Point of View

"Poultry breeding has been developing fast in the past few years. It posted a 12% growth in 2009, and now we can satisfy over 75% of the demand. But we still have to import nearly 25%, which is too much. However, I want to say again that we are working hard to replace imports. I hope that government support has contributed to this trend; we have allocated long-term investment loans for the construction of farms and subsidised interest on loans".

"You know that the new law on trade has come into force, stipulating strict deadlines for payments to the suppliers of agricultural products. We have set the strictest deadline for perishables, 10 days, I think. I hope this measure will have a positive effect, and will help to strengthen the financial situation of agricultural enterprises".

"At the same time, we are working not only in the economy but also in the legal sphere. Agricultural producers and companies that process agricultural raw materials want to settle their relations with retail chains. As you know, a relevant law is being considered in the State Duma. This law covers issues of great importance to farmers. One of them concerns payment for delivered products. If the lifetime of bread is 72 hours and is even shorter for milk, money for them should be transferred to the producers without delay or else they will have no working capital, no money to produce these products or for their economic operation. But the money was delayed for a month and even longer. As of now, payment for perishables is to be transferred within ten days, for other products within 30 days, and for spirits within 45 days, but we will reconsider this."

"Agriculture, which some in the previous years called "the black hole" of the economy and so on, is a growth area today. It will grow by 0.5% this year, and in some areas, for example, in livestock, it will grow by 10%. It should have been still greater, but that is how it looks on paper: Last year we had a record grain crop of 108 million metric tons. This year it will be large too, at 93 million tons, but because it is less than last year, on paper the indicators have gone down. But on the whole, I repeat, agriculture will grow by 0.5%."

“We have big support programmes for agriculture, such as tax breaks and subsidies. Last year we issued large subsidies, which covered 60% of spending. Early this year we increased them to 80%, and in livestock breeding to 100%, at the request of farmers and in view of problems due to the economic downturn. In general, I would like to tell all those present here, including farmers, that in 2009 we have issued 700 billion roubles ($24.1 billion) of loans to agriculture through different channels. This is more than ever before, but then, agriculture has never reported such good results before either. We will continue to implement these programmes.”

"The 2012 APEC forum is also a good opportunity to concentrate our resources, solve the many problems of our largest metropolis in the Far East and make the city's residents' lives more comfortable. We can position Vladivostok as Russia's "gateway to the Pacific" and a promising venue for international cooperation."

"The fulfilment of all these plans will enable us to hold an important event - the 2012 APEC forum. This upcoming summit is a significant political and economic event for the entire Asia-Pacific region. Certainly, a successful event will enable Russia to enhance its international standing and will help in making additional contacts with our partners in the region."

"Seasonal changes in production volumes and the balance of purchasing prices are important elements of the dairy market. This problem could be solved through regular purchasing and trade interventions. We plan to approve a Government resolution on this issue today. The state will buy surplus products to prevent a plunge of milk purchasing prices. On the other hand, the sale of previously purchased products will prevent unjustified hikes of retail prices."

“Farmers are anxious to know what will happen to their relationships with credit institutions, with banks. We have already made a decision on this matter that would extend short-term one-year loans by 6 months. We have discussed it. I think it can be extended from 6 to 9 months. It will enable the enterprises to complete the following year, to sell their crop and earn the money that they can use to pay back the loans.”

“Droughts and other emergencies occur practically every year. The current situation is not an exception. We have been developing mechanisms of protecting farmers against such risks. I am referring above all to insuring crops. Federal and regional budgets allocate sizeable amounts to develop it every year. In 2009 the federal budget will allocate 2 billion roubles. Already 970.9 million roubles, almost one billion, are in the accounts of regions. Moreover, new rules for compensating the cost of crop insurance came into force in 2009. The federal budget reimburses to farmers 50% of their insurance premium.”

“As I have already said today, the general performance of the Russian agricultural sector has been high and even shows a better ability to withstand the global economic crisis than some of the other sectors. Support of agriculture is undoubtedly one of our priorities. The funding of that sector has increased significantly in recent years. We have substantially increased the capital of Rosselkhozbank and Rosagroleasing. The decision to raise to 80% the level of subsidies for part of the cost of interest on loans, including loans taken out to buy fuel and fertiliser, went a long way to help agriculture.”

“Of July 1 fuel and lubricants will be sold to farmers at a 10% discount on the wholesale price. I ask the Ministry of Energy to report on how that agreement is being fulfilled and how the declared quotas of fuel and lubricants are being used.”

“The Government is doing a lot of work to regulate the grain market in order to stimulate production. The mechanism of grain intervention is being used actively. In all, 8 million tons of the 2008 harvest have been procured at the cost of 38.6 billion roubles. That has kept prices at an economically valid level and prevented a fall in farmers' incomes.”

“The gross yield of grain is expected to be around 85 million tons, which will more than cover our domestic needs and will enable us to continue grain exports. The export potential of around 20 million tons will remain through the current and the next years. The Agriculture Ministry says its will be even bigger, 22 to 23 million tons.”

"We must develop our own agriculture. This is why we are now investing most money, even in these crisis conditions, in farming, of all sectors of the economy. To begin with, we subsidise up to 80% of the interest rate for farms to implement their investment plans, which are very large-scale. We now see large firms and big livestock breeding centres springing up. There is nothing in Europe to compare with them: they are larger, more modern, well-equipped and computerised throughout. And we seek to help the farms realise all these plans."

“It is necessary to regulate the grain market. For that, the Agriculture Ministry should greatly increase the effect of purchasing interventions. With that end in view, we have agreed to increase the authorised capital of Rosselkhozbank once again-by 45 billion roubles this time, after this year's recent 35 billion roubles. The money will expand grain purchasing interventions and so help farmers with sales and improve their financial standing.”

“We need to retain the volume and terms of agricultural crediting. As I have said, this will promote cattle breeding, dairy production and other essential projects, and guarantee spring sowing. Agriculture needs roughly 400 billion roubles worth of loans-half of them short-term, and the other half long-term, up to 850 billion grand total. It will take 72.3 billion roubles to finish livestock unit construction. That, too, demands Government support.”

“We have determined to subsidise agricultural loans, or farm production will drop. The matter came under detailed discussion yesterday, too. As you know, subsidies presently cover two thirds of interest. The Central Bank has increased its refinancing rate, so commercial bankers are also sending rates up. The entire national economy is under that burden, and it should be distributed between all branches more or less evenly. Still, we should make agriculture an exception, as in previous years, to ease pressure on it. We have agreed to subsidise 80% of agricultural credit refinancing.”

“The decision on new poultry, meat and pork quotas mentioned today has been signed. Our talks with foreign suppliers took six months and were very difficult. We have come to an agreement at last. Extra-quota meat import tariffs will rise substantially, while poultry meat quotas will be reduced by 300,000 tonnes, etc. The figure corresponds with annual Russian production increase. That is what we will focus on. We must guarantee that increase-it is crucial.”

“New farm leasing terms are entering into force. They have been extended from 10 to 15 years, and advance payments of up to 7% of leased equipment cost have been abolished. Now, the first instalment should be made 12 months after equipment is received.”

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