The profitability of agricultural production in Russia in 2018 increased to 12.5% (including subsidies) versus 12% in 2017, according to the National Report on the implementation of the state program for the development of agriculture in 2018. Profitability excluding subsidies was 6.4% versus 5.3% a year earlier, Milknews reports.
The profitability of crop production increased to 23% from 20% in 2017, livestock production decreased to 9.2% from 10.1%, products of deep processing of agricultural raw materials decreased to 7.3% from 7.9%, respectively.
The highest level of profitability in crop production (33.2%, hereinafter, excluding subsidies) was achieved in the sale of sunflower. But it turned out to be lower than in 2017, which was 42%. The most profitable livestock sector last year was pig breeding: the level of profitability of pigs without processing was 40.8% against 32.5% in the previous year.
At the same time, the report notes that the profitability target set in the state program for 2018 at 15% has not been reached. "The main reasons for the deviation of the actual value of the indicator from the planned are difficult weather conditions and cost increase due to high production costs due to rising prices of material resources and an increase in wages due to bringing the minimum wage to the subsistence minimum", the document explains. The report also notes that the industry's profit before tax (including subsidies) last year amounted to RUR 314 billion ($ 4.93 billion), which is 15.1% more than in 2017. The share of profitable farms in the total number of agricultural companies was 83%, which is 0.3 percentage points higher than a year earlier. The number of agricultural companies in 2018 decreased to 17,499 from 18,178 in 2017.
