RECENT DEVELOPMENTS IN SOVIET AGRICULTURE

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79R01141A002500100002-0
• Release Decision: RIFPUB
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• Document Page Count: 36
• Document Creation Date: December 23, 2016
• Document Release Date: May 30, 2013
• Sequence Number: 2
• Publication Date: November 1, 1962
• Content Type: REPORT

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N? 130
RECENT DEVELOPMENTS
IN SOVIET AGRICULTURE
November 1962
NOT TO BE REPRODUCED IN WHOLE OR
IN PART WITHOUT THE PERMISSION OF
THE CENTRAL INTELLIGENCE AGENCY
CENTRAL INTELLIGENCE AGENCY
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NOTICE
This report has been loaned to the recipient
by the Central Intelligence Agency. When it
has served its purpose it should be destroyed
or returned to the:
CIA Librarian
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Washington 25, D. C.
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RECENT DEVELOPMENTS
IN SOVIET AGRICULTURE
CIA/RR ER 62-3 3
CENTRAL INTELLIGENCE AGENCY
Office of Research and Reports
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FOREWORD
The Soviet leadership is becoming increasingly concerned with
stagnation in the agricultural sector, a sector that employs about
one-half of the labor force in the USSR. Of 33 formal public
speeches made by Khrushchev in 1961, 16 were devoted exclusively
to agricultural problems, and, during the year, Khrushchev spent
a total of 32 days on personal inspection tours of the main farming
areas.
Soviet agricultural problems embrace several basic, interrelated
policy issues, as follows: the position of agriculture in the scale
of national priorities; the roles of Party officials, managers, and
technical specialists in agricultural administration; land use; and
the continued low level of collective farm income. These issues are
discussed in this report, the agricultural situation is investigated,
and the current Party programs intended to stimulate Soviet agri-
culture are evaluated.
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CONTENTS
Page
Summary and Conclusions
I. Situation in 1961 5
II. Falsification of Statistics 8
III. Decreasing Importance of Collective Farms 10
IV. Problems 12
V. Proposed Solutions 13
A. Reorganization of Agricultural Administration ? ? 14
B. Priority of Agriculture 17
C. Changes in the Cropping System 23
D. Material Incentives 27
VI. Prospects for 1962 30
Tables
1. Reported Number of Livestock in the USSR on 1 January
1961 and 1962 7
2. "Productive" Capital Investment in Soviet Agriculture,
1951-61 and 1962 Plan
3. Allocation of Trucks, Tractors, and Agricultural
Machinery to Soviet Agriculture, 1953-61 and 1962 Plan
4. Production of Mineral Fertilizer in the USSR, 1958-61
and 1962 and 1965 Plans
Charts
18
20
22
Figure 1. USSR: Distribution of Sown Acreage by Sectors,
1958 and 1961 11
Figure 2. USSR: Distribution of Sown Acreage by Sectors,
1953 Through 1961 12
Figure 3. USSR: Organization of Agricultural Adminis-
tration following page 14
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RECENT DEVELOPMENTS IN SOVIET AGRICULTURE
Summary and Conclusions
The stagnation of Soviet agriculture during the first 3 years of
the Seven Year Plan (1959-65) has led the USSR to a two-pronged effort
to raise output. The more important move is a planned shift in the
cropping pattern during the next few years over an area of 41 million
hectares* (about 20 percent of the total sown area in 1961), a shift
that will virtually eliminate the grass-rotation system and severely
restrict the practice of clean fallowing. The objective of this move
is to increase the supply of meat and milk by stepping up livestock
feed supplies. The second facet of the new program, and one less
likely to boost output, is the reorganization of agricultural adminis-
tration, which puts the Party machinery firmly in control of agri-
cultural production. Opposition to the elimination of the grass-
rotation system may have generated the decision to provide a clearer
delineation of authority and an integral role for the Party in agri-
cultural administration.
Khrushchev claims to-have discovered certain "hidden reserves" in
arable ldnd. These reserves actually are the 64 million hectares in
sown perennial grasses, oats, and clean fallow, 41 million hectares
of which are now to be shifted to cultivated crops -- corn, peas,
field beans, and sugar beets. Khrushchev's new proposal is a radical
move. Because of the shortage of mineral fertilizers, as well as of
farm machinery, sown perennial grasses in the crop rotation provided
economical feed while at the same time returning nitrogen to the soil
(the so-called "ley system"). Clean fallowing is designed to increase
and stabilize crop yields in semiarid regions by restoring soil mois-
ture.
In 1962 the total sown area was expanded by 11 million hectares,
or about 5 percent. In addition, about 16 million hectares in grass
and oats were shifted to other crops. Because some production was
already being obtained from the area formerly in grass and oats and
because harvesting delays seem likely to reduce yields somewhat, it
is expected that the net increment to production in 1962 resulting
from the expanded sown area and Khrushchev's change in the cropping
pattern probably will be no more than 5 percent, given average
weather conditions.
* One hectare equals 2.471 acres.
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Over the next few years, as additional land is brought under con-
tinuous cultivation, further increases in output are possible. These
increases will entail a large increase in the volume of fieldwork. In
the long run, however, the new program is likely to be self-defeating
as soil moisture and nutrients are exhausted. For these reasons, the
Soviet leadership is embarking on no more than a stopgap that provides
no permanent solution to improving the quality of the Soviet diet.
For Western observers the task of appraising progress in Soviet
agriculture is made more difficult by the questionable validity of
Soviet statistics. In particular the official data on production of
grain in recent years appear highly inflated compared with the his-
torical series. There appears to be a greater degree of falsification
in the statistics on production of meat in 1961, particularly those
for the private sector, than in previous years. Finally, the reported
large increases in livestock herds do not tally with the estimated
availability of feed. In summary, the unsatisfactory agricultural
situation is believed to have caused some deterioration in the quality
of the average Soviet diet in recent years, and the accuracy of Soviet
statistics may have suffered in an effort to obscure this fact.
The reorganization of agriculture in 1962, which followed the Party
Plenum in March, clarifies responsibility and formalizes Party author-
ity in an attempt to make centralized control more effective. This pro-
liferation of the control apparatus is not expected to have a favor-
able effect on production of crops or livestock. The administration
of agriculture is now vested in an All-Union Agricultural Committee
with subordinate committees at the republic and oblast levels. The
execution of the policies and decisions of these agricultural commit-
tees is carried out by Ministries of Production and Procurement at
the republic level, Directorates of Production and Procurement at the
oblast level, and Interrayon Production Directorates at the local level.
In spite of indications that additional investments will be made
available to agriculture and agriculture-supporting industries, it is
evident that agriculture will not be given a priority position equal
to defense or heavy industry. Additional investments in the kolkhoz
(collective farm) sector will have to come from internal sources. The
financial situation of the kolkhozes, however, has been improved some-
what by reductions in the prices for machinery, fuel, spare parts,
building materials, and metal and metal products; tax concessions have
been made on income received from production of livestock; loan periods
for machinery purchased from machine tractor stations (MTS's) have been
extended; interest rates have been decreased; and the state now pays
all transportation costs for the delivery of agricultural products to
procurement centers. In addition, prices for livestock purchased from
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kolkhozes and individuals have been increased by an average of 35 per-
cent in order to stimulate the lagging animal husbandry sector, which
has been operating at huge losses on most farms.
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I. Situation in 1961
According to the official Soviet index (which is believed to over-
state the increase), gross agricultural output in the USSR in 1961 was
only 5 to 6 percent greater than in 1958. Thus little progress has
been made toward the 70-percent increase in gross agricultural produc-
tion called for by the Seven Year Plan (1959-65).
The winter of 1960-61 in the USSR was unusually mild, with greater-
than-average precipitation over most of the principal agricultural
regions. Northern Kazakhstan and the Urals were the only important
agricultural areas in which moisture was in relatively short supply
at the beginning of the crop season. Also, spring in 1961 arrived
early, with temperatures averaging much above normal during March and
April. Crop prospects, which were judged to be better than average
early in the crop season of 1961, tended to deteriorate slowly as the
summer progressed. Less-than-average precipitation for periods of a
month or more occurred during the growing season in most of the prin-
cipal agricultural areas. Prospects for production of crops were
judged to be about average by the end of the crop season.
Spring fieldwork was aided by the early arrival of warm weather
in 1961. Spring planting, after an early start, was slowed by rains
late in April and in May. Although the plan for spring seeding re-
portedly was overfulfilled, the sown acreage in the USSR in 1961 in-
creased by less than 2 million hectares to a total of 205 million
hectares. The acreage of grain crops, after having been reduced dur-
ing the preceding 2 years, returned in 1961 to about the level of
1956-58. This increase in grain acreage was largely offset by a re-
duction in the acreage of forage crops. Small increases in acreage
were reported for cotton, sugar beets, and sunflowers.
Soviet grain acreage in 1961 was about 128 million hectares. This
total included 115 million hectares of small grain and 13 million hec-
tares of corn, harvested either as fully mature grain or in the milky-
waxy (silage) stage of maturity, with the ears being converted to a
dry-grain equivalent.
Winter grains in the southern part of the European USSR benefited
greatly from the mild, moist winter, and a bumper crop was produced.
The spring wheat crop in much of the new lands, however, was damaged
by drought. Also, dry weather during June and July in the southern
part of the European USSR limited the yields of most late crops to
about average levels.
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The USSR claims that about 137 million tons* of grain were produced
in 1961, 3 million tons more than were claimed in 1960 but still short
of the record 141 million tons claimed for 1958. Soviet statistics on
production of grain since 1958 appear to be highly inflated, although
the reason or reasons for this inflation cannot be determined with
certainty. Several factors that may account for part or all of the
statistical inflation are the inclusion of excess moisture and trash
in the grain, statistical manipulation or falsification by Soviet
officials at the various administrative levels, an unannounced change
in the definition of grain, or a change in the methodology used by the
USSR in estimating the amount of grain that was produced.
Based on reports of crop conditions, on weather information, and
on data on grain acreage, it is estimated that the total production of
grain in 1961 was about 115 million tons, roughly one-sixth more than
the estimated production in 1959 and 1960 but still short of the record
harvest in 1958. The biggest change in production of any individual
grain between 1960 and 1961 was in wheat. In 1960, largely because of
extensive damage to winter wheat from winterkill and spring dust storms,
a very small crop, estimated at 46 million tons of wheat, was produced.
It is estimated that, in 1961, 55 million tons of wheat were harvested,
a crop about equal to the 1955-59 average.
Output of cotton, sugar beets, fiber flax, and sunflowers in the
USSR in 1961 is estimated to have been about average. Production of
cotton, at 4.52 million tons of raw (unginned) cotton, was 5 percent
larger than the mediocre crop of 1960 but still slightly less than
the good crop of 1959. Cotton yields were somewhat lower than in any
year since 1955. A total of about 63 million tons of sugar beets was
produced. Of this amount, about 48 million tons were procured for
processing by the sugar industry. Sugar beet yields in 1961 were
somewhat below the average for 1956-60. Production of fiber flax in
1961 reportedly was 403,000 tons, a decline of 5 percent in comparison
with the level of output in 1960.
The USSR claims that a record crop of 4.71 million tons of sun-
flower seed was produced in 1961, a crop about one-fifth larger than
the crop for 1960 of almost 4 million tons. A crop this large is
surprising in view of prevailing conditions. The increase in sun-
flower acreage in 1961 was only 20,000 hectares, an increase of less
than 1 percent. Also, dry weather was experienced during the growing
season over the main sunflower growing areas, a condition that does
not appear to be consistent with the harvesting of near-record yields.
The size of the sunflower seed crop, however, may have been determined
before the onset of the dry weather.
* Tonnages are given in metric tons throughout this report.
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Production of potatoes, vegetables, and livestock feed in 1961 was
close to the average for recent years. The acreage in potatoes and
vegetables was slightly smaller in 1961, and the acreage in fodder
crops was about 5 million hectares less than the record 57 million
hectares planted to these crops in 1960.
The USSR during 1961 claimed to have attained some limited success
in its livestock industry. The success claimed, however, was confined
primarily to a buildup of livestock herds. Increases in the number of
livestock during the calendar year 1961 are shown in Table 1, and re-
portedly the increases in the number of cattle and swine represent the
largest annual increment to these herds in the postwar period. These
increases are surprising, for the feed supply from the growing season
of 1961 appears to have improved little, if any, over that of a year
earlier.
Table 1
Reported Number of Livestock in the USSR on 1 January
1961 and 1962
Million Head
1961
1962
Percentage Increases
Cattle
75.8
82.1
8
Of which:
Cows
34.8
36.3
4
Swine
58.7
66.6
13
Sheep and goats
140.3
144.4
3
The USSR claims that 8.8 million tons of meat were produced in
1961, an increase of about 1 percent in comparison with the 8.7 mil-
lion tons claimed for 1960. It is believed, however, that production
of meat in 1961 actually declined somewhat. The USSR has admitted
officially that production of meat in the socialized sector in 1961
declined by about 8 percent, from 5.1 million to 4.7 million tons.
Thus to reach the claimed total, production of meat from the private
sector would have had to increase by 14 percent, from 3.6 million to
4.1 million tons. The past relationship between privately owned
livestock herds and production of meat from the private sector does
not suggest any such increase.
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A total of 62.5 million tons of milk reportedly was produced in the
USSR in 1961, an increase of 800,000 tons, or 1.3 percent, in comparison
with output in 1959 and 1960. The number of cows continued to increase
during 1961 and was 4 percent larger on 1 January 1962 than a year ear-
lier. A reduction in milk yield per cow had a tendency to offset the
increase in the number of cows.
The over-all supply of food in the USSR is sufficient to prevent
nutritional deficiencies. The quality of the average diet, however,
is believed to have deteriorated somewhat in the past several years.
Khrushchev stated at the Party Plenum of March 1962 that "production
of meat is behind the growth in demand." Fats and oils probably were
in relatively short supply, but per capita supplies of fish and sugar
were at record levels in 1961.
II. Falsification of Statistics
Western analysts of Soviet agriculture generally have agreed that
there has been considerable exaggeration in the official Soviet sta-
tistics on production of some of the major agricultural commodities in
recent years. As previously indicated, statistics on production of
grain, in particular, appear to be highly inflated since 1958.* Also,
official claims for production of meat and for the number of livestock
in 1961, as well as for the sunflower seed crop, are suspect.
At the Party Plenum of January 1961, Khrushchev bitterly denounced
the practices employed by dishonest persons in order to fulfill or
overfulfill plans and pledges. Admissions of "fraud and deception"
were made at the Plenum by most of the Party first secretaries from
the constituent republics of the USSR. These confessions by top
echelon Party leaders were indicative of the widespread nature of
statistical falsification in agriculture. The full extent, geographi-
cally speaking, of the "fraud and deception" in agricultural reporting
was revealed in a vigorous press campaign conducted for several months
following the Plenum in January. Government and Party leaders from the
farm level to at least the republic level, as in the case of Tadzhiki-
stan, were implicated either directly or indirectly as knowledgeable of
the deception. Statistical falsification generally was included among
charges leveled against many government and Party leaders who were re-
moved from office and even expelled from the Party after the Plenum in
January.
The seriousness of the national scandal relative to statistical
falsification was indicated by the issuance of a decree in May 1961
that invoked a prison sentence of up to 3 years for those persons
* I, p. 6, above.
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guilty of making "inflated entries in state accounts or other de-
liberate distortions of accounts on the fulfillment of plans." In
July 1961 the State Control Commission (Goskontrol) of the Council
of Ministers, USSR, was reorganized as a union-republic agency "in
connection with national economic tasks and the need to intensify
checking on the execution of government decisions from top to bottom
and to strengthen further state discipline." Among other duties this
expanded commission was charged with "controlling the state of account-
ing and state reports and uprooting the padding of state reports, de-
ceit, and hoodwinking."
The widespread falsification of statistics in recent years prob-
ably resulted in a significant upward bias, for most of the falsifi-
cation was generated by pressures to fulfill or overfUlfill plans or
pledges. Downward revisions of some production statistics logically
could have been expected at least for 1960. However, in two principal
statistical handbooks published by the USSR in 1961 SSSR v tsifrakh
v 1960 godu (The USSR in Figures in 1960), published in March 1961,
and Narodnoye khozyaystvo SSSR v 1960 godu (The National Economy of
the USSR in 1960), published in August 1961 -- no downward revisions
were made in the production statistics for any of the major agri-
cultural commodities except cotton. Downward revisions could not
have been expected in the handbook published in March, for its publi-
cation preceded many of the public disclosures of statistical mal-
practices. In the handbook published in August, although the later
date should have enabled control organs to audit some accounts and to
make adjustments where necessary, production figures for many com-
modities as well as for the index of gross agricultural output were
even higher than those published in the handbook in March.
Although small revisions, usually upward, are not unprecedented in
Soviet statistics on agricultural production, the upward revision for
such a large number of commodities in view of the disclosures of wide-
spread falsification is most unusual. Soviet statistical policy, how-
ever, is clearly against making downward revisions in national sta-
tistics, as expressed recently in the Soviet statistical journal
Vestnik statistiki, as follows:
... The perversions of accounting data by individual
workers did not influence the over-all totals of statis-
tical works, because the basic indices of the development
of the national economy of the USSR are mutually controlled
and made precise on the basis of comparability of the dif-
ferent sources and of all-round economic and statistical
analysis. These national economic totals do not and can-
not arouse any doubts.
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Although this statement may be true for statistics on those com-
modities over production of which the Soviet government has complete
control, it is not true for statistics on agricultural production,
because such statistics are not easily verified by central authorities.
The nature of production and utilization of agricultural products pro-
vides convenient opportunities for deception. Farm managers and other
officials have many opportunities to manipulate the statistics, espe-
cially for the share of farm production that remains on the farm.
Furthermore, although the government has fairly firm statistical
control over that part of agricultural production which it procures,
collusion among procurement and other officials to pad the accounts
cannot be completely controlled. That all cotton is procured by the
state and that production statistics can be verified by ginning
records did not prevent high-level collusion to falsify the data in
Tadzhikistan.
III. Decreasing Importance of Collective Farms
At the meeting of the Supreme Soviet of the USSR in March 1958
that ratified the reorganization of machine tractor stations (MTS's),
Khrushchev took the radical position that sovkhozes (state farms)
should not be considered a higher form of socialist agriculture than
kolkhozes and even went so far as to suggest that sovkhozes adopt
the "democratic" procedures ostensibly inherent in the kolkhoz.*
Khrushchev's theses on the Seven Year Plan, presented in November
1958, specifically limited the future growth of the sovkhoz system
by setting modest investment and procurement goals for this sector.
In his report to the 21st Party Congress, held in January 1959,
Khrushchev spoke of the need to develop both sovkhozes and kolkhozes
and warned against forcing the merger of the two systems. Since the
21st Party Congress, Khrushchev has continued to speak of strengthen-
ing the kolkhoz system and furthering its development. In his report
to the 22d Party Congress in October 1961, Khrushchev said that kol-
khozes and sovkhozes will continue to develop side by side. The fol-
lowing month, at Tashkent, he repeated this policy, stating as a
"principle" that he is against the conversion of "weak" kolkhozes to
sovkhozes.
In spite of Khrushchevis reiterated support of the kolkhoz system,
the conversion of kolkhozes to sovkhozes has been very rapid. The
number of sovkhozes grew from 6,000 in January 1959 to 8,300 in
January 1962, largely as the result of the conversion of kolkhozes
to sovkhozes. During this period the state sector added 30 million
hectares to its sown acreage, an increase of about 50 percent, while
* In March 1962, Khrushchev admitted that kolkhoz democracy is a
fiction.
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the sown acreage of the kolkhozes declined by 21 million hectares (see
Figure 1). During the period from 1 July 1959 to 1 July 1961, the num-
ber of workers occupied in the state agricultural sector increased by
2.7 million because of conversion. By 1960 the sovkhoz share in the
delivery of grain and milk to the government exceeded the level set by
Khrushchev for 1965 in his theses on the Seven Year Plan.
USSR: Distribution of Sown Acreage by Sectors,1958 and 1961
PRIVATE
7 million hectares
4%
STATE
29%
57 million
hectares
COLLECTIVE
67%
132 million hectares
1958
196 Million hectares
36575 9-62
PRIVATE
7 million hectares
STATE
43%
87 million COLLECTIVE
hectares
54%
111 million
hectares
1961
205 Million hectares
Figure 1
Khrushchev has given an incomplete explanation for the growth of the
sovkhoz system. At the 22d Party Congress he explained that the system
had grown because of the need to set up new sovkhozes, both to reclaim
the new lands and to supply the urban and industrial centers. Actually,
during the peak years (1954-56) of the new lands program, sown acreage
in the state sector grew less than kolkhoz sown acreage. Since 1956,
however, the share of the state sector in the total sown acreage has
grown from 18 percent to almost 43 percent, largely through conversion --
a conversion that has gone far beyond the scope of the new lands and the
suburban farm programs (see Figure 2).*
* Following on p. 12.
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Figure 2
USSR: Distribution of Sown Acreage by Sectors, 1953 Through 1961
150
125
COLLECTIVE FARMS
...
50
25
...
1953 1954 1955 1956 1957 1958 1959 1960 1961
36574 9-62 *Includes state farms (Sovkhozy) and other state agricultural enterprises
Thus, contrary to Khrushchev's past policy statements and contrary
to his theses on the Seven Year Plan, kolkhozes have declined rapidly
in relative importance. In view of past inconsistencies, there is
little reason to give credence to Khrushchev's latest pronouncements
on conversion. In fact, the latest plan for the delivery of agricul-
tural products to the government in 1962 specifies an increased share
for the sovkhozes, indicating that conversion is expected to continue.
If conversions continue at the 1960-61 pace, in the next year or so
the sovkhoz will replace the kolkhoz as the dominant institution in
Soviet agriculture, a position that the kolkhoz has held for the past
30 years.
IV. Problems
During the first 3 years of the Seven Year Plan (1959-65), Soviet
agriculture has continued as the chronically weak sector of the economy
of the USSR. Whereas gross industrial output increased by 33 percent
in 3 years instead of the 27 percent envisaged by the Seven Year Plan,
agricultural output at the end of 1961 had progressed very little to-
ward the goal for 1965 of a 70-percent increase in comparison with
1958. According to Khrushchev, in 1961 the officially reported
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production of grain, meat, and milk was short of the goals for 1961 as
envisaged by the Seven Year Plan by 16.4 million 3.0 million, and
16.0 million tons, respectively.
The lack of significant progress in Soviet agriculture is in part
due to the fact that 1958, the base year of the Seven Year Plan, was
an excellent crop year, whereas the succeeding 3 years have been only
average or below average. In part, the lack of progress has been
caused by the chronic shortcomings of the agricultural sector -- in-
adequate material incentives to the farmers; inadequate investment,
as reflected in a shortage of critical machinery, spare parts, and
mineral fertilizers; and ineffective, overcentralized direction.
Lack of progress can be attributed also to the position of agricultural
science in the USSR. Too often, scientists engaged in agricultural
research have not only lacked the requisite freedom for conducting
research but also have been forced to tailor agricultural science to
ideological and Party demands. The dilemma of the agricultural scien-
tist is epitomized by P.A. Vlasyuk, President of the Ukrainian Academy
of Agricultural Sciences, whose frank admission that the scientists
carry out the assignments of the Party evoked a scathing denouncement
by Khrushchev for "bootlicking and kowtowing." Not to have heeded
Party assignments, however, would have meant risking loss of position,
ostracism, and, in earlier times, even prison sentences.
The unsatisfactory situation in agriculture has been of special
concern to Khrushchev because he has been intimately associated with
the agricultural policies and programs adopted after the death of
Stalin in 1953. As a result of measures implemented under Khrushchev,
gross agricultural output in the 1954-58 period increased by 35 per-
cent in comparison with the previous 5-year period, and in 1958, a
year of exceptional weather, a record crop raised output to 50 per-
cent more than in 1953.
Khrushchev's intense preoccupation with the badly lagging agri-
cultural economy is evident from the attention given to it by the
Soviet leader in 1961. Of 33 formal public speeches made by Khrushchev
in 1961, 16 were devoted exclusively to agricultural problems. Follow-
ing the discussions on agriculture at the Party Plenum in January and
again after the 22d Party Congress in October, Khrushchev spent a total
of 32 days on personal inspection tours of the main farming areas in
the USSR. His visits to the primary grain-producing regions in both
the spring and the autumn of the same year are unprecedented.
V. Proposed Solutions
In spite of the chronic underfulfillment of ambitious plans, in
recent years Soviet leaders have consistently substituted exhortations,
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personnel changes, and administrative reorganizations for adequate in-
centives and investments needed to stimulate agricultural production.
A. Reorganization of Agricultural Administration
Following the discussions on agriculture at the Party Plenum of
January 1961, the Ministry of Agriculture, USSR -- already weakened by
the loss of its planning and procurement responsibilities, the abolition
of its MTS system in 1958, and the loss of its supply function in 1960 --
was divested of responsibility for the administration of sovkhozes, kol-
khozes, and forestry and for the repair of agricultural machinery. These
functions were scattered among several government organizations (Gosplan,
USSR; the union-republic Councils of Ministers, a new Agricultural Ma-
chinery and Supply Association, USSR; and a new State Committee for Agri-
cultural Procurement, USSR), leaving no organization clearly in charge
of agriculture. The Ministry of Agriculture, USSR, was reduced to a
research and extension service charged with the direction of agricultural
research and educational establishments.
Not only did the reorganization in 1961 fail to stimulate
agricultural production in 1961 (although it could not have been ex-
pected to assert itself to any great extent within such a short time),
but it even may have contributed to the agricultural problems of the
USSR by confusing agricultural administrators. There was evidence
of resistance and apathy toward the reorganization at both the re-
public and the local levels.
The fragmentation of the governmental administration of Soviet
agriculture resulting from the reorganization in 1961 weakened the posi-
tion of the governmental bureaucracy, or managerial class, and enhanced
the position of the Party in the administration of agriculture. The
Party Plenum of March 1962, which endorsed another reorganization of
agriculture, formalized the dominant position of the Party in the admin-
istration of Soviet agriculture. Opposition to the proposed abolition
of the grass-rotation system of farming may have been an important fac-
tor in the decision to provide a clearer delineation of administrative
responsibility and an integral role for the Party in agricultural
administration.
Under the reorganization in 1962, a national Agricultural Com-
mittee was established to supervise production and procurement of
agricultural products in the republics and oblasts (see Figure 3).*
Headed by N.G. Ignatov, a Deputy Chairman of the Council of Ministers,
USSR, this committee will include the chief of the Agricultural De-
partment for Union-Republics of the Central Committee of the Communist
* Following p. 14.
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USSR: Organization of Agricultural Administration
USSR
AGR1GUL URAL
'COMMITTEE
REPUBLIC
AGR1GULTUR L
GOMMITTEE
Ghairman-Repu lk
fttaav
OBLAST
Figure 3
AGRIGULTURAL
COMMITTEE
chairman-
Oblast
atea tigwop
Gommittee
REPUBLIC
PRODUGT1ON
6:RD
Qdlium:fittel
Republic
PROGUREMENT
Deputy
Gouncil
GOUNGIL
Director
Pitluction
Interrayon
Directorate
OBLAST
PRODUGTION
Ghairman
ca =cm
DIREGTORATE
ORD
PROGUREMENT
atmlAttel
d Oblast iglegog
Deputy
36573 9-62
INTERRAYON
&Jo:Fp
Gommittee
PRODUGTION
DIRE .TORATE,
GOLLEGT1VE
STATE
FARMS
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Party of the USSR (CPSU); the Chairman of the State Committee for Agri-
cultural Procurement, USSR; the Minister of Agriculture, USSR; the
Chairman of the Sel'khoztekhnika (Agricultural Machinery and Supply
Association), USSR; the Deputy Chairman for Agriculture of Gosplan,
USSR; and the Deputy Chairman for Agriculture of the Gosekonomsovet.
The main function of this committee will be the "organization
of operative control over the implementation of directives of the
Party and government in agriculture." Included in its more important
responsibilities will be (1) review of the plans for production and
state purchases of agricultural products, the use of those products,
and the creation of state reserves; (2) establishment of requirements
for tractors, agricultural machines, fertilizers, and building materials
and control of the fulfillment of these requirements by industry;
(3) review of plans for capital investment and construction in agri-
culture; and (4) review of the problems of long-term development of
agricultural production and procurement of agricultural products. In
effect, the committee appears to be a top-level coordinating body.
It is peculiar, however, that this committee will not be headed by a
top-ranking Party member as is true of the republic and oblast com-
mittees.
Similar and apparently subordinate Agricultural Committees are
to be constituted at the republic and oblast levels, headed by the re-
public and oblast Party first secretaries. Ministries and Directo-
rates of Production and Procurement of Agricultural Products attached
to these committees are to replace the organizations formerly en-
trusted with these responsibilities at the republic and oblast levels.
At the local level, interrayon Production Directorates for
Collective-State Farms or State-Collective Farms (the specific desig-
nation depending on which type of farming unit is predominant in the
area) are to be established to manage agricultural production and
procurement. These directorates are to be established to administer
several rayons, except where specific conditions indicate the need of
a directorate in a single rayon. The directorates have been given
broad authority in agricultural management at the local level.
A special decree of the CPSU Central Committee published in
Partiynaya zhizn' (no. 8, 1962) established within these directorates
the post of Partorg of the Obkom (Party Organizer of the Oblast Party
Committee), a post subordinate to the Obkom. Thus the Partorg will
answer directly to the oblast Party first secretary, who is both chief
of the Obkom and chief of the oblast Committee for Agriculture. The
special decree makes the Partorg the Party "watchdog" over the Pro-
duction Directorate and its subordinate kolkhozes and sovkhozes, vest-
ing the Partorg with wide-ranging responsibilities and power, perhaps
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sufficient to dominate the directorate. Khrushchev has likened the
post of Partorg to the former position of the Chief of the Politotdel
(Political Section) of the MTS. Actually the influence of the Partorg
will be broader than that of the Politotdel Chief -- the MTS served
only the kolkhoz sector but both kolkhozes and sovkhozes will be sub-
ordinate to the new interrayon directorates.
The Komsomol (Young Communist League) also has representatives
in the directorates. The role of the Komsorg (Komsomol-Organizers)
and their instructors apparently is to be minor, relative to that of
the Partorg. The main function of the Komsorg will be working with
and getting the active support of Komsomol members on the farms for
Party policies and programs.
A Council has been attached to the interrayon directorates to
lend credence to the "democratic basis" of the new organization set
up to administer the kolkhozes and sovkhozes. The director of the
interrayon directorate will head the Council, which also will include
the Partorg, the Komsorg, chairmen of kolkhozes, directors of sovkhozes,
rayon Party first secretaries, rayon executive committee chairmen, and
heads of departments of Sel'khoztekhnika. These advisory councils,
which frequently will have a hundred or more members and will meet
only four times a year, apparently will rubber-stamp the decisions of
the directorates, in much the same manner that the "democratic" kol-
khoz boards now approve the decisions of the kolkhoz chairmen.
The influence of rayon organizations in rural administration
apparently has been usurped by the interrayon directorates. Much of
the staffing of the directorates with administrative personnel and
agricultural specialists probably was achieved by drawing personnel
from the rayon executive committees. Furthermore, the staffs of the
rayon Party committees have been substantially reduced in numbers.
In the RSFSR, for example, 90 percent of the Partorgs and 40 percent
of the directors of the directorates have been recruited from the
ranks of the rayon Party first secretaries.
In summary, the reorganization of agriculture in March 1962
institutionalized Party dominance in the administration of agriculture.
Now, for the first time, the republic and oblast Party bosses have be-
come a formal part of the state administrative machinery for agri-
culture. These bosses are responsive to the ruling Party Presidium --
in fact, some of the republic Party bosses are members of the Presidium.
The reorganization, however, does not solve the basic problem
of giving more flexibility to decision-making at the farm level, which
is so necessary in agriculture. On the contrary, it appears that cen-
tralized decision-making has been strengthened. A decree published in
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Pravda on 19 April 1962, aimed at upgrading the role of the specialists
in agricultural production, may be an attempt to soft-sell publicly the
role of the Party in agriculture. There is little doubt, however, that
the Party, oriented toward national goals, will prevail, probably even
to a greater extent than in the past, over the recommendations of the
specialists.
B. Priority of Agriculture
During the "new course - new lands" period, roughly from 1954
through 1957, the Soviet consumer and agricultural sectors enjoyed a
high position in the scale of national priorities. At the Party
Plenum of January 1961, Khrushchev announced a new era of high pri-
ority for these sectors. The sincerity and urgency of Khrushchev's
current program may be tested by comparing its characteristics with
those of the "new course and new lands" programs, two programs that
unquestionably were in earnest.
Khrushchev's remarks on the subject of priority at the January
Plenum bore a striking resemblance to statements made by Malenkov when
he launched the new course program for consumer goods in August 1953.
A careful study of these two speeches reveals almost identical wording
on the subject in all but one important respect: Malenkov's program
was urgent and definite, whereas Khrushchev's was long term and vague.
Malenkov's new course speech generated a series of implemental decrees
that spelled out detailed short-run targets and specific priorities.
The resolution of the Plenum of September 1953, for example, directed
the construction materials ministries to give first priority to the
MTS system in the shipment of materials. Although recently revised
plans for rural electrification, irrigation, and allocation of equip-
ment and fertilizer seem to reflect a long-range increase in the pri-
ority of Soviet agriculture, none of the "input" decrees and resolu-
tions that have followed the Plenum of January 1961 has clearly
pegged agriculture at a higher level in the scale of immediate pri-
orities. For instance, in his opening speech at the Plenum of March
1962, Khrushchev suggested that it would be a good thing to regard
the building of three new agricultural equipment plants as priority
construction. The Plenum resolution, however, bypassed this sug-
gestion, merely noting that "it is necessary to find additional
capital" for agricultural equipment plants.
The usual quantitative indicators reflect no significant
change in the status of agriculture during 1961. Agricultural in-
vestment ("productive") increased by only about 6 percent in 1961
compared with increases of 45 percent in 1954 and 38 percent in 1955,
the beginning years of the priority new lands program (see Table 2*).
* Table 2 follows on p. 18.
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Table 2
"Productive" Capital Investments in Soviet Agriculture pj
1951-61 and 1962 Plan
Year
Million New Rubles12/
Index
Agricultural Investment
as a Percentage
of Total Investment
State
Kolkhoz 2/
Total 1/
1951
1,025
836
1,861
100
15.8
1952
971
962
1,933
104
14.6
1953
881
1,029
1,910
103
13.7
1954
1,536
1,226
2,762
148
17.0
1955
1,992
1,812
3,804
204
20.5
1956
2,118
1,906
4,024
216
18.7
1957
2,343
1,860
4,203
226
17.6
1958
2,279
2,462
4,741
255
17.3
1959
2,021
3,050
5,071
272
16.4
1960
2,471
2,721
5,192
279
15.3
1961 1/
3,000
2,500
5,500
296
N.A.
1962 Plan
3,700 5./
N.A.
N.A.
N.A.
N.A.
a. Data exclude outlays for "establishment of herds" and for capital
repair
b. In prices of 1 July 1955 adjusted to the new 1961 rate of exchange.
c. The data exclude outlays for tractors and agricultural machinery
that formerly belonged to the MTS system.
d. Although Soviet handbooks add the state and kolkhoz investment to
arrive at total investment, the two series are not strictly compatible.
State investment figures exclude outlays for forest planting, but
kolkhoz investment figures include such: outlays.
e. Total investment excludes private housing.
f. Estimated. Information is available for all (productive and nonpro-
ductive) investment for 1960 and 1961 for the state and kolkhoz sectors.
The productive investment figures for 1961 were obtained by applying the
ratio for 1960 (all investment to productive investment) to the data for
1961 for all investment.
g. Derived by increasing unrounded data for 1961 by 25 percent and
rounding to 2 significant digits.
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Allocations of trucks to agriculture, which by 1960 had fallen below
the level of 1953, apparently remained below the level of 1954-58
(see Table 3*). The share of output of trucks allocated to agri-
culture, which averaged 33 percent for the period 1954-57, is esti-
mated at 21 percent in 1961. Furthermore, only 69 percent of the
total output of tractors was allocated to agriculture in 1961 in
contrast to 74 percent for the period 1954-57, a situation that does
not reflect a high priority during 1961.** The value of output of
agricultural machinery (excluding tractors), which rose an impressive
28 percent in 1961, still fell short of the peak level of 1957.***
The plans for critical spare parts and fertilizer for 1959-61, in
terms of new capacity, were fulfilled by only 64 percent and 44 per-
cent, respectively.
The plan for 1962 suggests that state investment, scheduled
to increase by 25 percent, will do little more than keep pace with
the growth of the state sector in agriculture, which is being accom-
plished by the conversion of kolkhozes to sovkhozes. Lower input
prices, lower taxes, lower interest on state credits, and other
measures enacted during the period from January 1961 to February
1962 are expected to reduce kolkhoz expenses by about 1.35 billion
rublest annually. The sum thus released presumably would be avail-
able for such areas as investment and wages. In addition, the
procurement price increase of 1 June 1962 for kolkhoz livestock
and poultry is expected to provide more than 1 billion rubles of
* Table 3 follows on p. 20.
** In March 1962, Khrushchev noted that the agricultural equipment
park on 1 January 1962 included 790,000 trucks and 1,168,000 trac-
tors compared with requirements of 1,650,000 trucks and 2,696,000
tractors.
*XX It is significant that, for the first time in recent years,
information on the allocation of equipment to agriculture was miss-
ing from the Soviet 1961 plan fulfillment results. The above in-
formation on allocations in 1961 was indirectly derived from other
sources.
t Unless otherwise indicated, ruble values in this report are given
in new rubles established by the Soviet currency reform of 1 January
1961. A nominal rate of exchange based on the gold content of the
respective currencies is 0.90 ruble to US $1. This rate, however,
should not be interpreted as an estimate of the equivalent dollar
value of similar US goods or services.
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Table 3
Allocation of Trucks, Tractors, and Agricultural Machinery
to Soviet Agriculture
1953-61 and 1962 Plan
Trucks Tractors
Year
Thousand Units
Percent
of Total
Thousand Units
Percent
of Total
Value
of Agricultural
Machinery 12/
(Million New Rubles)
Total
Production 2/
Allocated
to Agriculture
Total
Production
Allocated
to Agriculture
1953
277
69
25
111
76
68
N.A.
1954
309
116
38
135
99
73
N.A.
1955
337
ill
33
163
123
75
540
1956
367
114
31
184
140
77
710
1957
382
125
33
204
148
73
1,000
1958
389
102
26
220
158
72
850
1959
370
76
21
214
144
68
689
1960
385
66
17
239
157
66
753
1961
406
86 2/
21 2/
264
181
69
964
1962 Plan
N.A.
100
N.A.
296
216
73
1,138
a. Including buses.
b. Production of agricultural machinery excluding trucks and tractors in prices of 1 July 1955 adjusted to
the new 1961 rate of exchange. Data for 1956-58 are estimates based on production in physical units.
c. Estimates on information for a 6-month period.
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additional kolkhoz income in 1962.* Thus the total sum of 2.35 billion
rubles accruing to the kolkhozes as a result of the financial conces-
sions and the increase in procurement prices in 1962 would equal 17 per-
cent of the total kolkhoz income of 13.6 billion rubles in 1961. Conse-
quently, capital available for investment is estimated to be 15 to 20
percent above the level in 1961. The actual level of kolkhoz investment
in 1962, however, will depend to a large extent on weather, the amount
of conversion, and the availability of equipment, fertilizer, and other
capital inputs.
Production of agricultural equipment thus far in 1962 shows an
increase in comparison with 1961, but the allocation of equipment ap-
parently will fall short of that required to meet the expanded workload
in 1962.
Production of fertilizer during 1959-61 increased at a rate far
short of that needed to meet the goal of the Seven Year Plan (see
Table )4**). The planned increase in output of fertilizer for 1962,
the midyear of the Seven Year Plan, is below the average annual increase
implied by the original Seven Year Plan directives. Production figures
for the first 6 months of 1962 suggest that even this modest plan will
not be met. Annual plans for production of fertilizer for the years
1959-62 were very modest in relation to the target for 1965, a situ-
ation which suggests that the leadership considered this target a hol-
low goal. In recent months, however, there have been signs that the
regime is becoming more earnest about the 1965 goal. For example, the
chemical industry has introduced an incentive system for workers en-
gaged in production of fertilizers and has drawn up plans for the allo-
cation of a larger share of its investment funds for the construction
of fertilizer plants. Although these measures may raise output of
fertilizer in the long run, they probably are not sufficient to over-
come the significant lag during the Seven Year Plan period.
* This sum does not include additional kolkhoz income from a rise in
prices for livestock products on the kolkhoz market. Although such a
rise is likely, there is no good basis for estimating its magnitude.
The procurement prices for kolkhoz butter and cream also were raised
on 1 June 1962. Sales of butter and cream to the state do not account
for a significant share of kolkhoz income, and the price increase for
these products was modest. Therefore, the change in the procurement
price for butter and cream should have little impact on kolkhoz income.
The prices paid to sovkhozes for livestock deliveries according to
the decree of 1 June 1962 are to be 10 percent below the prices paid to
kolkhozes.
** Table 4 follows on p. 22.
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Table 4
Production of Mineral Fertilizer in the USSR
1958-61 and 1962 and 1965 Plans
Million Metric Tons 2/
Year
Production
Actual Increase
Above Previous Year
1958
12.4
0.6
1959
12.9
0.5
1960
13.9
1.0
1961
15.3
1.4
1962 Plan
17.2
1.9
1965 Plan
Average Increase
During 1959-65
35.0W 3.2
a. Gross weight.
b. Original Seven Year Plan. Recent information suggests that
the plan has been raised to 37.7 million tons.
Clearly, Khrushchev's current program for consumers and agri-
culture lacks the initial vitality of the "new course and new lands"
projects. At the Plenum of January 1961, Khrushchev spoke of this
program as "compensation for lost opportunities." In his closing re-
marks on the requirements of agriculture delivered at the Plenum of
March 1962, he hinted that more opportunities will be lost:
It can be stated beforehand that in a few years
we shall perhaps reproach ourselves for not having
fully taken into account our possibilities for the
development of agriculture.
The Plenum failed to give agriculture the priority that Khrushchev
had asked for in his opening speech. Although it is questionable
whether or not Khrushchev will continue to fight for this priority,
the above quotation can be interpreted as both an admission of
defeat and a disclaimer of responsibility for future consequences.
In summary, when Khrushchev initiated his program for consumers
and agriculture in January 1961, he evidently believed that industrial
overfulfillment would continue to generate substantial funds throughout
the remaining years (1961-65) of the Seven Year Plan and that a large
?
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share of these funds could be invested in the consumer and agricultural
sectors. During 1961, and perhaps earlier, it became increasingly clear
that there were other demands on these funds from increased space, de-
fense, and industrial construction costs. Although Khrushchev continued
to press for his program for consumers and agriculture in his opening
speech to the Plenum of March 1962, his closing speech cautioned agricul-
tural leaders and workers not to expect the immediate transfer of funds
to agriculture to the detriment of industry and defense. The apologetic
appeal of 1 June 1962 to the population spelled this position out more
clearly. The financing of the price increase for the procurement of
livestock would fall not on defense and not on heavy industry but on the
consumer. This latest measure represents a setback to Khrushchev, who
had promised in January 1961 that industrial funds would be transferred
to the consumer and agricultural sectors and who, as early as 1958 and
as recently as March 1962, had further promised the consumer that retail
prices for agricultural products would not be raised.
C. Changes in the Cropping System
Khrushchev, deeply concerned about the lack of significant
progress in agricultural production during the first 3 years of the
Seven Year Plan but apparently unable or unwilling to obtain a high
priority for investments in agriculture, has again turned to "hidden
reserves." The main "hidden reserve" that he has discovered recently
is the land in perennial grass, oats, and clean fallow. At the 22d
Party Congress in October 1961, Khrushchev initiated a program that
eventually would eliminate the grass-rotation system of farming and
restrict the practice of clean fallowing. Following the Party Congress,
Khrushchev toured the agricultural areas of the USSR promoting his pro-
gram, and at the Party Plenum of March 1962 he firmly admonished those
opposing it. Cultivated crops -- corn, sugar beets, peas, and field
beans -- will be sown on the acreages released.
The grass-rotation, or ley, system, which was developed by the
noted Soviet agronomist, V.R. Via:yams, calls for successive periods
of sown grass and cultivated crops, with a minimum of 2 to 3 consecu-
tive years of perennial grasses and clover to be included in crop
rotations averaging 7 to 9 years in length. Clean fallowing is a
practice whereby the land is not planted for a growing season and is
cultivated only as needed to prevent growth of the weeds. The prac-
tice controls weeds and permits the accumulation of moisture in the
soil, bringing about higher and more stable crop yields.
Grasses currently occupy an important place in Soviet agri-
culture, but they are not so prevalent in the crop rotations as the
current controversy over the grass-rotation system would imply. Under
Stalin this system was indiscriminately introduced in all the agri-
cultural areas of the USSR. Following Stalin's death, however, the
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system was discarded in those areas where it was clearly not suited,
chiefly the semiarid zones. About 17 to 18 percent of Soviet sown
acreage was in perennial and annual grasses and clover in 1959, but
in the more humid Northwest these grasses and clover averaged one-
third of the sown area.
Grasses and clover serve a beneficial purpose in crop rotation
in most areas, helping to maintain the fertility and structure of the
soil while providing a cheap source of feed for livestock. Also, labor
and machinery requirements generally are much less than required for
cultivated crops. In the USSR, where a lack of fertilizers has long
handicapped agriculture, grasses and clover have contributed signifi-
cantly toward soil fertility.
Clean fallowing, although not extensively practiced in the
USSR in recent years, has been acclaimed by many Soviet scientists as
a partial answer to the low yields caused by weed infestation and fre-
quent drought in the arid new lands region. In the Canadian spring
wheat belt -- an area with physical and climatic characteristics
similar to those of the new lands -- clean fallowing has a recognized
place in increasing and stabilizing crop yields. Canadian experience
indicates that the USSR has been sowing a dangerously large proportion
of cropland to grain in the new lands. In contrast to 30 to 40 per-
cent of the cropland in clean fallow in the Canadian wheat belt, only
about 10 percent of the cultivated land in the new lands area was
fallowed in 1959. Failure to institute proper crop rotations in the
new lands has already been reflected in decreasing yields. Pressure
on local officials to produce the maximum amount of grain has produced
a vicious circle -- the area of fallow has not been increased, because
yields have been low as a result of weed infestation and depletion of
soil moisture and fertility, due in part to the inadequate area in
fallow.
Long a critic of some aspects of the grass-rotation system --
at least dating back to September 1953 -- Khrushchev was able to bring
about a significant increase in agricultural output between 1954 and
1958 through increased investments, incentives, and some changes in
the cropping system, as was true of the corn program. In those days,
however, he attacked the grass-rotation system only as being unsuited
for the more arid regions. Even as late as the discussions on agri-
culture at the Plenum of January 1961, there was little indication
that the grass-rotation system would be condemned. A strong hint that
the matter was being considered was given in Khrushchev's speech in
Alma-Ata in March 1961, when he said:
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The September (1953) Plenum of the CPSU Central
Committee condemned the stereotyped approach as re-
flected in the use of the grass-rotation system of
farming as the only one for all areas of the country.
We are now opposing a stereotyped approach ... .
Obviously, certain people have willingly accepted the
order to reject a stereotyped approach in the agri-
cultural system, but they have not yet recognized the
profound thought behind the decision of the Party and
the government criticizing the stereotyped use of the
grass-rotation system of agriculture.
Khrushchev may have postponed the attack on the grass-rotation
system beyond the spring of 1961 because of the disruptions in spring
sowing that would have occurred and because the necessary seed and
equipment were not available to carry out any extensive plowing and
seeding of grassland at that time. Strong attacks on the grass-rotation
system were not in evidence during the crop season of 1961, even when it
became evident that the 1961 crop would not come up to earlier opti-
mistic forecasts. At a general meeting of academicians and correspond-
ing members of the Lenin All-Union Academy of Agricultural Sciences
early in August 1961, M.A. 01'shanskiy, the Minister of Agriculture at
the time, whose chief responsibility was supervision of agricultural
science and research, avoided the issue of grassland altogether. It
is possible, of course, that the meeting may have been used as a sound-
ing board to determine the opposition to the radical changes to be pro-
posed by Khrushchev at the 22d Party Congress in October.
Following the Party Congress in October 1961, Khrushchev's
second tour of the major agricultural areas in 1961 and his attendance
at regional agricultural conferences appear to have been directly aimed
at propagandizing the abolition of the grass-rotation system of farming
and of overcoming the apparently significant opposition that his pro-
posal had aroused among scientists and specialists. The press campaign
waged against the grass-rotation system took on the proportions of a
major offensive, which is indicative of the degree of opposition. At the
Party Plenum of March 1962, Khrushchev stated in respect to agriculture:
The harmful effect of the ley farming system is
evident. But it cannot be said that the ley farming
advocates are abandoning their positions. They are
trying to uphold them stubbornly. In a letter from
a group of scientists of the Lithuanian Agricultural
Research Institute, they assert that grass must be the
foundation of the fodder base of stockbreeding ... .
Similar reports come from other areas.
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Khrushchev's position was upheld in a resolution of the Plenum condemn-
ing the grass-rotation system. To insure compliance with the resolu-
tion, the newly created Production Directorates have been given the
responsibility "for working out and introducing rational systems of
crop husbandry and an effective crop structure of the areas under
cultivation."
The decision to restructure the cropping system is aimed at
rapidly improving production of meat and milk by increasing the feed
supply. At the March Plenum, Khrushchev frankly admitted that "we
simply do not have enough meat," adding, "If we remain with the
present disposition of sown crops, with the present types of feed
crops, and with the present yield, we shall have no feed. There will
be no meat or milk either today or tomorrow."
In 1961, 64 million hectares (equal to 30 percent of the culti-
vated area) were in sown grass, oats, and clean fallow. Eventually,
41 million hectares* of this area will be shifted to cultivated crops --
corn, peas, field beans, and sugar beets. Eleven million hectares are
to be retained in sown grasses (alfalfa and clover), and the remaining
12 million hectares presumably will be in clean fallow and oats. In
1962, about 16 million hectares were shifted to cultivated crops, and
the area in wheat, barley, and millet was expanded by 10 million hec-
tares, leaving about 38 million hectares in sown grass, oats, and
clean fallow. The total sown area increased 11 million hectares, or
about 5 percent in comparison with 1961.
Apparently voicing the sentiments of a widespread opposition to
abandonment of the grass-rotation system, a Soviet agronomist in a let-
ter to Sel'skaya zhizn', the Soviet agricultural newspaper, pointed out
that at the present state of technology the grass-rotation system had
been serving a useful purpose in Soviet agriculture. Because of the
shortage of mineral fertilizers, cultivating machinery, harvesting
machinery, trucks, and tractors, perennial grasses and clover proved
to be the most economical crop for providing feed while at the same
time returning nitrogen to the soil. Grass rotation makes possible
a more efficient use of labor and equipment because the harvest of hay
does not coincide with that of other crops.
* During 1954-56 the new lands program increased the total sown area
in the USSR by almost 38 million hectares. The program to shift 41 mil-
lion hectares from grasses and fallow to cultivated crops will not re-
sult in a massive increase in sown area similar to that of the new lands
program, for grasses are already included in the sown area figures. The
manpower and equipment requirements of the shift in cropping pattern,
however, will be roughly similar to those of the new lands program.
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In the short run the abandonment of the grass-rotation system
and the reduction of fallow could result in a sizable increase in pro-
duction of the feed crops necessary to increase production of livestock.
The decibion to increase the area in cultivated crops in the face of
shortages of fertilizer and machinery, however, involves considerable
risk. Reducing the area of clean fallow in the new lands area would
compound the risks to agriculture in that area, where crop production
is already a hazardous venture. In the long run the program is likely
to be self-defeating as soil moisture and nutrients are exhausted.
The change has dealt a "low blow" to Soviet agricultural sci-
ence. Refutation by fiat of a system of agriculture which in some de-
gree has general acceptance throughout the world and which has been
the official basis of Soviet agriculture since the late 1930's could
well have a demoralizing effect on Soviet scientists on a scale compar-
able to that following the repudiation of classical genetics and adher-
ence to Lysenkoism.
D. Material Incentives
I should like to stress once again the exceptional
importance of the Leninist principle of material in-
centives for the cause of Communist construction ... .
It is completely erroneous to oppose material stimuli
to moral ones, material incentives to ideological-
education work ... . The development of moral stimuli
and the strengthening of material stimuli are indis-
solubly linked, mutually support each other, and are
directed towards the same goal.
These noble statements by Khrushchev at the Plenum of March 1962
apparently reflect his genuine concern for improving the material incen-
tives of the Soviet farmer. The material stimuli necessary to overcome
the inertia in the agricultural economy, however, have been prominently
lacking in recent years. The measures taken to improve the agricultural
situation following the death of Stalin included concrete proposals to
stimulate the material interest of the Soviet farmer. Procurement prices,
which had been intolerably low for most agricultural products, were
raised; tax concessions were made; monthly wage advances were encouraged;
and obligatory deliveries from private plots were decreased and then
abolished.
A decree published in March 1956 recommended that kolkhozes
make monthly cash "advances" to the collective farm members (kolkhozniki)
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in partial payment* for the work done by them on the socialized sector
of the kolkhoz during the month. Also, a sustained effort was made fol-
lowing the Party Plenum of December 1958 to get the kolkhozes to abandon
the workday (trudoden) system of labor payment, which included payment
in kind, and to go over to a "guaranteed" monthly cash wage system. The
implementation of these two measures and consequently their success in
increasing the interest of the kolkhozniki in working on the kolkhozes
were limited, probably because of the relatively poor financial status
of most farms.
Although the reform of the procurement price system in 1958 con-
tained provisions to maintain kolkhoz income in the face of adverse con-
ditions, there is little evidence to indicate that the new price system
took into consideration the full financial effects of the MTS reform on
the kolkhozes. Following the mediocre crop years of 1959 and 1960, the
heavy financial burden that was imposed on the kolkhozes by the purchase
of MTS machinery had become obvious. The increase in the money income
of the kolkhozes (as calculated in terms of current rubles per household)
averaged only 8 percent above 1958 for those 2 years.
In 1961 the regime took some measures to improve the poor finan-
cial condition of the kolkhozes. The period over which they could pay
for the machinery purchased from the MTS's was extended; prices of
trucks, tractors, gasoline, and spare parts were lowered; the tax on
annual income from animal husbandry was reduced by 80 percent through
1965; and interest on long-term state credits was lowered. It was
estimated that these measures would save the kolkhozes about 900 mil-
lion rubles annually, a part of which would be used to purchase con-
sumer goods (presumably by increasing the income of the kolkhozniki.)
Beginning in 1962, the state is to assume the transportation
costs for the delivering of products by the kolkhozes to procurement
points up to 25 kilometers (the state was already paying those costs
incurred beyond 25 kilometers). This measure reportedly will enable
the kolkhozes to save almost 200 million rubles annually. In February
1962 a price decrease, calculated to save the kolkhozes 250 million
additional rubles each year, was decreed for building materials, metal,
and metal products. Thus measures enacted in 1961 and early in 1962,
excluding the price increase of 1 June, will save the kolkhozes about
1.35 billion rubles annually, which is equal to about 11 percent of
the money income of the kolkhozes in 1961.
Certainly the most important measure taken since 1958 to stimu-
late the agricultural sector, especially animal husbandry, is the recent
* The final settlement or accounting by the kolkhoz with its members
was still made at the end of the year.
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decree that has raised the procurement prices for livestock and poultry
from kolkhozes and kolkhozniki by an average of 35 percent and for but-
ter and cream by 10 and 5 percent, respectively. Preliminary estimates
indicate that the new prices will increase the money income of the kol-
khozes by about 1 billion rubles. This increase will be a direct addi-
tion to kolkhoz income. Combined with the "savings" to be realized by
kolkhozes from the measures taken in 1961 and early in 1962, kolkhoz
income should improve by about 15 to 20 percent above that for 1961.
Although only a part of these funds will be paid out as wages, some
improvement -- probably 15 to 20 percent -- in the average wage re-
ceived by kolkhozniki should be realized. In the long run the in-
creased sums available for capital investment in the livestock sector
resulting from the increases in procurement prices should raise labor
productivity, which, presumably, will be rewarded with some increases
in remuneration to labor.
Because the new procurement prices for livestock and livestock
products will only bring the prices the kolkhozniki receive in line with
their costs of production, there seems little doubt that the usual ex-
hortations to increase labor productivity and improve the quality of
products will continue to play a significant role in attempting to
stimulate the material interest of the kolkhozniki. In 1961, added
emphasis was given to rewarding workers with part of the above-plan
production. Khrushchev recently held up as a model worker a Moldavian
corn grower who received 9 tons of corn as his of the above-plan
production. Although the exceptional earnings of some kolkhozniki are
widely propagandized, few kolkhozniki can expect similar rewards, prin-
cipally because the conditions for high labor productivity do not exist
on the majority of kolkhozes.
A new wage system intended to increase the interest of workers
on sovkhozes in the results of their work was adopted in 1961. Instead
of a fixed wage for sovkhoz workers, the new system provides that for
a requisite quantity of work the sovkhoz workers will receive a certain
part of their wage, with the remainder being dependent on the quantity
and the quality of production. The proportion of the wage that is de-
pendent on production is considerably higher for the workers engaged
in animal husbandry than for those engaged in production of crops. In
animal husbandry, as much as 80 percent of the wage can be dependent
on production, whereas in production of crops the proportion may be as
little as 20 percent.
Presumably the new wage system will mean an over-all increase
in the wages and thus the incentives of the sovkhoz workers, for 260 mil-
lion additional rubles were allocated in 1961 for the readjustment in
wages. The USSR, however, has not publicized the effectiveness of this
new wage system, suggesting that at least to date the new system has not
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produced the desired results. Any lack of success may be attributable
to the fact that with this new wage system the state for the first time
has shifted some of the hazards of crop failure from itself to the sov-
khoz workers. The introduction of the new wage system was to start in
the new lands area, and production of crops in that area was adversely
affected by drought in 1961.
VI. Prospects for 1962
A preliminary appraisal of Soviet agricultural prospects for 1962
presents a rather spotty and inconclusive picture. There is little
evidence to indicate that the priority of agriculture has been raised
enough to affect output significantly this year. The changes in agri-
cultural organization approved at the Party Plenum of March 1962 and
instituted in recent months are not likely to have an iMportant effect
on agricultural production in 1962. Implementation of Khrushchev's
recommended changes in cropping practices, however, may result in some
increase in agricultural production, but because some production was
already being obtained from the area in grass and oats and because the
increased volume of work in 1962 is likely to cause some delays in
harvesting, the net increment to production attributable to the increase
in the sown area and to the changes in the cropping patterns in 1962
probably will be no more than 5 percent under average weather conditions.
Weather during the spring of 1962 was generally favorable for field-
work. The most notable exception was the western part of the European
USSR, where weather retarded spring fieldwork. Good progress was real-
ized in other regions, however, with the result that spring planting
was completed without unusual delay even though the area planted this
spring was enlarged.
Weather conditions through July have not been particularly favorable
for production of crops in 1962. Much of the European USSR has been
plagued by damp, cold weather, which has retarded the development of
crops. At the same time, parts of the Ukraine and the North Caucasus
have been experiencing a shortage of moisture. Although the early spring
drought in the new lands was broken somewhat, many areas have been de-
ficient in moisture throughout much of the growing season. Khrush-
chev in his speech on 27 June before a conference of workers from the
Production Directorates of the Central Regions of the RSFSR was less
than optimistic. He stated that the condition of the grain crop was
satisfactory and that, barring especially unfavorable weather during
ripening and harvesting, one could assume that the harvest would be
larger than last year. He admitted, however, that there had been no
rain in parts of the Ukraine during the fall of 1961 and that part of
the winter grain area had to be reseeded because of winterkill.
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Current prospects for the Soviet livestock industry in 1962 appear
to be rather good. The number of livestock as of 1 January 1962 was
claimed to be considerably larger than a year earlier. If true, this
increase in number alone suggests an increase in output of livestock
products. Also, spring in 1962 favored the early growth of pastures.
The impetus to livestock raising provided by the large increases in
state purchase prices decreed on 1 June 1962 should be reflected in
some improvement in the performance of the Soviet livestock industry
toward the end of the year. Weather during the remainder of the grow-
ing season is vital, however, in determining the amount of livestock
feed that will be produced in 1962.
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