Russian-farmland.com
Support of agricultural business for foreignersIn Russia, crop production has become a very profitable business since 2014
What is the reason for such activity and profitability in the Russian agricultural complex?
There are several main factors:
1. This is what appeared rather large farms with a land bank from 100,000 to 2.5 million acres.
2. Sanctions led to the fact that Russia stopped purchasing many goods from other countries, especially European and American ones, which led to an annual growth in various sectors of 6–15% and in agriculture by 10–30%.
3. Russia entered the world markets for the export of grain, sunflower oil, coriander, soybeans and other agricultural products.
4. The arrival of foreign investors, and with them they brought new technologies.
5. In Russia it is forbidden to use GMO products, and for example, in China or Turkey, products from Russia are already a brand of environmentally friendly products.
6. Another important driver for the growth of Russian agriculture is the increase in the population on earth, and especially in China and India. Russian sunflower oil goes to China and India, wheat to the Gulf countries, coriander to India, and soybeans to China and Vietnam.
Who are these owners of companies that rank in the top five agricultural producers in Russia and what they grow and produce?
1. «Miratorg» remains the largest latifundist in 2020, and it is owned by two twin brothers, Alexander and Victor Linnikova, the company’s land bank exceeds 2.5 million acres.
The company specializes in:
- Production of our own high-quality feed. The main enterprises are located in the Belgorod and Bryansk regions and produce 1.5 million tons of feed.
- At 27 own pig farms fully automated and equipped with modern technologies, 423 000 tons of pork are produced.
- Beef production on own farms and slaughter enterprises. In 2019, 108 000 tons of beef were produced.
- At 19 own poultry farms, about 115 000 tons of poultry meat is produced.
- The unit for growing and processing grain in the amount of two objects occupy a total area of 1 million acres.
- The crop production division has produced more than a million tons of cereals, legumes and oilseeds.
- Another unit grows more than 4.7 million tons of sugar beets.
- The company's 16 sugar factories process more than 10 million tons of sugar beets per year.
- Agrocomplex company unites more than 40 enterprises of various profiles - rice growing, meat and dairy cattle breeding, crop production, pig and poultry farming, processing industry and retail.
- «Rusagro» holds a leading position in sugar production, pig breeding, crop production and the oil and fat business. The main assets of the «Rusagro» Group of Companies are located in Belgorod, Tambov, Sverdlovsk, Voronezh, Samara, Kursk and Orel regions, as well as in the Primorsky Territory. The Company has more than 15 brands, sells its products in 80 regions of Russia and in more than 35 countries of the world. The company's shares are listed on the London Stock Exchange.
- Agro holding develops business in five key areas: crop production, dairy farming, intensive gardening, vegetable growing, storage (elevators and warehouses) and trading of agricultural products in Europe, Africa and Asia.
- More than thirty livestock mega-complexes with loose housing and modern milking systems, daily milking amounts to 2 500 tons, and more than 1 million tons annually. The company has more than 103 000 feed cows. Milk enters both its 4 factories and the factories of the American PepsiCo and French Danone.
- The company has 4 milk processing plants in the Kaluga, Voronezh and Novosibirsk regions equipped with the latest technology and are steadily increasing production volumes.
- Production of feed for cows in own fields in 13 regions of the country.
- The company has its own divisions for crop production, a network of its stores and cafes.
2. The combined group «Prodimex» and «Agriculture», headed by Igor Khudokormov, owns a land bank at the same level – 2 163 000 acres.
The company specializes in:
The company concentrated in its hands some of the best chernozem lands of Russia located in the Voronezh, Belgorod, Kursk, Tambov and Penza regions, Krasnodar and Stavropol Territories, and the Republic of Bashkortostan.
The main owner of the largest Russian sugar producer, «Prodimex», Igor Khudokormov, through the offshore «Magna Investments Limited», acquired a 17% stake in the Swedish holding company «Agrokultura» (it controls almost 375 000 acres, of Russian agricultural land). The seller was the main owner of the Swedish holding company «Steenord» Ltd., from the British Virgin Islands - it was this company that bought up almost 47% of «Agrokultura» shares by the end of summer 2014.
3. The agricultural complex to them. «N. I. Tkachev», who is controlled by family members of the ex-governor of the Krasnodar Territory, and later by the Minister of Agriculture Alexander Tkachev.
Tkachev headed the Krasnodar Territory from 2000 to 2015, and the Ministry of Agriculture of Russia from April 2015 to mid-May 2018. The agricultural complex acquired 10 000 acres over the past year and reached 1 633 000 acres. The land of the Agro-holding is concentrated in the south of Russia, where one of the most fertile and expensive agricultural lands, the state of the family is estimated at more than 1.5 billion dollars, and the land assets of the family are about a billion dollars.
The company specializes in:
4. The «Rusagro» group of companies, headed by the main owner Vadim Moshkovich, over the past year has reduced its land bank by almost 20 000 acres to 1 610 000 acres, and for this reason the group of companies has moved from 3rd to 4th place in the ranking of the largest companies by version of the company «GeoBuro».
The company specializes in:
5. Concluding our rating, we will introduce the most active buyer of agricultural land - Agro Holding «Step», which is part of «AFK Sistema» owned by Vladimir Yevtushenkov. He has acquired over 350 000 acres over the past year.
Agro holding Evtushenkov had several major transactions. In March 2020, he acquired the «Rodnaya Zemlya» agricultural enterprise, previously owned by «Krasnodarzernoprodukt-expo», and leased land from «Zerno Don», both of which are located in the Rostov Region. In addition, «Step» has acquired three agricultural enterprises in the Stavropol Territory with a total land bank of 70 000 acres. Now the land bank of « AFK Sistema» companies has reached 1 400 000 acres, taking into account the lands of the «Step» Agro Holding and the «RZ Agro» joint venture, which the corporation owns on an equal footing with members of the French Louis Dreyfus family.
The company specializes in:
The holding’s land assets are located in the most favorable southern regions in terms of climate, productivity and logistics: Krasnodar Territory, Stavropol Territory, Rostov Region, Karachaevo-Cherkessia.
I also want to write out of the rating with another major landowner in Russia, until the last year for several years in a row he was one of the five largest landowners in Russia. But this year, Vladimir Yevtushenkov, the owner of «AFK Sistema», overtook him.
I will tell you about the German farmer Stefan Durran, who came to Russia 25 years ago and rented several hundred hectares of land. Now Stefan Duerra is the sixth largest landowner in Russia and the largest producer of raw milk, his company «Econiva», acquired this year about 250 000 acres and the land bank of «Econiva», reached 1 390 000 acres. Land assets are concentrated in the Voronezh, Kursk, Novosibirsk, Kaluga, Ryazan, Orenburg, Leningrad and Tyumen regions, as well as in the Republic of Bashkortostan and the Republic of Tatarstan.
The company specializes in:
We managed to introduce you to the top five players in the Russian agricultural production market in Russia. But in Russia there are another 50 companies that own from 250 000 acres to 1 390 000 acres. And about 200 companies that own between 50 000 and 245 000 acres of land assets. And these are only companies wholly owned by the Russians or jointly with foreign citizens. But I want to remind you that at the moment, more than a million hectares in the Far East and Siberia alone belong to Chinese companies and they rent about two million hectares from the State or farmers. In the Far East, approximately one million hectares are owned or leased by Korean entrepreneurs. Companies from Vietnam and other countries, the so-called Asian tigers, are actively entering the Far East. Altai is being mastered by companies from Israel and the USA. The European part is actively mastered by companies and entrepreneurs from the Scandinavian countries, the Baltic republics of the former USSR, as well as German and French farmers. In the south of Russia, for example, the Krasnodar or Stavropol Territory are interested in Investment Funds of the Arab countries, farmers (BURY) from South Africa, enterprising farmers from China and Turkey. Crimea is particularly worth it, farmers from Italy, France, Germany and Israel are very interested in it, but so far they are not actively buying up land, investing mainly in hotels near the sea.