Russia expects growth in agricultural production

The latest data suggests that agricultural production may increase by about 4% this year compared to the previous year.

2024 was not a good year: food production in Russia fell by about 3%.

However, experts expect a rebound in 2025: there is reason to believe that this figure may grow by more than 4%. Such data is provided by the forecast of the Ministry of Agriculture.

It is worth noting that the new forecast is more optimistic than the previous one, which did not expect growth, but a decrease of 0.8% in the current season.

Moreover, according to the agency’s forecasts, in the next 3 years, agricultural production in Russia may grow by 1.5-3% annually.

If the situation really developed according to this scenario, it would be a big positive for the industry.

One of the growth drivers could be the expansion of domestic production, as well as the ongoing trend towards import substitution.

Trade wars, which have already been initiated by the United States, as well as the slowdown in the global economy, directly related to them, may have a negative impact on food production in Russia.

At the same time, the fact that inflation is starting to slow down in the country may also be a positive for the development of agriculture in Russia.

If it is possible to curb price growth, the Central Bank will have grounds to lower the key rate. This will make loans more accessible to agribusiness, which are in many ways the drivers of its further development.

At the moment, it is expected that during 2025, inflation will decrease from 9.5% to at least 8.2%, and in the optimistic scenario — even to 7.6%.

It is worth noting that the agricultural sector is demonstrating impressive growth if we compare the results over a long period.

For example, the Ministry of Agriculture states that in 2025, production growth will amount to 8% compared to 2021 in comparable prices.

At the same time, the production of plant products will grow by about 15%, livestock products — by 8%.

But the profitability of production, which is vital for the survival and further development of enterprises, leaves much to be desired.

According to available information, in 2025 it will be only 15% instead of 18% in 2024.

Thus, we see that agricultural producers are receiving less and less profit. This may carry a high risk of reducing production — in this case, achieving growth targets in the coming years will become much more difficult, analysts warn.