Offbeat Struggling U.S. Farmers Have a New Worry: A Resurgent Russia
The Latest: Mattis says plane downing won't affect IS fight
U.S. Defense Secretary Jim Mattis says the shootdown of a Russian military aircraft by Syrian forces complicates relations between President Bashar Assad and the Russian government but has "no effect whatever" on the U.S. campaign to defeat Islamic State fighters in Syria. Mattis commented during a brief encounter Tuesday with reporters at the Pentagon. He says the incident is also a reminder of why the U.S. supports the United Nations effort to establish a political process for ending the civil war.
OTRADNAYA, Russia—Vladimir Mishurov transformed the remnants of the “Lenin’s Path” collective farm in this village into a profitable business. He also helped make Russia the world’s largest wheat exporter for the first time since the last years of the czars.
Over the past decade or so, Mr. Mishurov replaced his aging Russian equipment with a dozen high-tech machines from John Deere and other makers, and started using powerful new fertilizers and seeds. He bought and rented more acres from neighbors and family, eventually reaching about 3,600, taking advantage of Russia’s overall low prices for land.
Steven Mnuchin Accidentally Sanctioned Putin Oligarch Oleg Deripaska
At a Capitol Hill hearing in January, as lawmakers were hounding him about the Trump administration’s slow implementation of mandatory sanctions against Russia, Treasury Secretary Steven Mnuchin was backed into a corner. And he blurted out something he would come to regret—by accident, The Daily Beast has learned.“There will be sanctions that come out of this report,” Mnuchin said—a surprise statement, because while Congress had ordered the department to create a report on Russian oligarchs, it didn’t require that any sanctions be imposed based on it.
And as many farmers do in the U.S., he often worked days on end with little sleep, especially during the harvest.
The major difference between Mr. Mishurov and a farmer on America’s Great Plains: The Russian’s costs are lower, and mostly in rubles, making his overseas sales—priced in dollars—immensely more valuable.
Amid a multiyear, brutal slump in grain prices, Russian agriculture is thriving. The country exported more than 40 million tons of wheat in the year ending June, around 50% more than the previous year, and the highest level for any country in the past quarter-century. Russia overtook the U.S. as the world’s biggest exporter of wheat in 2016, and again beat the U.S. in 2018.
The Plot to Subvert an Election: Unraveling the Russia Story So Far
For two years, Americans have tried to absorb the details of the 2016 attack — hacked emails, social media fraud, suspected spies — and President Trump’s claims that it’s all a hoax. The Times explores what we know and what it means.On an October afternoon before the 2016 election, a huge banner was unfurled from the Manhattan Bridge in New York City: Vladimir V. Putin against a Russian-flag background, and the unlikely word “Peacemaker” below. It was a daredevil happy birthday to the Russian president, who was turning 64.
The growing Russian competition is one more pressure point threatening American farming, which is facing the biggest wave of farm closures in the U.S. since the 1980s. A global oversupply of grain has pushed prices down to around half the level in 2012, when prices peaked, making it difficult to turn a profit in dollars.
U.S. trade disputes with China and other countries could make Russian wheat even more attractive, if big buyers apply retaliatory tariffs to U.S. grains. China has added a 25% tariff on U.S. wheat, but Chinese restrictions on imports from Russia have prevented Moscow from taking advantage yet, according to Swithun Still, director at Switzerland-based Solaris Commodities SA, which trades Russian grain.
For now, “it’s not the trade war, it’s economics” that is helping Russian wheat compete, even in places close to the U.S. such as Mexico, Mr. Still said. Russian “quality got better, and it’s cheaper.”
'A disaster' but not 'Jurassic Park': The truth about farms and wildlife after Florence
'A disaster' but not 'Jurassic Park':(Greenville News) - While it remains too early to fully gauge the extent of the damage that Hurricane Florence leveled on crops and wildlife, it's clear most animals will be able to adjust more easily than many farmers in the eastern part of the state.
Russian farmers come out ahead when export earnings are converted into rubles. Since the Russian currency has depreciated, a dollar now converts to twice as many rubles as it did in 2014. Russia has a similar advantage against the euro and other currencies. Russian farmers can cover their costs at home to keep planting, and also undercut Western competitors on price.
Russia’s surge of agriculture exports, including grains, fish and meat, is part of an effort to diversify the economy away from crude oil. Oil and natural gas were once the source of half of federal budget revenues. With oil prices still down 25% from their high in 2014—recovering from a swoon of more than 60%—exports now account for around 40% of budget revenues.
“Given the fall in prices for oil, grain has come to the fore. Grain is our oil,” then-Agriculture Minister Aleksandr Tkachev said in 2016.
Less-expensive Russian wheat is pushing U.S. and European grain out of import-dependent countries in the Mideast and North Africa, where the Kremlin has made a military and diplomatic push for influence in recent years.
Why Russia is wooing South Africa’s white farmers
The sales pitch includes abundant land, relative safety and Putin’s disdain for the liberal West.That’s just what one Russian political figure hopes to hear.
Agriculture exports, at $20.7 billion in 2017, have overtaken the arms industry as Russia’s No. 2 earner. Wheat makes up about a quarter of the total.
Russia harvested an area of wheat almost twice as large as the U.S. in the year ended in June, according to the U.S. Department of Agriculture. American farmers, seeing little opportunity to profit, planted the smallest area of wheat since records began a century ago. U.S. wheat production shrank 25% in the year.
Mr. Mishurov’s farm is on the fertile steppe of southern Russia. The area is the country’s biggest grain producer—a bread basket known for its mineral-rich black earth and mild climate.
Now 46 years old, he spent his late teens and early 20s driving a bone-rattling tractor that needed its motor refurbished every year and left his hands callused. A lack of cash meant workers were paid in sacks of flour, wheat or sugar, and drunkenness was pervasive.
At the start of the 20th century, Russia had been the world’s largest exporter of wheat. The Soviets killed and imprisoned millions, including many of the most-successful farmers, as part of an effort to install a system of collective farming that proved inefficient. By the 1970s, the Soviet Union had to import grain.
Collective farms stumbled on after the Soviet Union collapsed in 1991, often still managed by the same bosses without business smarts or cash to invest.
Hamilton wins Russian GP after teammate lets him through
Lewis Hamilton won the Russian Grand Prix and closed in on his fifth Formula One title, but he's not happy.SOCHI, Russia (AP) Lewis Hamilton won the Russian Grand Prix and closed in on his fifth Formula One title, but he's not happy.
“No one was in charge,” said Mr. Mishurov. “They couldn’t adapt to the market economy. They were accustomed to unthinkingly following instructions.”
Farmhands worked “to pass the time of day until they could go home,” said Andrei Burdin, a farmer from a nearby village who works land that was once part of the “Dawn of Communism” collective farm. “Farming was at a dead end.”
Russia opened the land market at the end of the 1990s, but new investors and their managers tended to be far from the land and averse to risks, farmers said.
Mr. Mishurov, who worked as chief agronomist at a large farming conglomerate, recalled telling an executive in the early 2000s that using pesticide could increase the barley crop by around a quarter.
“ ‘No, Vova, it’s enough already,’ ” he said the executive replied, using a nickname. “Why should I persuade someone to earn more money?” Mr. Mishurov said.
He struck out on his own in the mid-2000s. At first, he pooled land with relatives and used whatever equipment he could lay his hands on. Today, he grows wheat, barley, beets, corn, sunflowers, peas and other crops.
Mr. Burdin, 43, started farming around 250 acres in 2005 with a dilapidated tractor and planter. He invested early profits into more-efficient vehicles and better fertilizer, and expanded territory by renting from neighbors.
“When we made the first money, I didn’t buy a Mercedes or an apartment,” he said. “I put it into the next season.”
At first, he bought Russian equipment, but later upgraded to John Deere tractors and combines, which the Russians call zelyonaya tekhnika, or “green machines.” Mr. Burdin said he tested a John Deere combine against a Russian one and found it produced about one-third more grain from the same area.
Did Trump’s ambassador to NATO threaten Russia with preemptive strikes?
Kay Bailey Hutchison set off a diplomatic incident with a nuclear edge.Although Ambassador Kay Bailey Hutchison’s comments were somewhat ambiguous, arms control experts said they could be interpreted to mean a preemptive strike against Russian missiles. Such a move could lead to nuclear war.
He also added a planter from Sweden’s Vaderstad AB that shoots seeds into the ground at the optimal depth and intervals, improving yields. He now farms about 3,700 acres.
In April, while loading the planter with seed, Mr. Burdin joked with farmhands about equipment in the old days. He recalled working with a pesticide sprayer that would soak him with chemicals. He said he could only work for about four hours at a time before giving up, out of fear for his health. Now, his sprayer can measure how much pesticide to spray and where, keeping costs down.
The price of land in the region where Messrs. Mishurov and Burdin live is significantly lower than for many foreign rivals. On average, farmland in Romania, a European Union member on the Black Sea, is nearly three times the price, while farmland in Iowa and Kansas is more than five times the price, according to a 2017 survey by Moscow-based SovEcon, which provides consulting services, analysis and forecasts on Russian agriculture.
Mr. Burdin said Russian seeds and fertilizers still cost less than Western brands, even though they have improved significantly in recent years. He buys wheat seeds from a state-run agricultural institute, and can plant the seeds produced from those plants the next season. Many American farmers use expensive, high-yield, patented seeds from companies such as Bayer AG or DowDuPont Inc., which don’t allow the produced seeds to be planted, requiring farmers to buy fresh seeds annually.
Transport costs are also low for the region. It is close to Black Sea ports, and gasoline costs are much lower than in Western Europe. Mr. Burdin and Mr. Mishurov run their own fleets of trucks that move grain to the Novorossiysk port some 200 miles away by road.
Private and state-owned companies have modernized grain terminals in recent years and increased their capacities. Farmers can use an app on a smartphone to book a slot for their trucks to deliver grain, rather than the old system of having trucks wait in line for days.
How Much You Should Have in Your Retirement Fund at Every Age
Save for retirement throughout the decades.
Bumper harvests are stretching infrastructure. Windows for unloading grain are snapped up quickly, and farmers are often assigned slots several days after a requested time, Mr. Burdin said.
Exports “could be even higher if they could figure out how to load more,” he said.
Russia has made it a priority. President Vladimir Putin ordered officials to tackle infrastructure bottlenecks that are holding back exports. In inland areas, large distances and a lack of train cars and storage silos hamper grain from reaching external markets.
One of Russia’s largest terminals in Novorossiysk is completing a three-year modernization this year that will nearly double its capacity. Other companies have announced plans to build or expand terminals on the Black Sea, the Baltic Sea in the north and in the Far East. Officials said expansions at ports could increase export capacity of grains by 50% to 7.5 million tons a month by 2020.
Government officials tout the importance of state subsidies, including inexpensive loans to help farmers replace old equipment. Analysts and farmers say the state’s efforts to support agriculture have been hit and miss. Subsidies often make their way to well-connected companies, investment in infrastructure has been slow and bureaucrats and other officials often expect bribes.
“Farmers received the freedom to do business in the way they thought most efficient,” said Andrei Sizov Jr., managing director of SovEcon. “The role of the state was quite muted in the last 10 years, and that was good for the industry.”
Giant agroholdings, conglomerates often created by wealthy tycoons or people close to top federal and regional government officials, have built up spreads that dwarf Western farms. Individual farms larger than 250,000 acres, or nearly 400 square miles, account for around 13% of all land farmed in Russia, according to Mr. Sizov.
Mr. Mishurov can now afford to collect and restore a half-dozen vintage Soviet cars and vacation in the Maldives and Thailand, although he said he prefers staying home.
The poor villages here depend on the generosity of wealthier farmers. Mr. Mishurov funded renovations to his village’s statue of Lenin and a monument to locals who died in World War II, while Mr. Burdin paid to fix up his village’s kindergarten.
Mr. Mishurov employs 10 farmhands, three guards and a cook who prepares meals for the workers. “It’s a lot for our acreage, but we try to preserve jobs in the village,” he said. One recent morning, a man dropped by Mr. Mishurov’s farmyard office to cadge a bucket of corn for his hens. It was a former collective farm boss.
Write to James Marson at email@example.com
Related video from WSJ: Trade Tensions Spike Between the U.S. and China
How Much You Should Have in Your Retirement Fund at Every Age .
Save for retirement throughout the decades.
PBS NewsHour full episode July 3, 2017
Monday on the NewsHour, as the GOP's health care bill struggles to find its course, the president of the March of Dimes weighs in on what's at stake for patients.
Dave Hughes, 1998
Popular Aussie comedian Dave Hughes gets the crowd laughing with his stories about work experience, stealing grapes and being on the dole.