Posted: Thursday, February 14, 2013 12:00 PM
Russia, Ukraine, Kazakhstan are projected to nearly double grain exports
By MATEUSZ PERKOWSKI
The collapse of planned communist economies in several former Soviet republics has put them on track to eventually surpass the U.S. in grain exports, according to USDA.
Russia, Ukraine and Kazakhstan are projected to increase their grain exports from less than 40 million metric tons to more than 70 million metric tons by 2021 -- exceeding U.S. grain exports by 87 percent, according to USDA.
A new report from the agency's Economic Research Service traces the grain export trend back to the early 1990s, when the disintegration of the Soviet Union upended agricultural policies.
Under Soviet rule, the countries were net importers of grain due to policies that emphasized livestock production, the report said. The goal was to increase meat consumption despite weak economic conditions.
The Soviet Union was unable to produce enough feed to support its livestock industry, forcing it to buy grain from overseas producers, the report said.
With the fall of communism, meat production plummeted in Russia, Ukraine and Kazakhstan, theoretically freeing up more grain -- primarily wheat -- for export, the report said.
At the time, however, grain production in those countries declined as farmers disregarded Soviet policies of planting marginal land, according to USDA.
By the 2000s, though, production rebounded due to increased yields from better farm management, improved machinery and higher quality seed, among other improvements, the report said.
These developments point to increased grain exports, but the trend will depend on better storage and transportation and may be hindered by revived livestock production, according to USDA.