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Collective farm emblematic of Russia’s new farm scene

This year’s wheat, piled in steel sheds on the Banner of Lenin collective farm, shimmers greyish gold in the dusty air, a vision of plenty worthy of a Soviet propaganda poster.

In Soviet times, the 15,000-hectare farm in Russia’s Black Sea breadbasket region of Krasnodar, stuck to growing wheat, but over the past two decades has turned itself into a one-billion-ruble- ($31-million-) per-year business producing wheat, fruit, sausages and sugar. It sells its 45,000 to 50,000 tonnes of high-quality milling wheat at the farm gate to be shipped to consumers such as Turkey.

It is emblematic of a Russian agriculture industry trying to establish itself as a global force.

That’s a far cry from the time of Soviet dictator Josef Stalin, who launched collectivization on these lands nearly 80 years ago. The town’s Bible was seized, its church razed and its people left to starve.

State quotas still governed the farm when Yuri Kharaman, a wiry man in his late 50s with a permanent sunburn from life in the fields, took over as the collective’s chairman.

“We don’t have that pressure anymore. We can focus on profit per hectare,” said Kharaman, who drives a sport utility vehicle and, like other members of the collective, owns a five-hectare share of the farm’s land.

Although hit twice by drought in the last three years, Russia is thinking big and aiming for grain exports of 40 million to 50 million tonnes by 2020.

For the Banner of Lenin farm, Russia’s re-emergence has brought modest prosperity and money for better technology, including John Deere combines to replace older models made in the nearby city of Rostov.

Growth potential

The potential for growth has not escaped the attention of Russia’s wealthy businessmen or the world’s largest agribusiness companies. Oleg Deripaska, owner of the world’s largest aluminum company, owns an 84,000-hectare farm in his hometown of Ust-Labinsk north of the regional capital of Krasnodar. And along the North Caucasus Railway, which carries much of Russia’s export grain to the Black Sea Port of Novorossiisk, stand Soviet-built grain elevators, now owned by Glencore, Louis Dreyfus, Cargill and Bunge.

It’s a sharp contrast to the final decades of the Soviet era, marked by heavy dependence on grain imports and a mass slaughter of livestock in the ’90s because of feed shortages. That had another consequence: Russia met the global commodity boom with its grain storage and transport infrastructure configured for import. It now requires billions of dollars in investment to modernize and expand to match Russia’s export ambitions.

Wealth has been slow to trickle down to farmers, too.

The collective’s shareholders receive 720 rubles per month in profits, plus a share of the farm’s output, which has expanded to include fruit, vegetables, flour, sugar and sausage, all produced and marketed under the Banner of Lenin brand. Average monthly salaries for the 1,100 regular employees are 21,000 rubles, and up to 30,000 ($920) for machinery operators.

Kharaman is among those who worry that Russia could again ban exports, leaving his farm to sell at depressed domestic prices.

“When wheat costs $300 on the world market, and we get $150, we can’t buy new combines, planters or tractors,” Kharaman said.

The town got its Bible back after Soviet rule collapsed, and there are plans to reconstruct the long-destroyed church.

Kharaman says he hopes the church will serve as a moral guide for his people.

“Before, we had Communist ideology, which had elements of religion,” Kharaman said. “Now there is no ideology at all, and there is a vacuum.”

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