products to foreign markets. And we expect that by the end of the year Russia will maintain its status as a net food exporter,” emphasized Dmitry Patrushev.

The plans announced by the minister for the near future confirm the transition from stimulating the sector to its systemic support. In particular, the ministry is going to deploy additional measures to strengthen the scientific base of the agro-industrial complex, develop breeding and genetics, and create agrobiotechnoparks. The minister also clarified plans for the implementation of the state program “Land”: the Ministry of Agriculture expects that after two years of its operation it will be possible to bring into circulation 780 thousand hectares of currently unused agricultural land.

The deputies had virtually no questions on the topic of the meeting—the implementation of the state program. Among the systemic problems, they were mainly concerned about the situation in the fertilizer market and the low awareness of small and medium-sized businesses about government support measures; among the “opportunistic” ones, the increase in fuel prices affecting the work of agricultural producers.

The parliamentarians were surprised by the statement by the head of the Ministry of Agriculture that the volume of state support for agriculture in 2024 will amount to about 500 billion rubles. (in 2023 – 480 billion rubles). Chairman of the State Duma Committee on the Financial Market Anatoly Aksakov suggested that if such a budget is maintained, there will be no development of the sector next year. In response, Dmitry Patrushev recalled that additional funds are traditionally allocated for the implementation of support programs throughout the year. Apparently, the preservation of volumes of state support comparable to 2023 is also explained by the fact that, against the backdrop of successes in the industry, the ministry will reorient it from extensive to intensive growth – working on the accuracy and efficiency of assistance, and not on its volumes.

Kristina Borovikova