"For us, the domestic market is a basic priority"
Russia provides itself with basic foodstuffs, and in a number of key positions — from grain to vegetable oils — it significantly exceeds the indicators of the Food Security Doctrine. Oksana Lut, Minister of Agriculture, told Izvestia about this in an exclusive interview following the St. Petersburg International Economic Forum. According to her, Russian exports continue to adapt to geopolitical changes: even after the restructuring of logistics amid the conflict in the Persian Gulf, supplies were not interrupted. The head of the Ministry of Agriculture also spoke about the development of exchange mechanisms and incentives to attract market participants to trading.
"The food market is very sensitive to any major shocks"
— How successfully are the targets of the Food Security Doctrine for key products — grain, meat, milk and vegetables - being met in Russia? What is the dynamic?
— For us, the domestic market is a basic priority. The country must be reliably supplied with food. Today, in most areas, we are meeting the indicators of the Food Security Doctrine, and in a number of positions we are significantly exceeding them. For example, we provide ourselves with almost 170% grain. Fish — by 122.8%, and meat and meat products — by 101.7%. The level of self-sufficiency in vegetable oil is almost 2.5 times higher than domestic needs. Last year, we also exceeded the doctrine's target for potatoes and came close to the target for vegetables.
In other words, our market is more than secure. All this is the result of the complex development of the industry: investments, modernization, increased efficiency of enterprises, increased labor productivity, and many other aspects. Because food security is not just about having enough products at the moment. It is a stable system that can withstand bad weather, sanctions, and logistical disruptions, while ensuring that it provides the necessary food for humans.
In fact, it remains for us to achieve the target values for milk and fruits, and we are approaching them every year. Here you need to understand that these are areas with a long production cycle. For example, dairy farming cannot dramatically increase production in one season. We need to build farms, work with genetics, feed, and maintenance technologies. That's why we're moving consistently here.
At the same time, food security today is based not only on food products, but also on our own technologies, seeds, genetics, effective veterinary medicines, and agricultural machinery. That is, everything that allows us not to depend on external supplies and to safely pass any external restrictions.
— The UN World Food Program, in which our country is actively involved, has warned that this year more than 360 million people may be left without enough food, and tens of millions more are at risk of starvation. One of the main reasons is rising food prices and disrupted logistics due to the conflict in the Middle East. How well-founded are these concerns?
— Such risks cannot be ignored. The food market is very sensitive to any major shocks. Even if there are enough physical products in the world, the question is whether they can reach those who need them quickly, safely and at an affordable price. When routes change, costs increase, and calculations become more complicated, this immediately affects both the price and the availability of food.
The conflict in the Middle East has indeed required a restructuring of logistics. But our supplies to the region have not stopped. Russian companies have adapted, found alternative routes and continue to operate. Moreover, this year our exports to the Middle East are growing: by 15% in value terms and by almost a third in physical terms. If necessary, we are ready to expand supplies further.
I would like to emphasize that Russia remains a reliable supplier of not only basic products such as grain, but also vegetable oils, meat and dairy products, fish, confectionery, baby food and many other goods.
I'll tell you about humanitarian work separately. When it comes to countries where people really don't have enough food, it's a matter of moral responsibility for us. Russia is one of the largest grain exporters in the world, and we understand that the fate of specific families is behind each of our humanitarian supplies, for whom bread and basic products are a matter of survival. Therefore, on behalf of the president, we continue to help those who find themselves in the most difficult situation: we send wheat, fertilizers, and support partners where it is especially necessary.
In addition, for a number of countries today, we are becoming a supplier not only of agricultural products, but also of ready-made solutions to improve agricultural efficiency and provide food security on our own. Exports of agricultural technologies increased by about a third last year, to $16 billion. First of all, these are mineral fertilizers, for the supply of which we maintain global leadership. Today, they are bought by more than 100 countries on all continents. Exports of plant protection products, seeds, genetic material, vaccines, and biotech products are also growing. A separate area is agricultural education in our universities, which is becoming more and more in demand among international students.
In other words, we are already starting to compete not only in the food market, but also in the field of technology, knowledge and competencies.
"It is important for us to offer our product at the best price"
— According to the Federal Customs Service, exports of agricultural products decreased by 4.1% last year. Why did this happen and will it be possible to change the situation by increasing supplies to Asia, Africa and the Middle East?
— Exports of agricultural products last year amounted to $41.6 billion, which is indeed slightly lower than in 2024. But it is important to understand the nature of this decline correctly. We are not talking about the loss of markets or the potential of the industry. The only reason is a reduction in the supply of our key position, grain, the harvest of which was lower last year than in 2023.
At the same time, exports of deep-processed products increased by 12% last year. These are very important changes in the supply structure that allow us to maintain added value in our country.
Asia, Africa and the Middle East, of course, remain key destinations for us, and the potential there is great: the population is growing, consumption patterns are changing, and demand for high-quality food is increasing. But, of course, the competition in these markets is very intense. And here it is critically important for us to offer our product at the best price. If the high quality of Russian products is a universally recognized fact, then unfortunately, we do not always pass the price. It is clear that there is a history of exchange rate fluctuations, but basically, at the production level, we must be more efficient and cheaper than our competitors.
In addition, the task of the business is to work more accurately with specific markets: to understand consumer preferences, features and requirements of countries, to pay attention to packaging and promotion. A good product is one that knows its customer.
I would also like to note that we try to apply different export strategies for different product groups. An illustrative example here is sugar exports. Traditionally, our own production covers not only the domestic demand, but also the needs of foreign partners. Last year, the largest Russian producers formed a common plan for sugar exports outside the Eurasian Economic Union, which we, for our part, agreed upon. Accordingly, each participant had their own volume there. The implementation of this mechanism has made it possible to ensure price stabilization not only in domestic but also in foreign markets.
We are currently exploring the possibility of creating such consortia in other industries, primarily with a high concentration of manufacturers. At the same time, we are talking with our colleagues from Belarus about the application of this practice in relation to dairy products.
— Not so long ago, at a meeting with the president of the St. Petersburg International Mercantile Exchange, you discussed the possibilities of using this platform in the agro-industrial complex, including for trading agricultural products, mineral fertilizers and other goods. What exchange-traded instruments will appear for agricultural producers in the near future and how will they help the industry?
— The exchange is a part of a large market infrastructure: production, logistics, calculations, price. If we aim to reach 170 million tons of grain by 2030 and export up to 80 million tons, then we need modern and convenient channels of interaction between the producer, buyer, exporter and financial organizations. The first thing the exchange provides is a clear price guide. Large market participants, as a rule, feel the market conditions well. But it is often more difficult for a small or medium-sized agricultural producer to understand the fair price of his products. The stock indicator helps you see this based on real transactions.
The second is transparent calculations. The market is changing, traceability is increasing, and regulation on electronic waybills will start on September 1. And the exchange is well integrated into this logic here: goods, logistics, documents, calculations — everything should be in one civilized circuit.
The third is risk management. A producer often sells grain immediately after harvesting, not because it is the best price, but because he needs working capital: to close loans, pay off obligations, and prepare for the new season. In the future, exchange-traded and derivative instruments should make it possible not to sell "off the wheels" at the most unfavorable moment, but to fix the price, attract liquidity and insure against sharp market fluctuations.
There is already such an infrastructure for grain. In January, spot wheat trading was launched on the basis of the Novorossiysk CRT on the National Commodity Exchange, and in April - on the basis of Rostov—Azov. This expands the geography of trading and makes the price indicators more representative.
We are working on other bases together with the exchange. For example, in order to develop exchange trading in grain from the Volga region, we are working on bases in the Caspian Sea, including taking into account river logistics. We are also currently working with market participants to identify promising bases where there is storage capacity — first of all, of course, linear elevators. This will provide for domestic consumers, as well as provide an opportunity to form batches for subsequent supply to exporters.
So far, manufacturers have not yet got used to exchange-traded instruments, and here you can't just say: "Starting tomorrow, we're all going to the stock exchange." We are just against driving the market there administratively. Our task is to make this mechanism convenient so that the participants themselves see the benefits in it. To do this, we are working on incentives. There is already a priority for rail transportation of grain purchased at organized auctions. We are discussing the possibility of a discount on export duties.
A separate issue is the speed of calculations. For many manufacturers, this is even more important than the price: if the seller understands that the money will come quickly and without unnecessary difficulties, the motivation to use the exchange will be completely different. Therefore, we are working on making sure that payment takes place on the day of delivery, as well as the possibility of advancing the agricultural producer until the actual receipt of the products.
The next level is the development of exchange mechanisms for international trade, including the BRICS exchange, the initiative to create which is currently being worked out. For our countries, this is an opportunity to create their own price indicators, reduce dependence on external platforms and various price manipulations, and offer partners transparent and profitable trading rules.
"The price is not a thermostat that you can just put in the right position"
— What mechanisms does the Ministry of Agriculture have to curb unjustified price increases for basic foodstuffs? And how often do you have to use them?
— The price is not a thermostat that you can just put in the right position. This is the result of constant cost changes throughout the entire supply chain: energy, salaries, logistics, packaging, loans, raw materials. It is not often that we have to deal with unjustified price increases. As a rule, such processes have absolutely understandable reasons related to the cost increase.
The most important issue here is balance. Of course, food should be affordable for consumers, and this is also included in the Food Safety Doctrine. But at the same time, the manufacturer cannot work at a loss. If the economy of production breaks down, after some time it inevitably hits the market: investments decrease, supply decreases, and as a result, there is a risk of shortage or a new price spike. Therefore, it is not a solution to simply administratively "squeeze" the price. For a short period, it may seem that the measure worked, but for a long time you can get the opposite effect.
We work primarily with the balance of supply and demand. We constantly monitor the situation for key types of food: production, stocks, seasonality, import, export, cost, logistics. If we see risks, we use targeted tools — quotas, damping mechanisms, export duties, tariff incentives for the import of certain goods. The main task is not to clamp down on the market, but to adjust it where distortions arise. It is better to see the problem in advance and smooth it out carefully than to extinguish the fire later.
Predictability is also very important within the chain itself from the manufacturer to the shelf. Here we maintain long-term contracts between manufacturers and retail chains. For a supplier, this is an opportunity to understand how much and on what terms they will be able to supply, plan their production, purchase components, and logistics. For the networks, this means stable supplies and reduced dependence on short-term market fluctuations. And for the consumer, the dynamics of retail prices is more even.
And, of course, the most important task is to work on reducing costs and increasing labor productivity. This is exactly what we are constantly talking about right now. If an enterprise uses resources more accurately, reduces costs and reduces losses, then it can maintain a normal economy for itself and a more affordable price for the consumer. That's the right balance.
"Wine is sold through trust: to the region, to the producer, to the quality"
— This year, Russian wine received the highest award at the TERRAVINO competition in Israel — GrandChampion International. And besides her, there are 42 more: 11 double gold, 19 gold and 11 silver medals. How has the quality of our wines changed in recent years and how does participating in such competitions help promote them?
– Wine is sold through trust: to the region, to the producer, to the quality. And international competitions help to build this trust. We can all see how attitudes towards Russian wine have changed in recent years. Until recently, we had to prove even within the country that it can be high-quality, interesting, and competitive. Today, this stage has already been passed in many ways: our wines are offered in good restaurants, they receive professional ratings, and they become part of gastronomic tourism. Now a similar path is starting in foreign markets. Terravino is a good example. Thanks to the participation of Russian wines in this competition, the first batch of our sparkling wine was delivered to Israel last year.
We have the basis for growth in both the domestic and foreign markets: there are about 300 wineries of various formats operating in the country, from small family—owned to large ones, and enotourism is actively developing, which also works for recognition. In addition, our grape production is growing. Last year, we crossed the threshold of 950 thousand tons, which became a record in the entire modern history of the country. At the same time, farmers continue to plant at least 5,000 hectares of new vineyards annually, which, of course, creates a good base for further development of the industry.
— How effectively is the integrated rural development program being implemented? Are there any real results regarding the improvement of infrastructure and quality of life in rural areas?
— There are results. I will name just a few figures: since 2020, the state program has allowed the construction and repair of 6 thousand buildings. social facilities, improve the living conditions of 200 thousand families, improve over 14.5 thousand public spaces, and increase transport accessibility in more than 500 settlements. Behind each such figure, there are real changes that people feel: the child went to a modern school, the young family got a new home, a normal road, a parking lot, a sports ground and a cultural center appeared in the village. This is not an abstract infrastructure, it is a person's daily life.
The main indicator for us is whether people want to live in this place, work, raise children and connect their future with it. It is very important that our program is comprehensive. You can't build one facility and say that the territory has changed. If there is a job, but there is no housing, the person will not stay. If there is a school, but there is no medicine, this is also a problem. Therefore, we look at rural areas as a living system where all key aspects should develop together.
That is why we have now moved on to the logic of rural agglomerations and "strongholds". We have identified about one and a half thousand such territories, which are adjacent to more than 114 thousand settlements. Objectively, it is impossible to place the entire infrastructure in every small village. But this does not mean that a person should be cut off from opportunities. Our task is to create strong points of attraction for nearby territories and connect them with small settlements — transport, roads, social routes, and the Internet. Then even a small village becomes part of a single space where people have all the opportunities for a comfortable life and successful development.
In general, taking into account the current year, the activities of the state program will already cover about 20 million people, which is almost 40% of the inhabitants of rural areas and small towns. And for us, this is not just a figure in the report. These are people who are more likely to stay in their small homeland.
This is fundamental for the agro-industrial complex, because it is impossible to develop the industry without people who live near the production and see their future there.
"We need to get more from every hectare, from every farm, from every ruble invested"
— What are the key challenges facing the industry in the next three to five years? What targets are planned to be achieved?
— The main task for the coming years is to reach a new level of development. As I have already said, we are reliably providing ourselves with food in key areas.
The next stage is to produce not just more, but more efficiently: at lower cost, on our own technological base and with higher added value.
By 2030, the president has set a goal for our industry to increase the production of agricultural products by at least a quarter and increase exports by 1.5 times. But it is no longer possible to grow only due to new areas or an increase in livestock. Therefore, the main reserve today is productivity. To put it simply, we need to get more from every hectare, from every farm, from every piece of equipment, from every ruble invested. And that requires technology.
Since last year, we have been implementing the national project "Technological food security". It aims to create its own technological base for agriculture — from breeding and genetics to veterinary medicines, feed and food additives, machinery and equipment. Additionally, we have launched three large scientific and technological projects: agrotechnological, livestock and biotechnological. They work for a common goal. In crop production, we need to accelerate breeding: not just to create new varieties and hybrids, but to bring them to industrial seed production faster. Because agriculture is not interested in a scientific result in itself, but in an understandable effect — yield, resistance to diseases and pests, and quality. In animal husbandry, the logic is the same: you need to grow not by increasing the number of livestock, but by increasing productivity, which is provided by genetics, feeding, housing conditions, precise herd management and other factors.
Separately— biotechnologies and digitalization. We need our own enzymes, amino acids, starter cultures, feed additives, veterinary medicines — everything without which a modern agro-industrial complex cannot be technologically independent. And the figure should take over the routine: monitoring, paperwork, control, data collection, repetitive operations. A person should not waste time on the monotonous work that the system can do. His task is to make decisions.
All this requires a new generation of specialists. Because if we are talking about genomic breeding, biotechnologies, drones, digital monitoring, precision farming, then there must be people in the industry who know how to work with this. Therefore, the personnel issue today is part of the technological development of the agro—industrial complex. To do this, we are reassessing the entire training chain and building an end-to-end system, starting from school.
In short, in the next three to five years, we expect the agro–industrial complex to reach a new stage. The stage where we will chase not for a hectare, but for the efficiency of each hectare, not for the number of livestock, but for the return from each animal.
The future of food security is not just about having a product on the shelf. This is the country's ability to create technologies, produce competitive products, and confidently operate in domestic and global markets.
Переведено сервисом «Яндекс Переводчик»
