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Is dishonesty 'endemic' in Russian farming? Your comments

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Velcourt, the UK agricultural consultancy and investor, sparked off quite a debate by accusing Russian farm workers of "endemic" dishonesty, and managers of showing a lack of accountability.

Some readers applauded the comments, reported exclusively by Agrimoney.com, with one saying that "the corruption and stealing is getting worse".

But others bitterly disagree, with Russia-based farmer Colin Freyr saying he was "spitting blood and feathers" over the allegations.

A selection of responses are printed below.

What do you think? For your say, write to Agrimoney.com at inquiries@agrimoney.com. Requests for anonymity will be strictly respected

'Stealing is just getting worse'

I am a Western man who has been working [in Russian farming] for over 10 years.

The article is the best I have seen for a long time. Investors do not understand the challenges.

The corruption and stealing is just getting worse at the moment at the rural areas of Russia. I could write a book about it. I am happy you brought up this issue.

Name supplied

Proper incentives get results

To my mind this article highlights the real problem, "seagull-style" management.

I read with dismay the comments from those with little experience and only a fleeting involvement with hands-on farming in Russia.

As someone with approaching 20 years' experience of agriculture and long term hands-on experience of farming in Russia, I know that when Russian farm management teams are incentivised, firstly by showing them respect and the recognition of the fact that we are operating in their country - understanding language and culture - they will work hard, they will work diligently and honestly and with a resilience that is to be admired.

At the risk of stating the obvious, yes, farming in Russia is a challenge and not for the faint hearted.

Yes, it's hardly likely there will be 10-tonne wheat crops. Yes, there is weather risk, something all farmers face.

Yes, irrigation is required if you want consistent yield and quality in root crops and vegetables.

What's new. Anyone entering Russia or any other country with a developing agriculture, surely does so with their eyes open and more importantly with an open mind. Not a bigoted view from the outset.

Colin Norman, chief executive, Freyr Farming

Are investors the problem?

Agrimoney.com's article on dishonesty in Russian agriculture struck a chord.

Theft is an issue for farming business in Russia and elsewhere but like any other operational issue you need to manage it.

This means having robust reporting and accounting procedures in place: having a weighbridge - you would be surprised on how many still use the soviet era manual weighbridge; having security; having security for your security; using technology such as fuel monitoring and GPS; and working with reputable buyers, sellers and service providers.

Each facet reduces the chances of theft, though you never entirely eliminate it you can manage it to tolerable levels.

In my experience, the greatest problem facing agri investments is not theft, but the investors themselves.

More often than not the investors and board are not farmers, but they position themselves to make the important decisions.

Too often they try to solve long term problems with short-term, knee-jerk solutions when the real issue is to get the fundamentals right first.

The problems stem from a lack of finance which means the farm manager has constantly to make concessions and to prioritise expenditure.

All my contacts, and me, do not complain about theft and dishonesty but of the same issues – the scarcity of equipment or working capital.

Dealing with theft is easy.

Dealing with investors is another thing.

The author, who preferred to write anonymously, is managing director of a private ag investment which farms more than 10,000 hectares in Ukraine

Not just in Russia

I currently manage rubber and palm plantations in West Africa as well as trade the production of these estates.

Previously I worked with one of the largest Malaysian groups in these product lines as well as a large US multinational

I find it most interesting that exactly the same issues that plague farming in Russia are those that plague farming in Africa and South East Asia. (Reference: Dishonesty mars Russia's development in farming.)

Theft will always be part and parcel of any business where you keep inventory. Ask makers of fast moving consumer goods, or even mobile phones.

Theft can is an operational hazard and has to be managed just like any other operational challenge.

The manager of the farm in Ukraine as on Agrimoney.com stated that rather than dishonesty being the greatest problem for agricultural businesses, it is the perspective of the investors, which tends to be very short term.

He is absolutely correct that scarcity of working capital and the reluctance of the investors/boards to continually invest in equipment in a timely manner is probably a bigger challenge.

Management is then forced to spend a lot of time and effort seeking solutions to these issues.

Taiwo Ajose

'You can deal with theft…'

I just read the last statement in Agrimoney which stated that you can deal with theft in Russia but the investors are the problem.

I would agree with this statement.

My company has been working in Eastern Europe for several years working on large projects with investor funding, and I would fully agree with this statement.

Wade Barnes, Canada

By Agrimoney.com

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