Russia 'must not raid farming to lift arms budget'

Russia should not allow a desire, stimulated by the Ukraine crisis, to lift military spending to undermine support for farming, one of the country's top agricultural entrepreneurs said.

Stefan Duerr - founder of the EkoNiva group of agricultural companies, which stretch from dairy production to tractor sales said that said that the situation for Russian farmers was currently "not so bad", with prospects from Moscow for support more than outweighing the current fallout from the annexation of Crimea.

"The state once again is declaring farming among its priorities, meaning that it will support the farmers and enable them to turn out more food," Mr Duerr said.

Vladimir Putin, the Russian president, last month ordered the government to work on measures such as improving road infrastructure and setting up agricultural wholesale distribution centres to support the country's shrinking rural population.

At 37.1m, it accounts for 26% of the country's total population, down from figures of 42m, and 30%, in 1980.

'Consequences may be severe'

However, the threats by Western powers of economic sanctions against Russia following the invasion of Crimea had put the country "in a rather vulnerable position" which represented a significant threat to farmers.

"Effective development of the farming industry needs imported agricultural equipment, seeds, chemicals, veterinary preparations, semen," Mr Duerr said.

If the breakdown of relations between Moscow and the West led to sanctions, farming could be "hit really hard and the consequences may be severe".

'Food security just as important'

The fallout from the Ukraine ructions could also cause domestic damage to farmers' interests, if it inspires Russia to build up its military spending at the expense of investment in agriculture.

"Another consequence of the crisis may be the build-up of the defence budget.

"It is desirable that this not happen at the expense of funds allocated for developing the farming sector, since food security is just as important as military security," Mr Durr.

"People must be supplied with domestically produced food and the country must be duly protected against foodstuff shortages."

Putin plaudit

The comments came in a message to celebrate 25 years of his empire, which includes the Ekoniva Group, which claims to be Russia's biggest milk producer with output of more than 400 tonnes of milk a day from 46,500-strong cattle herd besides having a large arable operation within its 196,000 hectares of land.

Mr Duerr, a German national, was late last year granted Russian nationality by Mr Putin "in recognition of his achievements for Russia's agricultural industry".

He was in 2009 awarded the German Federal Cross of Merit for his contributions to agricultural policy dialogue between Germany and Russia.

SovEcon, the Moscow-based agricultural analysis group, on Tuesday raised by 2m tonnes to 90m tonnes its forecast for Russia's grains harvest this year, including 50m tonnes of wheat, citing the extra supplies from Crimea.

The forecast for grain exports was also raised, by 2m tonnes to 24m tonnes, including 17.5m tonnes of wheat.

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