SOVIET CAPABILITIES AND INTENTIONS: ECONOMIC: 1951 AND 1954

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP78-01617A000800290001-1
• Release Decision: RIPPUB
• Original Classification: T
• Document Page Count: 20
• Document Creation Date: December 23, 2016
• Document Release Date: January 31, 2013
• Sequence Number: 1
• Publication Date: January 20, 1950
• Content Type: MEMO

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1-------CiNTRAL INTELLYC7NCE-AGEROY
INTELLIGENCE MEMORANDUM NO. 268 25 January 1950
SUBJECT: Estimate of Soviet Capabilities and. Intentions
Economic: 1951 and 1954,
CONCLUSIONS OF STRATEGIC SIGNIFICANCE TO THE SOVIET ECONOMY
The significant economic strengths and weaknesses of the Soviet orbit
may be summarized as fellows:
10 ESEIRdita
a. The industrial capacity of the Soviet Union in 1951 and 1954 will
be considerably advanced over the prewar and the present level, and ?
agricultural production in presently Adequate for war purposes and will
exceed the prewar level in 1954.
b. Even if the Soviet orbit could be cut off entirely from outside
sources of supply, its war effort, though hampered in some degree, would
not be immediately affected in 1951. The ability of the Soviet Union to
a prolonged war in 1954 will to greatly increased.
2. ykaltnesses
wage
Although largely independent of outside sources of supply, the economy
of the Soviet Union is likely, in ths course of along war, to experience
certain shortages which might make themselves progressively more seriously
felt both in 1951 and 1954. These economic weaks-sses will perniet
through 1954. ? The most significant among them are some special types of
machine tools and production equipment, some types of electronic equipment,
special instruments, industrial diamonds, certain ferro-alloys, tin and
natural rubber, and, to a lesser extent, lack of skilled workers, transportation
facilities, and perhaps high octane combat aviation fuel.
The state of the Soviet economy in 1951 will be such that the Soviet
Union could not readily engage in a prolonged major war. However, although
its economic position will be delicately balanced in some respects in 1951.
Votet This memorandum has not been coordinated with the intelligence,
organizations of the Departments of State, Arm?. Nal?, and
the Air Force.
Document No.
CONFIDENTIAL N CHANGE in Class. rl
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IIIIIMMOMMTrr
CONFIDENTOOL
economie,factore alone would not render the Soviet Union incapable of waging
a major war effectively and on a largo ecale. should one occur in that year.
The length of time during which the Soviet economy could sustain a major war
beginning in 1951 cannot be predicted with any accuracy, but it would be
wrong to expect a rapid diminution of the Soviet war effort on purely economic
ground?.
?
SOVIET UNION AND SATELLITES
1, industrial Development,
It is the declared Soviet intention that, by the end of the fourth
Five-year Flan in 1950, industry and agriculture shall have been restored
to their prewar level and, moreover, shall have exceeded this level to a
considerable extent. It seems certain that the highest prewar output In
most essential industries will be surpassed by 1951; but agriculture is not
expected to exceed its prewar level until 1954. The satellite countries
(excluding the Soviet Zone of Germany) have in general regained their prewar
level of industrial output, Industrial development of basic Industries twill
continue to grow at a steady pace through 1954 while new industries will be
developee. as required.
2. Industrial Efficiency,
The industrial efficiency of the Soviet Union. as judged by Western
standards, will remain at a comparatively low level through 1951 because of
the shortage of skilled labor, lack of machinery and eqpipment. backward
technology, bureaucratic methods of management, industrial waste, continued
dislocation of Industry and population, and a limited transportation system.
By 1954 definite improvement will be mode and shortages removed in most
categories.
3. Industrial Manpower.
It is estimated that the total population of the Soviet Union in 1951 will
be about 202 million, and that there will be about 36.5 million workers
including those in industry, trade and transport, office workers and skilled
workers on State Farms, and in addition, an agricultural labor force of 50
million. The number of forced laborers is estimated at about 10 million and
will remain the same for 1954. While productivity per man of this group is
low, the usefulness of such a large, mobile, and cheap labor force to the
Soviet econony. especially for the development of the most inhospitable regions..
should not be discounted. However, the shortage of skilled workers will remain,
bat be less acute. The hasty attempts of the Soviet authorities to fill these
ranks may result in an output of ill-trained workers. While this situation
might be relieved in the long run, en extensive call-up of industrial workers
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to the armed forces in 1951 or in 1954 woad hamper Soviet industrial
development. The supply of professional engineers, scientists, and un-
skilled workers will be sufficient for these years. BY 1954 the population
will rise to 210 million of which 41 million will comprise non-agricultural
labor force and 48 million agricultural labor force. The population of the
Satellites for 1951 and 1954 is estimated at 93 million and 96 million; the
agricultural labor force. 23.6 million and 23.1 million; the non-agricultural.
21 million and 22.7 million. Yugoslaviaae population will grow to 16.3
million and 16.9 million; the agricultural labor force will remain about 5
minims, and the non-agricultural labor force will increase to about 2 million
for 1951 and 2.5 million in 1954. ?
4. Rey Limitations in Beeouress and Industries.
The production of petroleum products, coal, electric power, basic metals,
machine tools, electronic equipment, basic chemicals,. rubber, fertilizers,
'manpower, and transportation in the Soviet Union and Satellites is considered
in Appendix A and the extent of their adequacy for the purpose of a major war
is reviewed.
Few critical weaknesses in 1951 are revealed if the requirements of the
Soviet orbit are judged by peacetime standards, but significant limitations
emerge in that year in the light of probable war resuirmmente; namely, in
supplies of up-to-date electronic equipment, special machine tools, processing
and production equipment, some precision equipment and instruments, high
octane combat aviation fuel, natural rubber, tin, tungsten, copper, and perhaps
some ferroealloys. By 1954 increased production and stockpiling will have
narrowed the gap between production and reouirements for war purposes, but will
still leave the Soviet Union in need of some of the items listed above.
50 AFileata.41,tegThst.
The production of bread and coarse grains, meat, fats, and oils, sugar
and timber in the Soviet Union and Satellites is shown in Appendix Bn It is
considered that the Soviet orbit as a whole will be self-sufficient in food-
stuffs both in 1951 and 1954 provided that low standards of domestic and
animal consumption are continued and harvests are normal.
6. Dependence on Pereicn Sourcee for Raw Materials and Rev ManufActureSne
It is estimated that in 1951 the Soviet Union and the satellite countries
will remain dependent to a significant extent on foreign sources of supply for
natural rubber, industrial diamonds, tungsten, tin, special types of nachine
tools and production equipment, and some precisiOn instruments. They will
continue to be dependent on foreign sources for these items in /954 but to a
leeser degree because of improvements in production of the manufactured products
and of stockpiling natural products,
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7. arateeic SteekBA2414.
The Soviet Union would naturally wish to accumulate strategic stockpiles
of those raw materials in which it is deficient, and there is some evidence of
such stockpiling. However, present supplies of these commodities do not appear
to be sufficiently in excess of consumption to permit the accumulation of
more than adequate working reserves or moderate surpluses. It is certain,
however, that every effort is being made to acquire the greatest possible
quantity of uranium, and that a strategic stockpile of aluminum could be
accumulated by 1951 which would be substantially increased by 1954. By
exercising rigid economy and keeping consumption meth below reasonable peace-
time rates, stocks of certain of the more critical strategic materials, namely
natural rubber, tin, and high octane combat aviation fuel might also be made.
It is doubtful whether such stocks of these commodities as could be acquired
by 1951 would suffice for more than a short period at war rates of consumption;
but by 1954 these would be considerably augmented by increased production and
stockpiling.
8. Railways.
Transportation in the Soviet Union depends largely on railways which will
carry about 88 percent of all inland freight traffic in 1951 and 1954. The
production of track, locomotives, and rolling stock necessary for the reouired
traffic will be within Soviet capabilities, Based on Soviet utilization, new
equipment necessary for the estimated traffic in 1951 and 1954 will be less
than that produced in 1950. The Soviets will expand their electric locomotive
production and their use of electrified lines, but the production of Diesel-
electric locomotives will not increase appreciably. By 1954 the Ttans.Siberian
railroad, the sole rail connection between east and west, will have been
improved and better able to meet requirements for peacetime economy and for war.
Although all war damage to trackage has been made good and all bridges
restored, the condition of the railroads is inferior and will remain so through
1954. Despite certain improvements the railroad network is limited and poorly
aligned for the support of military operations. Moreover the gauge of Soviet
Union railways differs from that of its neighbors; consequently, all movement
across frontiers must pass through transshipment stations. The railroads will
be deficient in such qualitative factors as smooth riding roadbeds, high speeds,
passenger conveniences, and other indices whose economic raise is more
important in the US than in the Soviet Union, Despite these infirmities, the
railroads of the USSR will continue to meet the needs of apeacetime expanding
Soviet economy.
It would be impracticable, even if it were desirable, to change the
gauge of the oatellite railway systems either in 1951 or 1954. Furthermore.
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it would be undesirable to change the gauge of even a few of the main routes
since this would largely dislocate the satellite railway systems and seriously
affect the war economy of the satellite states. It would also increase the
demands on the already inadequate stocks of Soviet &vice locomotives and cars--
demands which would drew as the battle area moved further from the frontiers
of the Soviet Union,
The railway systems of the satellite countries, with the exception of
those of Czechoslovakia and Poland, are not comparable with those of Western
Europe for efficiency of operation and maintenance, and poorly organized rail-
way operation would appreciably impair a combined Soviet and satellite war
effort in Europe.
All the satellite systems are operating at near-capacity and cannot now
accommodate hesey increases in military traffic without reducing industrial .
traffic, The poor condition of satellite rail systems--particularly in Gemmuir-
will temporarily limit a combined satellite-Soviet war effort.
9. 'Motor TranePert.
Motor transport is used mainly in the USSR for short freight hauls from
farms and industrial plants to railways stations, ports, and airports. The
general level of motor transport will be slightly improved by 1951 and this
will continue, although only to a moderate extent through 1954. The strain
on the railway system will not be relieved by these improvements to any
appreciable degree, as the total inland freight turnover of motor transport
will be only about 4 percent of the total freight carried for both of these
years. IP the event of hostilities in either 1951 or 1954. therefore, road
transport systems cannot be expected to afford math relief to a somewhat over-
burdened railway system, particularly as it will be necessary Leftism on the
motor transport resources for military purposes.
Movement of freight by motor transport is being developed to a moderate
extent by the Satellites to supplement the overtamed rail system and it is
estimated that motor freight will represent 3 percent of total freight movement
in those countries in 1951 and 1954. Further utilization of motor transport
will be limited by the number of vehicles and the highway network. In the
event of hostilities the lack of adequate motor transport would impair the
operations of the satellite armed forces.
10 Civil Air Transport.
Although the volume of freight carried by Civil Air Transport is less
than 1 percent, civil air routes are of some importance to the Soviet economy0
especially in the west and eouthwest. Efforts are being made to increase still
further the alreedy considerable volume of air traffic, The disttnces involved
and the almost complete lack of developed land communications in large te.eas of
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Siberia and Central Asia make air transportation essential. The civil air
fleet provides important passenger service and emergency cargo carriage while
serving at the same time at a valuable para-military organization.
11.e,Watkigenaf map
Inland water transport is expected to handle about 8 percent of the
total inland freight. Lack of adequate shipbuilding and repair facilities,
low priority on improvements, and the freezing of rivers are some of the
handicaps to an Increase in the level of river freight turnover. However, ?
inland water transport will continue to increase in volume in 1951 and in 1954
but it will not be able to haul a larger percentage of total freight.
Shipping an the Danube. by far the most important inland waterway in
Eastern Durope. will account for a considerable quantity of Yugoslav, Bnmanian.
and'. Hungarian freight shipments and lesser amounts for Eastern Austria, Czechr,
oslovakia, and Bulgaria. Only a small proportion of Polish freight and a
considerable velem of German shipments will move on inland water transport.
The Danube is usually rendered unnavigable by ice conditions in its lower and
middle reaches from late December to mid-February. Navigation is restricted
in early spring by floods and drifting ice, and occasionally. in late summer,
by drought.
12. gmjal_112pang.
As the territories of the Soviet Union are developed, the importance of
coastal shipping routes, as a necessary adjunct to the inland waterways, rail-
ways and air transport, is growing. Energetic steps are being taken to develon
the Northern Sea Route. An extension of the period when it can be used can be
expected when larger and more powerful icebreakers have been built, but at best
its usefulness will bo limited.
Apart from a sizable coastal trade, considerable reliance is placed on
the Black Sea tanker fleet totranenort oil from the Caucasus to the Balkan
countries and Soviet ports on the north Black Sea coast. The principal impor-
tance of the Soviet merchant fleet to the Soviet Union'is for coastal and
inlond sea transpOrt. It is not engaged in overseas traffic to anything like
the extent of the merchant fleets of other maritime nations. Poland and
Finland carry on extensive overseas traffic.-
13. Strategic Significance of Transrort Capabilities.
The main strategic strength of the land and river transport systems of
the Soviet Union and satellites lies in the fact that they possess interior
connecting lines. They are net, therefore, subject to the forms of attack
which can be developed against sea tranaportation. In many respects, on the
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other hand, the Soviet and satellite transportation systems suffer from
inherent strategic weaknesses. Within the lend mass of the Soviet orbit there
is a strategic weakness in the poor transportation between east and west. The
Trans-Siberian railroad probably woad be incapable of moving the quantities
of freight which would be required in the east in the event of a major war.
This deficiency cannot be eliminated by the use of alternative land, sea, or
air routes. The Soviet Union does not control the necessary merchant vessels
to permit extensive movements of troops or supplies by ocean routes. A ,stra-
tegic weakness is the poor disbribution of land transportation. North-South
rail lines in the Balkans. for example. are too sparse by themselves to support
large movements directed at the Bosphorus or into Greece. The road network,
moreover, despite certain improvements, is sparse and poorly aligned for the
support of possible Soviet military operations. A major weakness of the Soviet
land transportation system is the problem of gauge difference vehicle has long
been a source of difficulty.
14. aergbemLSSping.
The Soviet production of merchant shipping vessels in 1951 of over
1,000 gross tune is expected to be very small. Yards are currently concentrating
on the production of river craft and auxiliary types. Small additions to
the Soviet-Satellite merchant fleets will come mainly from Poland. At the
same time. the Soviet Union Is attempting to increase its gross tonnage of
shipping.
15 Estimated Production of Selected Military Items.
It is estimated that the combined Soviet and Satellite production of
selected military items during 1951 will be as follows:
Ai Aircraft.
Production of aircraft by the Soviet Union in 1948 is considered to
have been 12,000 with a structural weight of 66.000,000 pounds. A substantial
increase in output can be achieved and it is estimated that the production will
be about 13,500 in 1951 and 18.000 in 1954. Satellite production in either
year will not be significant,
ko Armored Combat Vehicles
The Soviet Union and Czechoslovakia are the only countries expected
to produce armored vehicles during the periods considered. The Soviet Union is
expected to produce about 7,000 tanks and S.P. ems in 1951 and about 9,000 in
1954. Armored car production in the pssn in the same years will be
approximately 20 percent of theie figures. Czechoslovakian production of tanks
and 3.Pb guns, while significant, is small in comparison with the USSR.
Prodection of armored vehicles will be about 25 percent of the USSR.
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16, gsmislapia of Soviet and Allies Economic Sirenetb,
A comparison of the relative economic strengths in /951 and 1954 of the
Western Allies and the Soviet Union with its Satellites shows that the Allies
possess or hold at their disposal a great preponderance in resources and
production in practically every basic strategic commodity, a preponderance
mndh.greater than that of the Allies over the Axis powers in World War II.
Nevertheless, it is certain that current Soviet production of armaments,
particularly of military aircraft and armored combat vehicles, is considerably
greater than the present combined production of the Allies and will no doubt
continue through 1954. Moreover, standing Soviet armed forces are maintained
at far greater strength in peace than those of the Western Allies.
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Appendix A
NASIC-WSOURCES AND INDUSTRIES OF THE SOVIET UNION
ABM SATELLITES
1, Electric Power.
a. Electric power output in the Soviet Union in 1951 will be aboidt 9'
billion KWH with a capacity, of about 22.5 million KW. The USSR will ae capable of
producing annually 2.0 to 2.5 million KW of power plant ectipment. This
should meet all normal requirements and should not limit Soviet ability to
wage war.
b. In 1954 production will be increased to theta 123 billion KWH with a
capacity of about 30 million KW. Electric power plant equipment will be
produced at the annual rate of 3 million KW,
A high proportion of electric power in 1951 will continue to be
provided by a relatively few major stations, and no complete grid. ;system is expected
at this time to provide alternative supplies td main industrial areas. The
exiatence of these weaknesses is fully realized, and efforts will be made to
correct them by 1954.
A, The bulk of the electric power output of the Satellites is produced
principally by Czechoslovakia and Poland, and will be consumed by them.
2. Coal.
a. The output of coal (including brown coal) In the Soviet Union in 1951
will be about 286 million metric tons of which over 75 percent will be hard
coal. This production is an increase of over 50 percent of prewar, and
consequently Is more than sufficient to meet probable wartime consumption
reouirements, Considerable progress will continue in the mechanization of coal
production. The satellite area is expected to prcecuce as much coal as the USSR
in 1951.
. b. Production, of coal in the USSR in 1954 is estimated at 360 million
motric tons.
'c. The Satellites are likely to have an appreciable surplus of coal both
in 1951 and 19540 which could be made, to a large extent, available to meet any
increase in Soviet reetirements over and above the growing production in the
Soviet Union itself. USSR imports from the Satellites in 1951 will be 7 to 8
million tons. It is not expected this will be needed in 1954.
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3. Pqtrolem.
Indigenous crude oil production in the Soviet Union in 1951 will be
about 41 million metric tons. Satellite petroleum output is expected to
total not more than 7 million metric tons? of whici about * million metric tone
might be made callable to the Soviet Union in time of mar.
b. Indigenous production of crude oil in the USSR in 1954 is estimated
at 54 million metric tons, This will leave a purples of 4 million metric
toes whioh0 together with an (weal quantity of imports from the Satellites
and Soviet synthetic production, prove:de a surplus for stockpiling of
9 million metric tons. The Soviet Union through 1954 mill continue a policy
of vigoroua exploitation of indigenous reserves, stringent allocation of
domestidProduction, utilization of synthetic fuel and imports from the
Satellites.
c. In the event of awe: in 1951, the Soviet Union would probably be
unable, after the initial phases, to meet more than 60 percent of its full
operational requirements of high octane combat aviation fuel, but in 1954 it
is expected that the deficiency will be almost satisfied. It is estimated
further that supplies of jet fuel will be ample to meet all future
requirements of the Jet aircraft component of the Soviet and Satellite Air
Forces. In 1954, this will reduce further the needs of high octane combat
aviation gasoline. In all other aspects it can be assumed that oil shortages
would not be serious enough to impair the Soviet war economy. Those factors
which may hamper Soviet vartime production in 1951 are a shortage of
specialized equipment, such as catalytic cracking plants, alkylation and
polymerieation unite: an inadequate supply of technicians on the operational
level, and transportation bottlenecks. Those shortages will be greatly reduced
by 1954.
4. insgzess_rsastalaP I S
It is estimated that during 1951 Soviet production of iron ore, pig
iron, and steel will be as follows:
Million Metric Tons
Iron Ore?.000t, ......... *swoop 47.6
Pig Iron 23.0
Steel 28.6
These quantities are considered adequate for the Soviet DnioWs wartime needs.
Production of steel in the satellite area will probably total about 6.5 million
metric tons. Of this amount 1.6 million metric tons may be available to the
USSR. Production of steel is contingent in part on shipments of iron ore from
Sweden to Poland and Czechoslovakia. A cessaUon of those imposts might force
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? a reliance on low-grade domestic ores and bring about a reduction in output.
Coke supplies are sufficient to meet all satellite requirements and to
permit sizable exports to the Soviet Union.
A. Production for 1954 is estimated as follows:
Million Metric Tens
Iran On
65.0
Pig Iron
31.6
Steel
39.0
This should be sufficient to meet Wartime needs and to provide a surplus*
Satellite production of steel is estimated at 8.0 million metric tons of which
about 2.0 million metric tons meV be available to the USSR.
5. ierro-All vs.
.The production of fern-alloys in the Soviet Union during 1951 will
be equate for fulfilling normal industrial requirements as envisaged for
that year. The Soviet Union will have an adequate supply of nickel and
vanadium for both peace and rex =age: supplies of tungsten, however, might
.prove inadequate in war. It will have an inadequate supply of cobalt and
molybdenum, as these are partly obtained from foreign sources. In 1954, how, .
ever, the shortage of the latter two items may have been overcome by stockpiling
to the extent that the Soviet Union will be able to take advantage of technical
advances in the field of terra-alloy metallurgy. These metals are to some
extent interchangeable and wartime shortages in any one or WO of them would be
unlikely to prove a serious disability. The satellite countries produce
sufficient quantities of manganese and chrome to meet their own requirements,
but they are deficient in tungsten, nickel ? and vanadium.
6. Aluminum.
a. The aluminum production program of the Soviet Union is processing
at a far better rate than that of any other major non-ferrous metal. It le
estimated that production of?almaintem during 1951 will be about 275,000 metric
tone* which is considerably in excess of estimated consumption. Of the
Satellites, Hungary will produce about 25,000 metric tons, from which it may
provide the USSR 5,000 metric tons, although this will not be needed*
Yugoslavia is expected to produce a small amount and will require its full
production.
a. In 1954 the production of aluminum by the USSR will be increased to
about 325,000 metric tons. The production in Hungary will have been increased
to about 45,000 metric tons, of which 20,000 would be available to the USSR:
but it is highly doubtful whether it will be required. Yugoslavia will
produce about 15,000 tons, most of which is required for its own ?compere
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e. The stockpile of aluminum in 1951 will be of the order of 500,000
metric tons and -ill have been considerably increased by 1954.
7,
Ao Primary copper production of the Soviet Union during World War It
was as high as 160,000 metric tons. Since consumption exceeded 310,000 tonn
annually, large amounts had to be ipported to meet its war needo. During
1951 the Soviet copper production, including secondary metal, is estimated
at 275.000 metric tons, which is still short of World War II consumption. It
may, therefore, be expected that supplies Of copper would be inadequate to
meet full requirements in the event of war in 1951,
10, Production in the satellite countries is likely to be about 750000
metric tone in 1951. Of this amount Yugoslavia produces about two-thirds,
and it is assumed that it will be withneld. The production of the other
Satellites is barely sufficient to meet their needs.
gd, In 195k production of copper will be about 300.000 metric tons which
is hardly enough for war requirements, Satellite proauetion will be about
90.000 metric tons with Yugoslavia accounting for about 65 percent. It is
not expected that the satellites will have an exportable surplus in 19540
8.
a. It is estimated that the annual rate of tin produCtion in 1951 will
be between 9,000 and 10,000 metric tons, and it is probable that production
will be far below war needs in that year.
It. Production of tin in 1954 in the USSR is estimated to be between
10.000 and 11.000 metric tons. It will be in short supply for war purposes,
but mag be augpented to some extent by imports from China and limited stock-
piling,
SL. There. is no tin production in the 5:atellites. Some of the tin
imported by them may be available to the USSR,
9, Lead.
go Although some progress has been made since the war, Soviet production
of primary lead will still be inadequate during 1951. It is estimated that
total annual production in the Soviet Union during 1951 is expected to reach
between 100,000 and 120.000 metric tons.
b. Satellite countries may produce about 80,000 metric tons of which
Irtiesslavis is expected to produce about one half.
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p. In 19.* the production of lead in the USSR it estimated at 130,000'-
150,000 metric tons. Satellite production will be of the order of 100.000
metric tons of which Inc:meter/a will,prodees about one half.
A. In both /951 and 1954 the Soviet Union will be obliged to obtain load
from the Satellite ;to increase its supply,' unless sizable deposits are found
in he meantime.
10. 4pe.
AL. It is estimated that Soviet production in 1951 may be 120.000 -
140,000 metric tons, Total zinc production in the satellites is likely to
be about the samea
b.
In 1954 sine .production in the USSR is estimated at.140,000 - 160,000
metric tons. Satellite production will be of the order of 100,000 tons,of .
which about 75 percent will be an exportable surplus. Of the total satellite
production. Yugoslavia will account for leas than one fifth. Total availablity
of zinc, therefore, wilt be adequate for war needs.
11. MAphine Toole.
It is.estimated that the total nuMber of machine tools in the Soviet
Union in 1951 will be about 1,200,000 as coppared with about 2,000,000 in the.
United States, Qnality and individual capacity of Soviet machines are V017
muCh lower on the average than those in the United States, The Soviet Union
will be hard pressed to maintain this present, level of inventory because of
the large number of foreign-make machines, and the difficulty in obtaining
replacement parts. Tho Soviets are in dire need of special high-production
equipment and skilled labor to provide additional types of machine tools and
production machines especially for war needs, Deficiencies of machine tools
may possibly be net by imports. This is, however, unlikely,
b. By 1954 the machine tool inventory may be of the same order as in
1951. both as to number and type. This conclusion is based an the estimate
that the rate of deterioration will be balanced by production. The machine
tool production industry and inventory in the satellite nations can be expected.
to furnish the Soviet Union with some of the required machine tools at an
annually increasing rate.
12. BleqtrontaDoulamant.
A, The manufacturing capacity of the Soviet electronics industry in
1951 will be small by Western standardo, though a considerable expansion is
in progress. The aesistance of German production experts will accelerate this
expansion. In 1951, however, the electronics industry will not be capable of
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supplying normal wartime requirements of radar and communications equipment
on a scale comparable to that of the Western Powers. One of the chief menu-
facturing difficulties of the Soviet Union in thio 'branch of industry lies
In the mass production of electronic tubes for military eouipment. It is pos-
sible that considerable assistance in this technique could be provided by
Hungary. Moreover, if demands are made for new electronic equipment for guided
missiles, the provision of conventional forms of electronic equipment will
be correspondingly reduced.
It. In view of the known priorities assigned to the electronics industrY,
it may be assumed that technical know-how difficulties may have been overcome
by 1954, particularly.with the help of German, Hungarian, and other technicians.
Ecwever, in spite of this assistance output will lag owing to the scarcity
of skilled production technicians and specialized equipment of the precision
type. It is therefore not expected that they will meet their full requirements
by 1954.-
1). Minix Chemicals,
A. The basic chemical industry in the USSR has made rapid strides during
the past two decades. Sulphuric acid production in 1951 is expected to be
about 50000,000 metric tons. Of this tonnage, however, it is believed about
one half will be of suitable quality for munitions or for general industrial
use. The balance would be suitable for fertilizer production, Sulphuric acid
production in the satellite countries, exclusive of Yugoslavia, will be about
1,300,000 metric tons. Production of other basic chemicals in 1951 such as
synthetic ammonia, calcium carbide (for acetylene production) and chlorine will
be about 90000000 34000000 and 3509000 metric tone respectively.
AL. Synthetic =Ionia production in the Satellites in 1951 is estimated
to be about 550,000; Calcium carbide production 85000000 end Chlorine
300,0000 Yugoslavia's production of these three basic chemicals in re-
latively small with the exception of calcium carbide tie( will be about
150,000 tons in 1951; however, more than half of this production originates
in the Sovzone of Germany?
C., Production of basic chemicals in the USSR in 1954 is estimated to
increase to about 6.300.L001 metric tons of sulphuric acid, 1,100,000 tons of
synthetic ammonia, 400.000 to 450,000 tons of calcium carbide and 450,000 to
500,000 tons of cnlorine. Production of calcium carbide (for acetylene) and
chlorine for 1954 may be greater if the organic chemical industry, now in its
infancy and ready for expansion0fol1n US developments.
The' fertilizer production in the USSR in 1951 comprising superphosphates,
nitrogenous and potash fertilizers will total about 5.500,000 metric tons of
which about 3,100,000 will be superphosphate?. Fertilizer production in the
Satellites in 1951 will be about 4,000,000 metric tone, exclusive of Yugoslavia,
which will produce about 180,000 metric tons.
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? g, The output of basic chemicals in the .:tnitellites in 1954 is enpected to
be about 630,000 metric tone of synthetic ammonia, 950,000 tom of calcium
carbidevand 330,000 tons of chlorine; however, more than half of this production
originates in the SOVZOW of Germany. Fertilizer production will increase to
about 7,000,000 metric tons with proportional increases over 1951 production in
the individual types. Yugoslavia is not expected to increase its output to
any considerable extent over 1951.
f. ,The Soviet Union is expected to Meet all leviremente of basic chemicals
for peace and war use; particularly with imports from the Satellites, in 1951
and 1954. There may be shortages, however, with respect to special products
of the enemies' industry, particularly in 1951. These shortages may be attri-
bnted to a scarcity of some raw materials and specialized equipment which,
however, may be largely overcome in 1954.
14. Runkni.
g, Synthetic rubber production is expected to reach the yearly rate of abort
220,000 metric tons during 1951. The two chief types now being produced arc
the Divinyl and Sovpren. The GR-S type commonly made in the United States is
not being produced on alarge male in the USSR and the highly specialized
typen do not appear to have been developed. This affects; both the entput
and the quality of the product on the ussn. As would be expected, considerable a
dirficuities nave been enceentered in deiileping heavy duty tires for military
use. Consequently, there is greater dependence on natural rubber impertn nne
teed for stockpiling. Imports of natural rubber in 1951 will be about 140,000
tons from which possibly 50.000 tons per year will be available for strategic
stockpiling,
In 1954 the production of synthetic rubber is expected to reach about
260,000 metric tont with improved quality. The need for imports and stockpiling
Of natural rubber to meet minimnm requirements for war will continue through
1954.
15. Transmit Canabilitienn
Whom.
(1) Tiansportation in the Soviet Union in 1951 and 1954 will continue to
depend mainly on the railways which carry about 88 percent of all inland freight
traffic, The planned traffic goals will be achieved in 1950; and by 1951, rail
traffic will be in the magnitude of 576 billion ton-kilometers. Thereafter, .
traffic, projected on the basis of comparative indices of industrial growth
and freight traffic, will increase to about 717 billion ton-kilometers by 1954,
(2) The restoration of the war-damaged tracks has eased the shortage
of steel rails, The production of the trlack, locomotives, and rolling stock
necessary for the achievement of the renuired traffic will be within Soviet
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LAI MX! aL
capabilities. In fact, based on the Soviet utilization. the estimate of new
equipment necessary for the traffic required in 1951 and 1954 will be lees than
that produced in 1950. Tbe Soviets will expand their electric locomotive
production and their use of electrified lines, but the production.of Diesel-
electric locomotives will net Increase appreciably. By 1954 the Trans-LSiberian
railroad, the sole rail connection between east and west, will have been
improved and better able to meet requirements for peacetime economy and for war,
le Civil Air Transeorte
The Soviets will continue to maintain their Civil Air fleet at
approximately 3400 aircraft throwdl an annual production of about 355 units.
?
Ac Inlandintereavs.
- Inland water transport is expected to handle about 8 percent of the
total inland traffic. Annual increase cif inventory will approximate 600.000 horst-
power of selftprepolled craft and 600.000 tons of carrying capacity in dumb
barges, The use of river transport will be emphasized to relieve the railways
wherever possible in the carrying of bulk freights.
Coastal Shinning,
The Soviet merchant fleet in the Far East, the Black Sea, the
Baltic Sea, and the Arctic engages largely in coastal tramp operations. Lees
than 10 percent of the current fleet of 522 vessels appears in a single month
outside of Soviet waters. However, by 1954, under the stimulus of trade iith
Sakhalin, Korea, and China, traffic may Increase. The Northern Sea Route
will be able to carry more traffic in 1954,
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eCO NM ENDA
APPTEDIX B
AGRICULTURAL PRODUCTION IN THE SOVIET UNION AND TEE SATELLITES
1.
atigMe
gb The grain production of the Soviet Union Sc considered adequate?
provided harvests aro normal0 to feed the population and livestock both
in 1951 and 1954 at about the prewar level of constmptian. Net production
of all grains in 1951 ie estimated to be 88 million metric tons Whioh in
95 percent of prewar production; there will be a carry-over of 8 million
tons. Distribution is estimated as follow': 80 million tons will be
utilized, 61 percent by the population, 20 percent for livestock. 17
percent for seed and 2 percent for industrial use. Of the remaining
16 million tons, 3 millian't111 be exported? 10 million will be carried
over to the following Year. and about 3 million will be loss and waste. .
These figures do not include possible imports of grain from the Satellites,
Manchuria, and. Korea. If stockpiling of grain is to increase significant/ye
it is clear that it must be at the expense either of the conoumption level
or of exports to obtain capital eqnipment.
lip The estimated total grain production for the Satellites of about
45 million tons to expected to be sufficient to maintain the old consumption
levels in these countries and will not provide an exportable surplus.
Productionsof all grains in 1954will be about 95 million metric
tons. TO thio is to be added abeginning-of-the-7year stockpile of 11
million tons, totalling 106 million tons9 of which 91 million will be
consumed in about the oamo proportion as in 1951. The balance of 15
million, minus about 3 trillion for exports and 3 million for loss, will
leave 9 million tons for stockpiling. Satellite production for 1954%111 be
about 47 million tons and will not provide an exportable surplus.
lo Imgoslav production of 9.1 million metrie tans for 1951 ersi
9.6 million metric tone for 1954%111 provide a surplus of less than one
million tons for each of the two years.
2.
Ai. The prewar prodiction of peat of about 2.66 million tonsil all
consumed within the USSR, averaged only 17 kg. per capita, which im very
by according to Western standards. In Eastern Europe, generally0 meat
does not form a large part of the normal diet and there Sc no likelihood
of imports into the Soviet Union, except in very small quantities from
the Satellites. The production of meat in 1951 will be 3.2 million motile
tone and in 1954. 3.5 million metric tons which conforms generally with the
above pattern of requirements. Satellite production may provide only every
small surplus.
CONFIDENTIAL
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3? LaiLAWL911R..
Availability of fats and edible oil in the USSR has been low in
the postwar years. Production in 1951 is estimated at 1.6 million
metric tons, which is below prewar in terms of per capita consumption.
Soviet Union production of fats and oils in 19511 should increase to
1.8 million metric tons as a result of Increased slaughter of livestock
and increased acreages and yields of the oilseed crops. This may
on a per capita baois0 0.7 kilogram more per mum than in 1951.
Production of fats and oils in the Satellites in 1951 is estimated at
slightly above 1 million metric tens. This should increase to about
1.2 million metric tons in 1954 or oval to the prewar level. A small
exportable surplus may be available. Yugoslavia's production of fats
and oils in 1951 is expected to reach about 210,000 metric tons, i.e.
a 70 percent increase over prewar. Production in 1954 may show a slight
increase over 1951. Yugoslavians exportable surplus in 1951 and 19540
therefore, ehould somewhat exceed the prewar level.
4. &M.A.
The production of sugar available for consumption in 1951 in the
USSR is estimated at 2.2 million metric tons which compares with a prewar
average of 2.6 million metric tons. The comparison is even less favorable
on a per capita basis because of increase In population. upsa sugar
production in 1954 is estimated at 2.5 million metric tons, i.e. about
12 kilogram? per capita as compared to 11 kilograms in 1951. Sugar pro-
duction in the Satellites in 1951 is estimated at 2.8 million metric tons
which will give a surplus of 0.9 million metric tons, Satellite pro-
duction of sugar in 1954 Is expected to increase to 3.0 million metric
tons, thereby allowing a surplus of less than 1.0 million metric tons.
Yugoslavia's production of sager both in 1951 and 1954 is expected to
be approximately 170,000 metric tons. This will not provide an export-
able surplus.
5. =up
Althongh the estimated, production of 270 million cubic meters of'
timber in 1951 exceeds the prewar average of 2O$ million cubic meters, '
requirements will be heavier because of rehabilitation and reconstruction,
industrial expansion, and increased population. Timber production in
1954 nay reach 300 million cubic metere. Productibn of flab*r in the
Satellites is well above domestic requirements. The timber output in
1951 is estimated at 83 million cubic met= and may rise to 85 million
cubic metere in 1954. The surpluses could well take care of any future
Soviet demands. Estimates of Yugoslavia's Unbar production in 1951 and'
1954 are 25 million cubic meters and 23 million cubic meters respectively,
compared with 27 million cubic meters in prewar. Despite this drop, exports
may exceed prewar for the Yugoslav Government will probably seek foreign
exchange through timber sales.
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7 ,?
CENTRAL INTELLIGEME AGENCY
INTELLIGENCE MEYORANDUM NO, 268
ERRATA
29
27 February 1950
Holders of 1*-268 are requested to substitute the following for
corresponding sections b, 2111 and e of paragraph 13, "Basic chemicals," on
Pages A. - 6 and A - 7.
b. Synthetic ammonia production in the Satellites in 1951 is estimated
to be about 50,000; calcium carbide production 850,000, and chlorine
300,000. However, more than half of this production originates in the
Sovzone of Germany. Yugoslavia's production of these three basic chemicals
is relatively small with the exception of calcium carbide which will be
about 150,000 tons in 1951.
d. The fertilizer production in the USSR in 1951 comprising super-
phosphates, nitrogenous and potash fertilizers ill total about 5,500,000
metric tons of which about 3,100,000 will be superphosphates. Fertilizer
production in the Satellites in 1951 will be about 4,000,000 metric tons,
.exclusive of Yugoslavia, which will produce about 180,000 metric tons.
Fertilizer production in the USSR in 1954 will increase to about 7,000,000
metric tons with proportional increases over 1951 production in the
individual types. The Satellites (including Yugoslavia) are not expected
to increase their output of fertilizers to any considerable extent over
1951.
e. The output of basic chemicals in the Satellites in 1954 is expected ?
to be about 630,000 metric tons of synthetic ammonia, 950,000 tons of
calcium carbide, and 330,000 tons of chlorine; however, a substantial part
of this production originates in the Sovzone of Germany.
TWSWZ.
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