Russia has more than doubled its agricultural exports over the past decade, despite the Kremlin’s tit-for-tat ban on food trade with the EU that was imposed in 2014 after the annexation of Crimea, the Russian Ministry of Agriculture told TASS on August 7.

Europe was a major food trade partner, but after the imposition of the first sanctions in 2014, Russia broke those ties and began to pour investment into developing the sector. Agricultural production grew by a third (33.2%) during the same period, while agricultural exports have grown 2.6-fold.

In August 2014 Russian President Vladimir Putin imposed a food embargo banning the supply of meat, dairy products, fish, fruits and nuts from the United States, the European Union, Canada, Australia and Norway, after the first sanctions were imposed on Russia for the annexation of Crimea.

"This period became a milestone for the Russian agro-industrial complex, which showed significant growth in production, widespread introduction of advanced technologies and ensured our country's leadership in the global food market in many key areas," the Agriculture Ministry said.

Famously, Russia had to create a cheese industry from scratch, as it had become almost wholly dependent on imports of European cheese, which was of better quality and cheaper than homemade cheese.

Between 2014 and 2023, agricultural production grew by 33.2% and food production increased by 42.9%. Grain yields in particular soared thanks to heavy investment and Russia smashed Soviet records, producing an all-time record-breaking harvest in 2022 of 157.676mn tonnes, a 29.9% increase from 2021, and followed that with another bumper crop of the same size in 2023.

Russia has become by far the leading exporter of tradable grain in the world, much of which goes to clients in Europe, and less to the emerging markets such as Egypt and Africa.

More recently Russia’s grain exports to Europe, much of which is corn and used as animal feed or to make biofuels, has been caught up in the EU sanctions regime. The EU has imposed high tariffs on the importing of Russian grain to the EU, but the effect is muted by the low volumes.

Conversely, India has increased its imports of Russian grain to a record 9mn tonnes last year from a total of 67mn tonnes of grain exports in 2023, in addition to the ballooning amount of Russian oil it has been importing since the war in Ukraine broke out. (chart)

Agricultural exports rose to $43.5bn by the end of 2023, compared to $17.1bn in 2013. "Today, Russia exports food to more than 160 countries and is the world leader in the supply of wheat, peas, barley, oilseed flax, frozen fish, and occupies a leading position in sunflower oil and a number of other products," the ministry added.

Grain exports have become one of Russia’s biggest export earners after hydrocarbons, metals and arms.

The Ministry attributed this dynamic development to systematic state decisions aimed at protecting and supporting Russian producers. Funding for the State Program for Agricultural Development has more than doubled, up 2.2-fold, from RUB198.1bn ($2.26bn) in 2013 to RUB442.6bn ($5.06bn) in 2023.

"Achieving self-sufficiency in many respects made it possible to change the development model of the agro-industrial complex from import-substitution to export-oriented. In 2013, our country imported 2.5-times more food than it delivered to other countries. At the same time, since 2020 Russia has been a net exporter of food – exports exceed imports, and the gap between the indicators is growing annually. Thus, according to the results of 2023, deliveries to foreign markets were 24% higher than the volume of purchases from abroad," the Ministry of Agriculture noted, reports TASS.

Minister of Agriculture Oksana Lut says Russia is on course to further intensively develop the agricultural sector and strengthen its position as a guarantor of global food security.

"Today, we not only set ourselves the widest range of basic food products, but also have one of the most competitive, flexible and technological markets in the world. Russian companies are able to produce almost anything and adapt to any external conditions – this was well demonstrated by the situation in 2022-2023, when a number of foreign brands left the country. As in 2014, the vacated places were quickly occupied by local companies and consumers did not feel any changes," Lut commented.

Industry results

Since 2014, grain harvests increased from 92.4mn tonnes to about 150mn tonnes in 2023, while sugar beet production rose from 39.3mn tonnes to 53.2mn tonnes. The largest growth was seen in oilseeds production, which increased 2.-fold. Potato harvests reached 8.6mn tonnes by the end of 2023, 1.6 times higher than in 2013.

Fruit and vegetable production grew 1.7 times, reaching a record 7.5mn tonnes in 2023, including 1.64mn tonnes of greenhouse vegetables, which saw a 2.6-fold increase since 2013. Fruit and berry yields rose 2.8 times to a record 1.9mn tonnes by the end of 2023. Russia is the world’s biggest producer and exporter of raspberries, but remains heavily dependent on the import of Azeri, Uzbek and Turkish tomatoes. In 2022, world production of raspberries was 947,852 tonnes, led by Russia with 22% of the total.

Livestock and poultry production increased by 35.6%, from 12.2mn to 16.53mn tonnes, while milk production rose by 13.2% to 33.8mn tonnes. Fishing enterprises boosted their catch from 4.3mn to 5.4mn tonnes over the past decade, and commercial fish farming in the aquaculture segment grew 2.1 times to 402,000 tonnes.

The food industry has seen growth in nearly all areas. Vegetable oil production increased 2.5 times to 9.8mn tonnes, meat products by 84% to 9.8mn tonnes, and pasta production almost 1.5 times to 1.5mn tonnes. And the Russian cheese industry, benefiting from the food embargo, nearly doubled its output to 801,000 tonnes over the last 10 years.