To compete with large holdings

Yesterday, at an extended meeting of the Council of the Association of Peasant and Farm Enterprises (AKFH) of the Omsk Region, the President of the Russian Farmers Association, Vladimir Bashmachnikov, said that average farmers will be able to compete with large agricultural holdings only by cooperating with each other. But, not relying on their own strengths, the meeting participants asked the regional authorities for financial support for credit cooperation in the Prirtysh region in 2004. Farmers from the Novosibirsk, Tomsk, Kemerovo regions and Altai Territory were invited to the meeting. The main topic of discussion was the problem of developing the farmer movement and credit cooperation of farms.
President of the Association of Farmers of Russia (AFHR) Anatoly Bashmachnikov said that it is difficult for medium and small farms in the Russian Federation to break into the market, which is monopolized by large agricultural holdings. Farmer cooperation must change the current situation. “Only by helping each other will we be able to compete with large agricultural enterprises and firms,” said the main farmer of Russia.
Chairman of the Omsk AKFH Council Anatoly Altergot said that today there are 6.3 thousand farms and rural enterprises in the Omsk region. According to the Omsk AKFH, the number of small private farms in the Irtysh region is decreasing, but at the same time, the farmland cultivated by farmers increases annually by 35 thousand hectares. This growth comes from large farms. The share of such farms in the Omsk region is 4% of the total number of private owners, while they cultivate almost half of all farm lands in the region. “The weak are leaving the market; according to the Federal Tax Service, last year 1.2 thousand peasant farms were registered with a zero balance, which means that they are on the verge of bankruptcy or are closing. Natural selection is taking place,” explained Mr. Altergot.
The chairman of AKFH called the supply of equipment the main problem of small and medium-sized farms in the Omsk region. Thus, in 2003, private agricultural enterprises were able to purchase 41 combine harvesters and 2 tractors through leasing and bank loans, and only large farms afforded these purchases. Anatoly Altergot sees a solution to this problem in the creation of farmer cooperatives, through which private owners can pool together to update their fleet of agricultural machinery. According to the chairman of AKFH, the regional administration could provide support to small peasant farms by purchasing agricultural equipment with its own money and leasing it to farmers for 10-15 years with a subsequent right of purchase. As an example of farmer cooperation, the chairman of AKFH spoke about the creation by the association of Omsk farmers of a company for the purchase of grain from small private owners. In 2003, it already concluded contracts for the purchase of 1.7 million tons of grain.
AKFH places its main hopes on credit cooperation. As Vladimir Tyanin, general director of AKFH of the Omsk region, said, last year the first credit farming cooperative was created from 6 shareholders from different districts of the Omsk region. Today it already includes 34 shareholders; since the beginning of the year, the cooperative has issued loans to farmers for more than 1.1 million rubles. The Omsk association's immediate plans include the creation of similar cooperatives in three more districts of the Irtysh region, which will form a regional system of credit cooperation.
The result of the meeting was the decision of Omsk farmers to ask the administration and legislative assembly of the Omsk region to provide financial support for the development of credit cooperation of Omsk farmers in 2004.
Igor Butorin

Kommersant (Omsk) No. 115 dated 07/04/2003, p. 12

Farmers of Priirtysh united