The Challenge of Sustainability in Agricultural Systems: Volume 1 (Lecture Notes in Networks and Systems, 205) 3030730964, 9783030730963
This book presents a multidisciplinary collection of original contributions made by the leading scholars and practitione
143 37 20MB
English Pages 927 [873] Year 2021
Contents
Defining and Researching Sustainable Agricultural Systems
The Agricultural Market of Russia: Trends and Development Priorities
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
Reference
Strategic Directions for Improving the Management System of Agro-Industrial Complex
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
The Potential of Digital Developing in Agriculture
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
The Mechanism of Integrational Interactions of Economic Subjects: Methodological Aspects
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Strategic Management of the Agro-Industrial Complex in the Territories of Rapid Socio-Economic Development and Its Methodological Support
1 Introduction
References
Sustainable Agriculture in Russia: The Role of Eco-Friendly and Organic Technologies
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Priority Areas in Agricultural Development in the Republic of Uzbekistan
1 Introduction
2 Results and Discussion
3 Conclusion
References
Regional Features of Agricultural Development in Russia
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Innovations and Perspective Technologies in the Potato and Vegetable Subcomplex of the Agro-Industrial Complex in Russia
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Reducing the Risk of Diversified Agricultural Production by Optimizing the Production Structure
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Measuring the Impact of Land Degradation on Agricultural Output: The Case of the Volgograd Region (Russia)
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Russian Regional Agri-Food Systems Facing Global Climate Challenges: Scenarios for Future Development
1 Introduction
2 Materials and Methods
3 Results and Discussion
4 Conclusion
References
Sustainable Development of the Agricultural Sector Through Innovations and Promising Technologies
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
Reference
Development of Export-Oriented Organic Agriculture Based on Bio-Intensive Technologies
1 Introduction
2 Materials and Methods
3 Conclusion
References
Spatial Development of Agricultural Production: The Evolution of Views and Scientific Approaches
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Globalization of the World Economy and Its Impact on the Development of the Russian Agricultural Sector
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Transformations in Agricultural Structures and Modifications in Agricultural Markets: Regional Aspects
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Development of Intellectual Agriculture in Modern Economic Conditions
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Green Investments as a Factor of Sustainable Economic Development
1 Introduction
2 Materials and Methods
2.1 The Researchers
2.2 Information Research Base
2.3 Methods
2.4 Aim
3 Results and Discussion
3.1 Integrated Economic Development
3.2 The Concept of Green Economy
3.3 The Interest of Agricultural Producers in Innovative Technologies
3.4 European Experience
3.5 Investment Funds by Industry
3.6 Green Investment in Russia
3.7 Green Financing
3.8 Green Bonds
3.9 Green Bond Issuers
4 Conclusion
References
Digital Transformations in the Agro-industrial Complex
1 Introduction
2 Materials and Methods
3 Results
4 Conclusion
References
Agriculture in the Digital World
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Digital Transformation in Agriculture: Goals, Tasks, and Main Development Paths
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Food Security in a Globalizing Environment
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
The Korean Experience in Implementing the Fourth Industrial Revolution: General and Agricultural Aspects
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
Reference
World and Russian Agriculture Facing Digitalization Challenges
1 Introduction
2 Materials and Methods
3 Results
3.1 The Main Features of Digitalization of the Agricultural Sector of Foreign Countries
3.2 Features of Digitalization of the Russian Agricultural Sector
4 Discussion
5 Conclusion
References
Digitalization as the Key Factor in AIC Development
1 Introduction
2 Materials and Methods
3 Results and Discussion
4 Conclusion
References
Priority Areas for Sustainable Agricultural Development: Regional Aspects
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Assessment of the Influence of Spatial Effects on the Efficiency of Agriculture in European Countries and Russia
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Key Digital Competencies Among University Students to Ensure Sustainable Development of Economic Systems
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Educational Innovation in the Digitalization of Agroindustry
1 Introduction
2 Materials and Methods
3 Results
3.1 Trends in the Development of the Agricultural Sector
3.2 New Requirements for the System of Training Specialists for the Needs of the Agroindustry
4 Discussion
5 Conclusion
References
Digitalization and Sustainable Development in the Federal Districts of Russia
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Analysis of the Management System for the Balanced Innovative Development of Agricultural Production
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Digitalization of the Agro-Industrial Complex as the Main Factor of Regional Economic Development
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Environmental Features of Hypersaline Lakes in the Regional Socio-Economic Development
1 Introduction
2 Materials and Methods
3 Results and Discussion
4 Economic Efficiency
5 Conclusion
References
Intensity of Agricultural Land Use and Land Market Activities in the Central Economic Region in Russia
1 Introduction
2 Materials and Methods
3 Results and Discussion
3.1 The intensity of agricultural land use in the CER of the CFD
3.2 Dependence of the Land Market Activity and Land Plots Price on Their Size and Location in the CER Areas of the CFD
4 Conclusion
References
Achieving Sustainable University Development Based on the EFQM Model Implementation
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Influence of Financial and Economic Factors on the Sustainable Development of Russian Agriculture
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Innovative-Based Development of the Dairy and Food Subcomplex of the Agro-Industrial Complex
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Comprehensive System Approach to the Analysis of the Financial Sustainability of the Organization
1 Introduction
2 Materials and Methods
3 Results
4 Conclusion
References
Digital Technologies for Innovative and Sustainable Development of the Agro-Industrial Complex as a Complex Socio-Economic System
1 Introduction
2 Materials and Methods
3 Conclusion
4 Results
References
Monitoring the Readiness of Agriculture for Modernization in the Digital Economy
1 Introduction
2 Materials and Methods
3 Results and Discussion
4 Conclusion
References
Agricultural Economics
The Analysis of Hedging Instruments on the Exchange Commodity Market of Ukraine
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
The Vegetable Seed Market in Russia: Incentive Proposals for Greater Development
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Developing Breeding and Seed-Breeding in Russia: Organizational, Economic, and Legal Aspects
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
VAT for Agricultural Producers: Changes, Advantages, and Disadvantages
1 Introduction
2 Materials and Methods
3 Results
4 Conclusion
References
Increasing the Efficiency of Horticulture in Russia Under Globalization of the Agricultural Economy
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Climate Change as a Global Challenge in Agricultural Economics
1 Introduction
2 Methods
3 Results
References
Production Prospects of Economic Entities in Agriculture of the Ryazan Region, Russia
1 Introduction
2 Materials and Methods
3 Results
4 Conclusions
References
Russian Fruit and Vegetable Markets and the Role of Consumer Cooperation in Their Development
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Forecasting the Volume of Beef Consumption in the Russian Market with Various Development Scenarios for Domestic Beef Cattle Breeding: Methods and Results
1 Introduction
2 Materials and Methods
3 Results and Discussion
4 Conclusion
References
Prices Formation for Agricultural Land Plots in the Central Economic Region of the Central Federal District of Russia
1 Introduction
2 Materials and Methods
3 Results and Discussion
3.1 The Assessment of the Main Pricing Factors for Agricultural Lands by Territorial Subjects of Central Economic Region
4 The Models for Market Price Formation
5 Conclusion
References
Organizational and Economic Mechanism for Grain Exchange Functioning in Russia
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Prospects of Russian Exports with Respect to the Demand for Chinese Agricultural Products
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Trends and Development of Fish-Breeding in Russia
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Pricing of Milk and Dairy Products by Manufacturers and Trade Organizations
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Development Oilseed Production Based on Assortment Expanding
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Factors for the Development of an Export-Oriented Agri-Food Market
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Sustainable Development of Pig Breeding in Russia
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Organizational and Economic Mechanism of Interaction Between Hops Producers and Consumers
1 Introduction
2 Materials and Methods
3 Discussions
4 Conclusion
References
Technical and Technological Innovations in Domestic Gardening Intensification
1 Introduction
2 Materials and Methods
3 Results
Reference
Building a Financial Security System to Ensure Russia’s Food Security
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Innovative Approaches in Financial Support for Regional Economic Security
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
The Investment Support Mechanism for Developing Internal Resources in a Regional Economy
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
The Reproduction of Fixed Assets in Agriculture
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
The Formation of Crop Insurance Tariffs with State Support in the Russia
1 Introduction
2 Materials and Methods
3 Results
4 Conclusion
References
Foreign Economic Aspects of Ensuring the Use of Labor Resources in the Krasnodar Region of Russia
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Sustainable Development Strategies for Regional Based on Innovation Potential
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Digitalization in Agroeconomics as a Means of Diffusion of Innovations
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Institutional Changes and Their Impact on Agricultural Economics in Russia in 1952–2018
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
4.1 1952–1958
4.2 1959–1970
4.3 1971–1981
4.4 1982–1990
4.5 1991–1998
4.6 1999–Present
4.7 Improving the Institutional Environment of Agriculture in Russia
5 Conclusion
References
The Social and Environmental Management Model for Sustainable Market Economy
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Transformation of Consumption Demand for Meat and Meat Products as an Important Aspect of Agricultural Development
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Developmental Prospects for Food Trade in World Markets
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Innovative Development in Agricultural Economics
1 Introduction
2 Materials and Methods
3 Results and Discussion
4 Conclusion
References
Russian Wine Production: Current Development and Future Prospects
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Accounting and Analytical Support for the Development of Foreign Trade
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Adoption and Implementation of Entrepreneurial Decisions by Small and Medium Regional Enterprises: Technological Features
1 Introduction
2 Materials and Methods
3 Results
4 Conclusion
References
Consumer Systems in Agricultural Economics: Focus on Energy Efficiency and Digital Technology
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
Reference
Calculating Economic Damage and Ecological Harm Caused by Illegal Hunting in Russia
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
The Impact of Economic Regulation Instruments on Agricultural Production in Russia
1 Introduction
2 Materials and Methods
3 Theoretical Foundation of the Study
4 Results
4.1 Prices
4.2 Governmental Support in Agriculture
4.3 Investment Activities
4.4 Tax Regulations in the Agricultural Sector
4.5 Econometric Model
5 Conclusion
References
The Paradigm of Public Non-financial Reporting as a Tool for Investment Decision Making
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Using Management Accounting Descriptors in the Analysis of Factory Beet Production Development
1 Introduction
2 Materials and Methods
3 Results and Discussion
4 Conclusion
References
Introduction of a Production Analyzer in the Meat Industry
1 Introduction
2 Materials and Methods
3 Research Results
4 Conclusion
References
The Digital Future of the Insurance Market
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
The Contribution of Hop Growing in Solving the Issues of Russian Food Security
1 Introduction
2 Materials and Methods
3 Results
4 Conclusion
Reference
Investment Attractiveness of Agriculture in Contemporary Conditions
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Marking in Russia: Staging, Trends, and Impact
1 Introduction
2 Materials and Methods
3 Results and Discussion
4 Conclusion
Reference
Rural Sustainability
The Results of an Empirical Survey of Villagers’ Satisfaction with Living Conditions
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Developing Rural Cooperation in Russia as a Strategic Priority
1 Introduction
2 Materials and Methods
3 Results and Discussion
4 Conclusion
References
The Mechanism for Sustainable Development of Rural Areas in the Republic of Kazakhstan
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
The Cooperative System of Rural Settlements as a Component and an Important Factor in the Socio-economic Development of Rural Areas
1 Introduction
2 Results
3 Discussion
4 Conclusion
References
Rural Development Policy in the United States: Imperative Elements
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Using Blockchain Technologies in Solving Social and Economic Problems in Rural Areas
1 Introduction
2 Results and Discussion
3 Conclusion
References
Social and Economic Development of Municipal Areas in the Russian Federation
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Export Potential in Rural Areas: Management Issues
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Strategies of Regional Economic and Sustainable Development: The Case of the Beekeeping Industry
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Consumer Cooperation in Addressing Rural Employment Issues
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Monitoring the Implementation of the National Healthcare Project
1 Introduction
2 Materials and Methods
3 Results
4 Conclusion
References
Critical Aspects of Developing Social Infrastructure in Rural Areas of the Stavropol Region in Russia
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Prospects for the Development of Rural Power Industry in Russia
1 Introduction
2 Materials and Methods
3 Results
4 Conclusion
References
Classification of Rural Areas Based on a Comprehensive Assessment of Their Development
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Innovative Mechanism to Increase the Efficiency of Indirect Employment of the Rural Population
1 Introduction
2 Materials and Methods
3 Results
4 Discussion
5 Conclusion
References
Correction to: The Vegetable Seed Market in Russia: Incentive Proposals for Greater Development
Correction to: Chapter “The Vegetable Seed Market in Russia: Incentive Proposals for Greater Development” in: A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_43
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Lecture Notes in Networks and Systems 205
Aleksei V. Bogoviz Editor
The Challenge of Sustainability in Agricultural Systems Volume 1
Lecture Notes in Networks and Systems Volume 205
Series Editor Janusz Kacprzyk, Systems Research Institute, Polish Academy of Sciences, Warsaw, Poland Advisory Editors Fernando Gomide, Department of Computer Engineering and Automation—DCA, School of Electrical and Computer Engineering—FEEC, University of Campinas— UNICAMP, São Paulo, Brazil Okyay Kaynak, Department of Electrical and Electronic Engineering, Bogazici University, Istanbul, Turkey Derong Liu, Department of Electrical and Computer Engineering, University of Illinois at Chicago, Chicago, USA; Institute of Automation, Chinese Academy of Sciences, Beijing, China Witold Pedrycz, Department of Electrical and Computer Engineering, University of Alberta, Alberta, Canada; Systems Research Institute, Polish Academy of Sciences, Warsaw, Poland Marios M. Polycarpou, Department of Electrical and Computer Engineering, KIOS Research Center for Intelligent Systems and Networks, University of Cyprus, Nicosia, Cyprus Imre J. Rudas, Óbuda University, Budapest, Hungary Jun Wang, Department of Computer Science, City University of Hong Kong, Kowloon, Hong Kong
The series “Lecture Notes in Networks and Systems” publishes the latest developments in Networks and Systems—quickly, informally and with high quality. Original research reported in proceedings and post-proceedings represents the core of LNNS. Volumes published in LNNS embrace all aspects and subfields of, as well as new challenges in, Networks and Systems. The series contains proceedings and edited volumes in systems and networks, spanning the areas of Cyber-Physical Systems, Autonomous Systems, Sensor Networks, Control Systems, Energy Systems, Automotive Systems, Biological Systems, Vehicular Networking and Connected Vehicles, Aerospace Systems, Automation, Manufacturing, Smart Grids, Nonlinear Systems, Power Systems, Robotics, Social Systems, Economic Systems and other. Of particular value to both the contributors and the readership are the short publication timeframe and the world-wide distribution and exposure which enable both a wide and rapid dissemination of research output. The series covers the theory, applications, and perspectives on the state of the art and future developments relevant to systems and networks, decision making, control, complex processes and related areas, as embedded in the fields of interdisciplinary and applied sciences, engineering, computer science, physics, economics, social, and life sciences, as well as the paradigms and methodologies behind them. Indexed by SCOPUS, INSPEC, WTI Frankfurt eG, zbMATH, SCImago. All books published in the series are submitted for consideration in Web of Science.
More information about this series at http://www.springer.com/series/15179
Aleksei V. Bogoviz Editor
The Challenge of Sustainability in Agricultural Systems Volume 1
123
Editor Aleksei V. Bogoviz National Research University Higher School of Economics Moscow, Russia
ISSN 2367-3370 ISSN 2367-3389 (electronic) Lecture Notes in Networks and Systems ISBN 978-3-030-73096-3 ISBN 978-3-030-73097-0 (eBook) https://doi.org/10.1007/978-3-030-73097-0 © The Editor(s) (if applicable) and The Author(s), under exclusive license to Springer Nature Switzerland AG 2021, corrected publication 2021 This work is subject to copyright. All rights are solely and exclusively licensed by the Publisher, whether the whole or part of the material is concerned, specifically the rights of translation, reprinting, reuse of illustrations, recitation, broadcasting, reproduction on microfilms or in any other physical way, and transmission or information storage and retrieval, electronic adaptation, computer software, or by similar or dissimilar methodology now known or hereafter developed. The use of general descriptive names, registered names, trademarks, service marks, etc. in this publication does not imply, even in the absence of a specific statement, that such names are exempt from the relevant protective laws and regulations and therefore free for general use. The publisher, the authors and the editors are safe to assume that the advice and information in this book are believed to be true and accurate at the date of publication. Neither the publisher nor the authors or the editors give a warranty, expressed or implied, with respect to the material contained herein or for any errors or omissions that may have been made. The publisher remains neutral with regard to jurisdictional claims in published maps and institutional affiliations. This Springer imprint is published by the registered company Springer Nature Switzerland AG The registered company address is: Gewerbestrasse 11, 6330 Cham, Switzerland
Contents
Defining and Researching Sustainable Agricultural Systems The Agricultural Market of Russia: Trends and Development Priorities . . . . . . . . . . . . . . . . . . . . . . . . . . . . Arsen A. Tilov, Valentina V. Poliakova, and Sona L. Sumbatyan
3
Strategic Directions for Improving the Management System of Agro-Industrial Complex . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Valeriy G. Shafirov, Natalia S. Serdyuk, and Evgeniy E. Mozhaev
11
The Potential of Digital Developing in Agriculture . . . . . . . . . . . . . . . . . Andrey V. Ulezko, Marina A. Zhukova, and Valery V. Reimer The Mechanism of Integrational Interactions of Economic Subjects: Methodological Aspects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Lilia O. Makarevich and Andrey V. Ulezko Strategic Management of the Agro-Industrial Complex in the Territories of Rapid Socio-Economic Development and Its Methodological Support . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Ludmila Yu. Filobokova and Alexandra Yu. Zhdankina Sustainable Agriculture in Russia: The Role of Eco-Friendly and Organic Technologies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Natalia Yu. Nesterenko, Alexander V. Kolyshkin, and Tamara V. Iakovleva Priority Areas in Agricultural Development in the Republic of Uzbekistan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Gulchexra Dj. Khalmatjanova and Muazzam S. Mannopova Regional Features of Agricultural Development in Russia . . . . . . . . . . . Lidia S. Arkhipova and Irina V. Gorokhova
17
23
33
41
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Contents
Innovations and Perspective Technologies in the Potato and Vegetable Subcomplex of the Agro-Industrial Complex in Russia . . . . . . . . . . . . . Sergey V. Zhevora, Vladimir V. Tulcheev, and Maxim Yu. Borisov
65
Reducing the Risk of Diversified Agricultural Production by Optimizing the Production Structure . . . . . . . . . . . . . . . . . . . . . . . . Marina O. Sannikova and Ekaterina A. Markelova
73
Measuring the Impact of Land Degradation on Agricultural Output: The Case of the Volgograd Region (Russia) . . . . . . . . . . . . . . . . . . . . . . Oleg A. Makarov, Nikita R. Kryuchkov, and Anton S. Strokov
85
Russian Regional Agri-Food Systems Facing Global Climate Challenges: Scenarios for Future Development . . . . . . . . . . . . . . . . . . . Stanislav O. Siptits, Irina A. Romanenko, and Natalia E. Evdokimova
95
Sustainable Development of the Agricultural Sector Through Innovations and Promising Technologies . . . . . . . . . . . . . . . . . . . . . . . . 105 Yury A. Tsypkin, Serhij L. Pakulin, and Inessa S. Feklistova Development of Export-Oriented Organic Agriculture Based on Bio-Intensive Technologies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 115 Valentina A. Kundius Spatial Development of Agricultural Production: The Evolution of Views and Scientific Approaches . . . . . . . . . . . . . . . . . . . . . . . . . . . . 121 Olga V. Solntseva and Marina L. Yashina Globalization of the World Economy and Its Impact on the Development of the Russian Agricultural Sector . . . . . . . . . . . . . 129 Galina N. Likhosherstova, Elena V. Nejelchenko, Yuliya I. Zdorovets, and Svetlana N. Yasenok Transformations in Agricultural Structures and Modifications in Agricultural Markets: Regional Aspects . . . . . . . . . . . . . . . . . . . . . . . 139 Olga G. Charykova, Vladimir F. Pechenevsky, and Tatyana N. Gogoleva Development of Intellectual Agriculture in Modern Economic Conditions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 149 Oksana G. Karataeva, Maxim I. Pekalski, and Denis I. Pekalski Green Investments as a Factor of Sustainable Economic Development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 155 Zinaida A. Mishina, Sergey N. Kozlov, Anatoly E. Shamin, Lyudmila M. Kornilova, and Marina S. Abrosimova Digital Transformations in the Agro-industrial Complex . . . . . . . . . . . . 167 Veronika V. Yankovskaya
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Agriculture in the Digital World . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 177 Ludmila N. Usenko, Aleksandr N. Tarasov, Victoria A. Guzey, Anastasia M. Usenko, and Alina S. Bidzhieva Digital Transformation in Agriculture: Goals, Tasks, and Main Development Paths . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 185 Elena A. Batishcheva, Roman V. Kron, Anna F. Dolgopolova, Ludmila A. Latysheva, and Vladimir P. Shibaev Food Security in a Globalizing Environment . . . . . . . . . . . . . . . . . . . . . 193 Lyudmila Yu. Piterskaya, Tatyana G. Gurnovich, Lyudmila A. Latysheva, Victoria V. Prokhorova, and Elena O. Goretskaya The Korean Experience in Implementing the Fourth Industrial Revolution: General and Agricultural Aspects . . . . . . . . . . . . . . . . . . . . 201 Svetlana V. Ivanova and Artyom V. Latyshov World and Russian Agriculture Facing Digitalization Challenges . . . . . 209 Svetlana V. Ivanova and Galina V. Kuznetsova Digitalization as the Key Factor in AIC Development . . . . . . . . . . . . . . 219 Irina P. Belikova, Olga M. Lisova, Abubakir H. Tambiev, Inna A. Semko, and Larisa A. Altukhova Priority Areas for Sustainable Agricultural Development: Regional Aspects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 229 Raisa I. Safiullaeva, Tatiana A. Neshchadimova, Irina A. Demchenko, Olga I. Solovieva, and Sergey V. Zolotarev Assessment of the Influence of Spatial Effects on the Efficiency of Agriculture in European Countries and Russia . . . . . . . . . . . . . . . . . 239 Stanislava R. Kontsevaya, Aleksander I. Metlyahin, Elena I. Kostyukova, Irina V. Makunina, and Daria D. Postnikova Key Digital Competencies Among University Students to Ensure Sustainable Development of Economic Systems . . . . . . . . . . . . . . . . . . . 247 Eugenia V. Taranova, Emin M. Magomadov, Olga A. Voropinova, Alina A. Vahrushina, and Tamara V. Skrebtsova Educational Innovation in the Digitalization of Agroindustry . . . . . . . . 257 Oleg P. Chekmarev, Elena V. Kovalenko, Irina G. Sudorgina, Svetlana A. Timoshenko, and Pavel M. Lukichev Digitalization and Sustainable Development in the Federal Districts of Russia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 267 Vladimir I. Trukhachev
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Analysis of the Management System for the Balanced Innovative Development of Agricultural Production . . . . . . . . . . . . . . . . . . . . . . . . 281 Oksana V. Takhumova, Nadezhda K. Vasilieva, Natalia V. Lazareva, and Tatyana P. Baranovskaya Digitalization of the Agro-Industrial Complex as the Main Factor of Regional Economic Development . . . . . . . . . . . . . . . . . . . . . . . . . . . . 289 Elena A. Bessonova, Ekaterina V. Kharchenko, and Natalia B. Chernykh Environmental Features of Hypersaline Lakes in the Regional Socio-Economic Development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 297 Svetlana V. Okrut, Vasiliy A. Komarov, Tamara G. Zelenskaya, Elena E. Stepanenko, and Victoria D. Drup Intensity of Agricultural Land Use and Land Market Activities in the Central Economic Region in Russia . . . . . . . . . . . . . . . . . . . . . . . 309 Vasiliy I. Nechaev, Galina N. Barsukova, Natalia R. Saifetdinova, Lyudmila I. Khoruzhy, and Pavel V. Mikhaylushkin Achieving Sustainable University Development Based on the EFQM Model Implementation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 319 Elena V. Khokhlova, Valentina A. Ivashova, Rahima H. Malkarova, Azamat B. Sozaev, and Tatyana N. Shcherbakova Influence of Financial and Economic Factors on the Sustainable Development of Russian Agriculture . . . . . . . . . . . . . . . . . . . . . . . . . . . 329 Igor Yu. Sklyarov, Yulia M. Sklyarova, Sergey M. Gorlov, Olga V. Mandritsa, and Galina A. Narozhnaya Innovative-Based Development of the Dairy and Food Subcomplex of the Agro-Industrial Complex . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 339 Svetlana I. Turliy Comprehensive System Approach to the Analysis of the Financial Sustainability of the Organization . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 347 Nadezhda V. Kondrashova, Larisa S. Korobeinikova, Kira N. Vasilieva, Maria V. Tkacheva, and Artem V. Krivosheev Digital Technologies for Innovative and Sustainable Development of the Agro-Industrial Complex as a Complex Socio-Economic System . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 355 Olga Yu. Antsiferova, Ekaterina V. Ivanova, Ekaterina A. Myagkova, Alexander V. Strelnikov, and Larisa M. Petrova Monitoring the Readiness of Agriculture for Modernization in the Digital Economy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 365 Inna B. Manzhosova, Sergey A. Tunin, Natalia V. Kulish, Olga E. Sytnik, and Victoria S. Germanova
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Agricultural Economics The Analysis of Hedging Instruments on the Exchange Commodity Market of Ukraine . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 379 Anna N. Slobodianyk, Nadiia P. Reznik, and George D. Abuselidze The Vegetable Seed Market in Russia: Incentive Proposals for Greater Development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 387 Vasiliy I. Nechaev, Pavel V. Mikhaylushkin, and Sergey A. Arzhantsev Developing Breeding and Seed-Breeding in Russia: Organizational, Economic, and Legal Aspects . . . . . . . . . . . . . . . . . . . . 395 Vasiliy I. Nechaev, Natalia A. Glechikova, and Aleksandr A. Seregin VAT for Agricultural Producers: Changes, Advantages, and Disadvantages . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 403 Zinaida P. Medelyaeva, Victoria B. Malitskaya, and Irina G. Zharkovskaya Increasing the Efficiency of Horticulture in Russia Under Globalization of the Agricultural Economy . . . . . . . . . . . . . . . . . . . . . . 409 Luiza A. Velibekova, Gasan D. Dogeev, and Magomed-Rasul A. Kaziev Climate Change as a Global Challenge in Agricultural Economics . . . . 417 Maxim V. Zaloilo, Natalia V. Vlasova, and Dmitriy A. Pashentsev Production Prospects of Economic Entities in Agriculture of the Ryazan Region, Russia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 423 Olga A. Bodryagina, Svetlana G. Vezlomtseva, and Olesya A. Zarubina Russian Fruit and Vegetable Markets and the Role of Consumer Cooperation in Their Development . . . . . . . . . . . . . . . . . . . . . . . . . . . . 431 Svetlana M. Ryzhkova and Valentina M. Kruchinina Forecasting the Volume of Beef Consumption in the Russian Market with Various Development Scenarios for Domestic Beef Cattle Breeding: Methods and Results . . . . . . . . . . . . . . . . . . . . . . . . . . 441 Yuri I. Bershitsky and Alexander R. Saifetdinov Prices Formation for Agricultural Land Plots in the Central Economic Region of the Central Federal District of Russia . . . . . . . . . . . . . . . . . . 451 Vasiliy I. Nechaev, Galina N. Barsukova, and Natalia R. Saifetdinova Organizational and Economic Mechanism for Grain Exchange Functioning in Russia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 461 Roman R. Araslanov Prospects of Russian Exports with Respect to the Demand for Chinese Agricultural Products . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 471 Olga V. Cherkasova, Nadezhda A. Shelamova, and Roman A. Romashkin
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Trends and Development of Fish-Breeding in Russia . . . . . . . . . . . . . . . 479 Alfiya R. Kuznetsova, Rasul U. Gusmanov, and Liana R. Saifutdinova Pricing of Milk and Dairy Products by Manufacturers and Trade Organizations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 489 Lyubov B. Vinnichek, Julia V. Reshetkina, and Olga A. Stolyarova Development Oilseed Production Based on Assortment Expanding . . . . 497 Lyubov B. Vinnichek, Elena V. Pogorelova, and Mikhail A. Khomutov Factors for the Development of an Export-Oriented Agri-Food Market . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 505 Marina E. Otinova, Elena V. Salnikova, and Aleksandr A. Tyutyunikov Sustainable Development of Pig Breeding in Russia . . . . . . . . . . . . . . . . 515 Ekaterina A. Nifontova and Elena V. Khudyakova Organizational and Economic Mechanism of Interaction Between Hops Producers and Consumers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 525 Oksana G. Karataeva, Julia V. Chutcheva, and Yuri M. Gladysh Technical and Technological Innovations in Domestic Gardening Intensification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 531 Yuliya V. Chutcheva, Dzhabir Asadov, and Emil Ibrahimov Building a Financial Security System to Ensure Russia’s Food Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 539 Irina M. Podkolzina, Alexander V. Gladilin, Konstantin Yu. Reshetov, Irina V. Taranova, and Vladimir A. Gladilin Innovative Approaches in Financial Support for Regional Economic Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 549 Irina M. Podkolzina, Irina V. Taranova, Kometa T. Paytaeva, Sergey V. Revunov, and Tatyana F. Abrosimova The Investment Support Mechanism for Developing Internal Resources in a Regional Economy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 559 Elena A. Ostapenko, Victoria V. Korosteleva, Irina V. Oseledko, Svetlana V. Belyaeva, and Dzhannet S. Shikhalieva The Reproduction of Fixed Assets in Agriculture . . . . . . . . . . . . . . . . . . 567 Lyudmila A. Latysheva, Lyudmila Yu. Piterskaya, Igor Yu. Sklyarov, Yulia M. Sklyarova, and Elena A. Batishcheva The Formation of Crop Insurance Tariffs with State Support in the Russia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 577 Vasiliy I. Nechaev, Natalia R. Saifetdinova, Lyudmila I. Khoruzhy, and Pavel V. Mikhaylushkin
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Foreign Economic Aspects of Ensuring the Use of Labor Resources in the Krasnodar Region of Russia . . . . . . . . . . . . . . . . . . . . . . . . . . . . 587 Nina V. Lipchiu, Anna A. Khramchenko, Angelina S. Kupreeva, Irina A. Nevodova, and Evgenia A. Bolotnova Sustainable Development Strategies for Regional Based on Innovation Potential . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 595 Vitaliy A. Kovshov, Zariya A. Zalilova, Milyausha T. Lukyanova, and Elsa F. Sagadeeva Digitalization in Agroeconomics as a Means of Diffusion of Innovations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 605 Alexey V. Golubev, Vasily V. Butyrin, and Nadezhda A. Smoleninova Institutional Changes and Their Impact on Agricultural Economics in Russia in 1952–2018 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 613 Rishat A. Migunov, Anastasia S. Babanskaya, Elena S. Kolomeeva, Ekaterina A. Nifontova, and Snezhanna V. Brusenko The Social and Environmental Management Model for Sustainable Market Economy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 623 Natalya N. Kovalyova, Olga N. Kuznetsova, Lyudmila V. Ermakova, Alexander F. Kovalyov, and Natalya A. Kovalyova Transformation of Consumption Demand for Meat and Meat Products as an Important Aspect of Agricultural Development . . . . . . . 633 Tatiana V. Biryukova, Nadezhda V. Surkova, Zhanna V. Konopleva, Zulfira F. Sadykova, and Tatyana I. Ashmarina Developmental Prospects for Food Trade in World Markets . . . . . . . . . 641 Arsen A. Tatuev, Natalia N. Kiseleva, Murat A. Kerefov, Semen A. Sklyarenko, and Lubov V. Zubareva Innovative Development in Agricultural Economics . . . . . . . . . . . . . . . . 649 Irina P. Belikova, Victoria V. Kurennaya, Olga N. Babkina, Dmitry V. Zaporozhets, and Natalya B. Chernobay Russian Wine Production: Current Development and Future Prospects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 657 Andrey N. Baidakov, Anton V. Nazarenko, and Alexander P. Isaenko Accounting and Analytical Support for the Development of Foreign Trade . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 665 Olga V. Elchaninova, Lyudmila G. Ripoll-Saragosi, Inna A. Poliakova, Kamilla G. Abazieva, and Svetlana N. Goncharova
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Adoption and Implementation of Entrepreneurial Decisions by Small and Medium Regional Enterprises: Technological Features . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 675 Diana S. Kenina, Olga S. Zvyagintseva, Anzhelika R. Baicherova, Olga N. Babkina, and Alexander V. Tenishchev Consumer Systems in Agricultural Economics: Focus on Energy Efficiency and Digital Technology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 687 Valery N. Karpov, Fedor D. Kosoukhov, Alexey P. Epifanov, Zarifjan Sh. Yuldashev, and Vladislav V. Kolosovsky Calculating Economic Damage and Ecological Harm Caused by Illegal Hunting in Russia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 695 Victoria D. Drup, Vladimir A. Stukalo, Tamara G. Zelenskaya, Elena E. Stepanenko, and Svetlana V. Okrut The Impact of Economic Regulation Instruments on Agricultural Production in Russia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 703 Vlada V. Maslova, Natalya F. Zaruk, and Mikhail V. Avdeev The Paradigm of Public Non-financial Reporting as a Tool for Investment Decision Making . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 715 Irina V. Alekseeva, Elena M. Evstafieva, Tatyana V. Makarenko, and Oksana N. Fedosova Using Management Accounting Descriptors in the Analysis of Factory Beet Production Development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 725 Viktor V. Govdya, Zhanna V. Degaltseva, Elena I. Kostyukova, Irina N. Khromova, and Konstantin A. Velichko Introduction of a Production Analyzer in the Meat Industry . . . . . . . . . 735 Natalya V. Sergeyeva, Ekaterina F. Malykha, Tatyana I. Ashmarina, Elena S. Ruseikina, and Vera L. Ershova The Digital Future of the Insurance Market . . . . . . . . . . . . . . . . . . . . . 743 Yuliya E. Klishina, Irina I. Glotova, Olga N. Uglitskikh, and Elena P. Tomilina The Contribution of Hop Growing in Solving the Issues of Russian Food Security . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 753 Oksana G. Karataeva, Tatyana M. Vorozheikina, Vera L. Ershova, Tatyana V. Ivleva, and Valeriy G. Tikhnenko Investment Attractiveness of Agriculture in Contemporary Conditions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 759 Alla L. Popova, Ludmila N. Kosyakova, and Nikolay N. Kosyakov Marking in Russia: Staging, Trends, and Impact . . . . . . . . . . . . . . . . . . 767 Lyubov A. Chaykovskaya, Elena I. Kostyukova, Alexandr A. Frolov, Anna V. Romanenko, and Svetlana V. Kharchenko
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Rural Sustainability The Results of an Empirical Survey of Villagers’ Satisfaction with Living Conditions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 777 Marina G. Polukhina, Elena P. Lidinfa, Olga V. Rudakova, and Svetlana V. Baranova Developing Rural Cooperation in Russia as a Strategic Priority . . . . . . 791 Dmitriy A. Pashentsev, Natalia V. Antonova, and Natalia S. Volkova The Mechanism for Sustainable Development of Rural Areas in the Republic of Kazakhstan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 797 Daniyar A. Kaldiyarov, Daniya Nurmukhankyzy, and Assel E. Bedelbayeva The Cooperative System of Rural Settlements as a Component and an Important Factor in the Socio-economic Development of Rural Areas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 805 Tatiana V. Sentereva Rural Development Policy in the United States: Imperative Elements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 813 Safarbi M. Pshikhachev and Junna S. Pshikhacheva Using Blockchain Technologies in Solving Social and Economic Problems in Rural Areas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 823 Leonid A. Gridin, Yury A. Tsypkin, and Tatiana A. Kudryashova Social and Economic Development of Municipal Areas in the Russian Federation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 831 Irina V. Shavandina, Olga V. Ilicheva, Tatyana N. Kutaeva, Anatoly E. Shamin, and Vasily A. Kozlov Export Potential in Rural Areas: Management Issues . . . . . . . . . . . . . . 845 Milyausha T. Lukyanova, Zariya A. Zalilova, Vitaliy A. Kovshov, and Fanisa F. Farrakhova Strategies of Regional Economic and Sustainable Development: The Case of the Beekeeping Industry . . . . . . . . . . . . . . . . . . . . . . . . . . . 855 Zariya A. Zalilova, Alfir G. Mannapov, Milyausha T. Lukyanova, and Vitaliy A. Kovshov Consumer Cooperation in Addressing Rural Employment Issues . . . . . 863 Liza L. Khamidova, Natalia V. Prokhorova, Gulnara K. Dzhancharova, Natalia V. Arzamastseva, and Ekaterina V. Enkina Monitoring the Implementation of the National Healthcare Project . . . . 871 Dmitry A. Endovitsky, Elena V. Endovitskaya, Sergey V. Golovin, and Andrey V. Churikov
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Critical Aspects of Developing Social Infrastructure in Rural Areas of the Stavropol Region in Russia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 879 Tatyana N. Steklova, Marina G. Lescheva, Tatyana N. Uryadova, Alexander N. Steklov, and Tatyana N. Cheprakova Prospects for the Development of Rural Power Industry in Russia . . . . 889 Oksana G. Karataeva, Nikolay N. Pulyaev, Orozmamat M. Osmonov, Yuri A. Kanatnikov, and Aleksandr V. Eshin Classification of Rural Areas Based on a Comprehensive Assessment of Their Development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 897 Olga A. Frolova, Anatolii E. Shamin, Nikolay P. Shkilev, Marina L. Nechaeva, and Ulia A. Bolshakova Innovative Mechanism to Increase the Efficiency of Indirect Employment of the Rural Population . . . . . . . . . . . . . . . . . . . . . . . . . . . 907 Maksim N. Besshaposhny, Lyudmila V. Evgrafova, Vera V. Lazar, Nikolay A. Pichuzhkin, and Andrey B. Grachev Correction to: The Vegetable Seed Market in Russia: Incentive Proposals for Greater Development . . . . . . . . . . . . . . . . . . . . Vasiliy I. Nechaev, Pavel V. Mikhaylushkin, and Sergey A. Arzhantsev
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Defining and Researching Sustainable Agricultural Systems
The Agricultural Market of Russia: Trends and Development Priorities Arsen A. Tilov , Valentina V. Poliakova , and Sona L. Sumbatyan
Abstract The paper notes the particular importance of the agricultural market for the Russian economy. The assessment of the Russian place among exporters in the world agricultural market is given. Based on the analysis of key indicators of Russian agricultural companies for 2015–2017, negative trends were identified, and a circle of problems was formulated. To reduce the influence of inhibiting factors, it is necessary to resolve issues related to production growth and increase the competitiveness of Russian agricultural products. State support for agricultural companies remains a priority direction for the next decade, having a significant positive impact on the competitiveness of agricultural production in both domestic and foreign markets. Due attention was paid to the implementation of the export strategy of agricultural products adopted in Russia until 2024. Keywords Agricultural market · Government support · Agriculture · Export · Lending
1 Introduction At the current development stage, global integration processes have become an integral part of public life, including economic, political, social, cultural, and environmental relations. Globalization is a key vector in the formation of the modern world system. It has the potential to influence the national interests of a single country. The globalization of economic relations within the industry market has become a real influential force that determines the further growth of the economy and opens up new opportunities. The global economic space provides not only conditions for the development of states but also creates common economic problems. There are opponents and supporters of globalization in the economic community, but no one denies that it affects the world order.
A. A. Tilov · V. V. Poliakova · S. L. Sumbatyan (B) State University of Management, Moscow, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_1
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Considering the world market as a set of regional or national protected markets, one can note a clear trend in the globalization of economic relations. This is especially seen in the agricultural sector, as one of the least stable and most unpredictable sectors of the world economy. Significant changes are taking place in world agricultural production, particularly the processes of intensification of agricultural production caused by breakthrough scientific and technological technologies. The success of national agricultural development programs and the coordinated actions of all participants in solving large-scale problems is a condition for the stability of the global agricultural market. Despite the uneven economic development of countries, the availability of financing for agricultural enterprises remains the main problem of the agricultural sector. A key role in creating optimal conditions for the development of farmers is assigned to the state.
2 Materials and Methods During the research, the authors used general scientific methods. The strategic priorities and directions of development of the Russian agricultural market are justified using dialectics, deduction, decomposition, economic analysis, synthesis, and economic, statistical, and strategic analysis. As a result of the work carried out according to the analytical reports on the development of the agro-industrial complex [AIC] of Russia and the financial statements of the largest companies, the current and forecasted opportunities, competitive features of the industry are identified, the development potential is assessed, the priorities and strategic development goals for the near future are substantiated.
3 Results In the last decade, the world’s agricultural market reflects steady demand and high prices for agricultural products, leading to an increase in production volume. When estimating the indicator of the volume of world agricultural production for 2013– 2017, the growth amounted to 8.3 billion tons, thereby ensuring an increase of 7%. Taking into account the forecast of the Organization for Economic Cooperation and Development [OECD], global agricultural production will slow down in the next decade, and growth will not be associated with the expansion of agricultural land, but with an increase in labor productivity, with an average annual growth rate of approximately 1.5%. Over the past decade, the Russian agricultural sector’s development has been facilitated by a general economic recovery and an increase in investment in modernizing the industry. Russian processes reflect trends to production growth of 14% in the
The Agricultural Market of Russia…
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region, including Russia as the primary producer of agricultural products (Eastern Europe and Central Asia). Agriculture should be a multifunctional, diversified, global complex that combines raw materials, finished products, and brings it to the consumer. Despite forecasts for growth in agricultural production, there will be a slowdown in global demand for agricultural products in the next decade. This trend is built based mainly on the forecast of the consumption level, which, in many countries, almost reached saturation. A modern holistic image of the agricultural market is formed with the participation of all groups of countries and regions. Russia is one of the key participants in the global market. In the ranking of the Top 5 countries in international trade in 2017, Russia is: – In the first place for wheat exports, occupying 17% of the market; – In the second place in the export of sunflower oil, occupying 14% of the market; – In the fifth place for the export of corn with a volume of 5.2 million tons. The Russian agricultural market reflects global trends marked with overproduction of food products, the development of intersectoral cooperation, a change in consumption structure, the increasing role of significant associations, and a decrease in the share of agricultural products in GDP [2]. The share of agriculture in Russia GDP decreases from 2015 to 2017, in current prices from 4.6% to 4.4%. In real prices, the share did not change compared to 2016 and amounted to 4.1% [4]. Each state needs to ensure national food security based on the results of participants in the agricultural market. In any country, agriculture is a strategically important industry and a priority area of government regulation and support. According to the SPARK system for 2015–2017, there are 22,800 large agricultural companies with an annual turnover of more than 1 million rubles in Russia. During the reviewed period, there is a gradual decrease in the industry’s operating profitability, caused by operating costs outpacing revenue growth (Fig. 1). During this period, an accelerated decline in companies’ net profit margins was accompanied by a decrease in the volume of state financial assistance (in the form of subsidies) to companies [1]. The change in key indicators of the financial activity of the largest agricultural companies is presented in Fig. 2. Specific difficulties hinder the successful functioning of companies in the Russian agricultural business. The main business problems can be grouped by the following issues: First, there remains a problematic area of agricultural engineering, in which there is a significant slowdown in the development. Nowadays, the supply of basic types of agricultural machinery in the agro-industrial sector is approximately 50% of the required technological level. In the agricultural business, the observed acute shortage of agricultural machinery is associated with low solvent demand from agricultural enterprises.
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Fig. 1 Revenue and operating expenses indicators of the largest analyzed agricultural companies. Source Developed by the authors
Fig. 2 Key financial indicators of the largest analyzed agricultural companies. Source Developed by the authors
Second, there is a need to improve agricultural production technologies and their implementation as a necessary condition for increasing labor productivity and increasing the volume of products produced. The use of obsolete technologies by agricultural producers by an average of 30% reduces labor productivity and, accordingly, increases labor costs.
The Agricultural Market of Russia…
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Third, there is a lack of investment in fixed assets. The low efficiency of agricultural production is a consequence of the high degree of physical and moral depreciation of significant production capacity. Since investing in the modernization of fixed assets is long-term, agricultural companies require “long” financial resources. In agricultural production, companies are experiencing a sharp shortage of free financial resources with relatively high capital intensity and low capital productivity against the background of temporary gaps in the implementation of costs and income. The need for financial assistance to agriculture requires specific financing instruments from the banking system. In general, all the problems are united by the lack of free financial resources of most companies in the agricultural market, which complicates the modernization of production and inhibits the growth of financial results. Currently, in Russia, the own funds of enterprises are the primary source of financing. However, their volume is not enough for quality development [3]. Forty percent of Russian companies plan to increase the number of financial resources through borrowed funds or an increase in equity. Concessional lending and subsidies under programs of the AIC state support remain relevant. To activate the investment component in the AIC, the Russian government developed several measures for stimulating the investment activities of companies, primarily aimed at supporting concessional and investment lending, as well as compensating for the incurred direct costs associated with the construction and modernization of fixed assets. To support concessional lending at banks authorized by the Ministry of Agriculture of the Russian Federation, 9.1 billion rubles were allocated at the federal level in 2017. The amount was increased to 49.1 billion rubles in 2018, and 56.1 billion rubles were allocated in 2019. In the case of soft loans, agricultural companies do not divert their working capital to pay a subsidized share of interest payments, as the reimbursement of lost profits to commercial banks over 5% is made directly from the federal budget, and not through the mechanism of subsidy return [6]. In 2017, 58.4 billion rubles were allocated from the federal budget to support Russia’s investment lending to constituent entities. In 2018, the amount was slightly lower (52.2 billion rubles). However, in 2019, the number was slightly increased to 55.5 billion rubles. In 2017, the Ministry of Agriculture of the Russian Federation selected 192 investment projects, where financing was carried out through compensation for the direct costs incurred associated with the construction and modernization of fixed assets. In 2017, the federal budget allocated 15.5 billion rubles for this type of support; in 2018 and 2019, the funding was reduced to 11.2 and 10.9 billion rubles. While trying to solve the problem of the availability of agricultural machinery to manufacturers selling their products at a discount, the federal budget provides subsidies, which volume, in 2017, amounted to 15.7 billion rubles (41% more compared to 2016). However, the growth did not continue, since, in 2018, only 10 billion rubles were given to this type of subsidy, and, in 2019, the amount of allocated funds was only 2 billion rubles.
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If sufficient investment in the industry is secured, Russia will be able to strengthen its position in the global agrarian market and realize the strategic goals set by the Ministry of Agriculture.
4 Discussion The issue of choosing the development direction of the Russian agricultural market is relevant and resolved, since, with the introduction of the food embargo in Russia, in 2014, the industry reoriented from import substitution to a new strategic task – doubling exports and reaching the amount of $45 billion by 2024. The implementation plan for the task was approved in 2018 as part of the national project “Export of agricultural products.” To intensify the activities of agro-industrial companies on the foreign market, a law on organic agriculture was adopted in 2018. The current state program for the development of agriculture, adopted in 2013, has been extended until 2025. It includes federal projects for the development of agricultural exports, digitalization of agriculture, and a system of support for farmers and agricultural cooperation. It is planned to allocate 406.8 billion rubles for the project “Export of agricultural products” by 2024. In 2019, about 50 corporate programs of international competitiveness that will allow developing export infrastructure, eliminating trade barriers, and improving product quality, are being developed [5]. For the Ministry of Agriculture of the Russian Federation, it is necessary not only to increase exports but to restructure the export structure, which will be based on the features of consumption in foreign markets and an increase in the share of finished products. Since 2020, the Ministry of Agriculture of the Russian Federation has been planning to introduce an adjustment to the unified subsidy aimed at taking into account regional features. In general, more than 2.5 trillion rubles will be allocated for financing the state program from 2019 to 2025, including 2.3 trillion rubles from the federal budget. Achieving the agricultural market’s positive planned trends is hindered by negative aspects that are not resolved nowadays. These include difficulties with domestic demand, rising costs, inaccessibility of long-term credit resources for producers, problems of infrastructure and the logistics system, increasing tax and administrative burden, the impact of sanctions, and political risks. Increasing exports of agricultural products and increasing the domestic agricultural market’s stability will become a catalyst for positive changes in the agricultural sector and related sectors (agricultural chemistry, mechanical engineering, food processing, etc.).
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5 Conclusion Summing up, we can confidently say that the agricultural market, supported by the state in recent years, contributing to the Russian economy’s growth, began to experience difficulties. Recent years showed that the industry is still heavily dependent on state support, new technologies are being slowly introduced, and the largest agro-industrial companies are losing profitability. However, the ongoing initiatives and current trends allow us to expect that this is a temporary phenomenon. The inclusion of new mechanisms will allow the agricultural market to regain its leading position in the country’s economy and increase its place in the world ratings of exporting countries.
Reference 1. Center for expert evaluation of the effectiveness of activities in the field of agriculture (2019) Report on the financial and economic condition of agricultural producers. https://www.cspapk. ru/otchetnost/ 2. Deloitte Research Center in the CIS. Overview of the agricultural market (2018) Moscow, Russia. https://www2.deloitte.com/content/dam/Deloitte/ru/Documents/research-center/obzorrynka-selskogo-hozyajstva.pdf 3. Dolgushkin NK (2016) On the need to determine strategic priorities in the development of agribusiness. Agric Econ Russ 6:11–18 4. Federal State Statistics Service (n.d.) Official website. https://www.gks.ru/ 5. Government of the Russian Federation. State program for the development of agriculture and regulation of agricultural products, raw materials, and food markets for 2013–2020 (2017). https://programs.gov.ru/Portal/programs/passport/25 6. Ministry of Agriculture of the Russian Federation (2017) Federal project “Export of agricultural products.” Ministry of Agriculture of the Russian Federation, Moscow, Russia. https://mcx.ru/ministry/departments/departament-informatsionnoy-politiki-i-spetsialn ykh-proektov/industry-information/info-federalnyi-proekt-eksport/
Strategic Directions for Improving the Management System of Agro-Industrial Complex Valeriy G. Shafirov , Natalia S. Serdyuk , and Evgeniy E. Mozhaev
Abstract The issues of improving the agro-industrial complex’s management system are critical in the context of the implementation of the import substitution strategy, the development of export-oriented agro-industrial production, and organic agriculture. Improving the management system of regional agribusiness is one of the main elements of the entire management system in the industry. Efficient agricultural production is possible with a rational combination of the development of innovative technologies, taking into account natural and climatic factors, logistics, measures of government support, production and marketing cooperation, and other factors. In the proposed model of managing regional agribusiness on state regulation principles, the priority is given to state bodies, which allow us, in current conditions, to establish intersectoral and interregional ties. Keywords Agro-industrial complex · Economy · Management system · Efficiency
1 Introduction A balanced and well-thought-out strategy of Russia’s socio-economic development allowed avoiding the economic cataclysms of the global economic crisis, maintaining stability in the economy, and continuing targeted activities to improve the quality and standard of living of citizens [8]. However, the global economic and geopolitical processes taking place in the world pose new challenges and require an adequate and timely response. This is due to global trends in globalization and the international division of labor, and the processes taking place in Russia’s agricultural sector. Food security is the most vulnerable area of Russia’s national economy in economic, social, and technological terms since food security is the urgent daily need of the country’s population.
V. G. Shafirov · N. S. Serdyuk · E. E. Mozhaev (B) Russian Academy of Personnel Support of Agro-Industrial Complex, Moscow, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_2
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The national priority project and the State program had a positive impact on the development of agriculture. However, nowadays, for the further development of agrifood policy, taking into account the trends and prospects of agricultural production, it is necessary to make adjustments to strategic priorities and increase the efficiency of agricultural management institutions. These measures should contribute to the innovative development of agriculture, increase the country’s provision with food of own production, and reduce technological and commodity dependence on foreign countries.
2 Materials and Methods The information sources of the research were the data of the Federal State Statistics Service and the Ministry of Agriculture of Russia, the results of opinion polls, and personal observations of the authors. The work of domestic and foreign researchers on improving the system of agricultural management is the theoretical and methodological basis of the paper. The study used analytical, abstract-logical, and expert methods of research, as well as the method of sociological research.
3 Results The agro-industrial complex [AIC] is a multi-level, multi-link, diversified, and multidirectional economic system. From a functional, economic point of view, it is possible to distinguish macro-, meso-, and microeconomic levels of the agroindustrial complex. The macro-level reflects the ongoing process of a decline in the agro-industrial complex and, recently, some beginnings of its revival. The mesoscale level involves the interaction of industries and regions. The micro-level reflects the functioning of such economic entities as agricultural enterprises, private household plots, farms, and market agents. Between the functional levels (macro, meso, and micro), there exist powerful multidirectional ascending and descending bonds. The management of the AIC and its economic bloc cannot be imagined without the interconnection of the above levels. This connection is most pronounced during the change in socio-economic formation when the economy of a stable stage of development passes into an impulse mode, and one can observe how changes at one level of the economy affect the functioning of other levels. Thus, the destruction of the wage system at the macro level led to the forced development of private household plots, the transition of the majority of the rural population to self-sufficiency (to the micro-level). A distinctive feature of the AIC as an economic system is its social orientation. When considering the functioning of the AIC in the institutional aspect, such institutions as a hierarchy, integration, cooperation, etc. should be taken into account.
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Therefore, the destruction change of at least one institution affects the entire economic structure of the AIC. Given the agro-industrial complex’s exposure to the influence of external factors, it requires focused, coordinated work at all levels of management, the consolidation of norms and rules. In this regard, the state’s role in ensuring inter-level, inter-sectoral, and inter-regional relations should be strengthened. However, the state’s role in determining the social rules of relations at the macro level is not manifested [2]. In different periods, the leading role in determining the leading factors of economic development belongs, as a rule, to one of the levels. Currently, it is microeconomic, i.e., the functioning of the subjects of the agri-food market in the form of enterprises and other institutions. However, the liberal development path of the agricultural sector led to significant losses in agriculture. The economic and institutional ties of agricultural enterprises with other organizations and market entities were destroyed [1]. Under these conditions, competition between them is not conducted on the commodity market, not in improving product quality or reducing costs, but for raising funds, primarily budget subventions, grants, and subsidies at the municipal, regional, and federal levels. Currently, the agricultural sector is experiencing economic difficulties. Despite some stabilization in the production of agricultural products (grain and dairy subcomplexes), crisis phenomena have not been overcome [7]. Three primary tasks of agriculture should be distinguished: • Increasing the financial sustainability of agricultural enterprises; • Ensuring food security (implementation of the import substitution program and ensuring the recommended rational norms of food consumption that meet the modern requirements of healthy nutrition); • The creation of a favorable economic climate in the agricultural sector. The organizational and economic mechanism for managing the regional AIC is one of the main elements of the entire system for managing the AIC. Its task is to establish the optimal ratios and connections of the production elements of the vertical and structural horizontal. The functioning of these elements of the regional agribusiness management system is based on the interconnection of integration and cooperation, information systems, price and financial-credit instruments, state regulations, and investments. In the proposed model of managing regional agribusiness on state regulation principles, the priority role belongs to state bodies, which allows us to establish intersectoral and interregional ties in modern conditions. When considering state support issues, such specific features of agricultural production as mechanisms, factors, and conditions should be taken into account. The need to take these features into account leads to the conclusion that the effective activity of agro-industrial groups may be due to the existing relationships between agricultural enterprises and municipal and regional bodies managing the AIC. In the absence of such contacts, agricultural producers and food industry enterprises are unlikely to find integration partners, as commercial banks are extremely reluctant to go into agribusiness without the support and guarantees of the state.
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4 Discussion The organizational and economic mechanism for managing a regional AIC requires a systematic approach in resolving issues of targeted programs involving both centralized budgetary funds and private financial sources in the AIC [6]. In this case, the optimal form of agricultural management at the regional level is the mixed management scheme, which provides for the improvement of the economic mechanism, intraeconomic, and intra-industry economic relations. Its goal is to create an economic environment that ensures the efficient operation of all sectors and enterprises of the AIC, regardless of the form of ownership [4]. The formation of effective management models is of particular importance in increasing the competitiveness of agricultural enterprises. In this management scheme, the determining forms are inter-farm cooperation and agro-industrial integration, which should be supported by regional and municipal governments. Integrated formations should develop in the direction of improving food chains according to the scheme: production—processing—sale of agricultural products. In the formation of organizational and production structures at the district level, based on the regional department of agriculture, it is advisable to create an association of agricultural, industrial, and commercial enterprises, regional business support centers, consumer cooperative organizations, and credit cooperatives [3, 5]. The work plan of these associations should include the management of all subjects of the agricultural market of the district, which, first of all, would include: • The development of perspective schemes of integration of agricultural enterprises of the district; • The identification of channels for possible investment and budget support; • The formation of the mechanism of economic relations between enterprises of the AIC of the region, including within the framework of integration relations; • The creation of a database of information resources and the legal field.
5 Conclusion Taking the above into account, it is legitimate to conclude that the development of the system for managing agribusiness should be accompanied by a transition to effective management models at the levels of the management hierarchy: federal, district, regional, and municipal. As a result of the analysis, we have proposed the following algorithm for modeling management systems: a)
The formulation of goals taking into account the strategic management function, which consists in achieving food independence, physical and economic affordability of food, food safety, and creating favorable conditions for production and living in rural areas;
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b) c)
d)
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The creation of an effective agribusiness management structure, including both traditional market structures and innovative development of agribusiness; The improvement of the institutional and regulatory framework for the functioning of the agro-industrial complex, as well as introducing an improved management mechanism, developing a system of relations (administrative, financial, industrial, marketing, logistics, etc.) of subjects and objects of management, taking into account various factors); The development, implementation, and improvement of the development model of the agricultural management system.
When developing effective agricultural management models, it is necessary to take into account the main factors: natural-climatic, logistics, measures of government support, the state and prospects of development of production and marketing cooperation, the specifics of the territory (country, federal district, subject, municipal formation), the quality of management, demographic and personnel situation, human potential, personnel qualifications, interest and ability of management entities to change, financial and economic, material and technical, infrastructural, geographical, etc.
References 1. Gokhberg L (2013) The national innovation system of Russia in the context of the “new economy.” Econ Issues 3:26–38 2. Makovetsky V, Priemko V (2011) Monitoring of information support for agricultural producers. AIC Econ Manage 1:71–75 3. Minakov IA (2015) Economics of agribusiness sectors. Kolos-S, Moscow, Russia 4. Mukhamedzhanov ER (2011) Consulting support for the innovative development of the agroindustrial complex of Russia. Oil Gas Bus 1:66–68 5. Muromtsev CB, Stashevskaya IA (2018) Strategic management of agribusiness. In: Collection of scientific papers, Krasnodar, Russia: KRIA, vol 9 6. Nechaev V, Polutina T, Zemlyanykh E (2010) Scientific information cluster in the agricultural complex of Krasnodar Oblast. AIC Econ Manage 10:23–29 7. Rabinovich LM (2018) The regulatory framework for economic incentives. Rosagropromizdat, Moscow, Russia 8. Verenikin AO, Voloshin DI (2014) Economic growth and the vector of development of modern Russia. Bull Moscow Univ Econ 2:86–99
The Potential of Digital Developing in Agriculture Andrey V. Ulezko , Marina A. Zhukova , and Valery V. Reimer
Abstract The task of forming the conditions for the digital transformation of economic systems and their digital development capacity is related to the competence of strategic management. A digital development capacity of the agricultural industry is defined by the quality of the institutional environment, macroeconomic conditions, and the level of agricultural digitalization. The digitalization of the agricultural industry is lagging behind all other branches of the economy. Currently, digital transformations in the agricultural industry are spatially non-uniform. The overall low level of agricultural digitalization produces the need to invest in digital technologies and increase the competitiveness of economic subjects by introducing digital innovations. In this study, we researched the basic problems that restrict the digital transformations in the agricultural industry and separated them into four groups, reflecting the sectoral and territorial specifics of the agricultural industry and digital re-equipment. Keywords Digital economy · Digital development · Digital transformation · Agricultural industry
1 Introduction The external environment influences the evolution of social and economic systems. Institutional and macroeconomic conditions determine the directions and speed of this evolution. Digital transformation, as a stage of production evolution, formed during the informatization of public life and the integration of information technologies in the public production system. Because of the high rate of scientific and technological development, the transition to the digital economy became inevitable. The
A. V. Ulezko (B) · M. A. Zhukova Voronezh State Agricultural University, Voronezh, Russia V. V. Reimer Far Eastern State Agricultural University, Blagoveshchensk, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_3
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tasks of implementing the digital economy became a top-priority national objective [1–3, 5, 9, 10]. We must pay special attention to accelerating the development of not only infrastructural provision but also information and communication technologies. This includes forming effective mechanisms of implementing digital technologies, creating digital ecosystems, and providing digital development in economic systems. Therefore, studies on the identification and systematization of the possible roadblocks to the digital development of the agricultural industry are extremely relevant.
2 Materials and Methods The methodological basis of this study is formed by the methods of synthesis and analysis, applied to the scientific approaches of researching the digital development of the agricultural industry. In this study, we aim to identify and systematize the problems that restrict the potential digital development of the agricultural industry.
3 Results In analyzing the institutional environment and macroeconomic conditions, we identified a range of problems that agricultural enterprises face during digitalization. These problems relate to: • Lack of strategies for the digital development of social production sectors; • The critically low level of development of the Russian digital economy; • The significant difference between the digitalization level of the branches of public production; • Low digitalization of management and production processes; • Absence of standard digital platforms that would allow for faster digitalization of business entities according to business specifics; • Fragmentary nature of information resources; • Low amount of digital interaction between economic subjects; • The discrepancy between the training of IT-workers and citizens and the needs of digital technologies. Without solving these problems, systematic digital transformations are impossible. The usage of the state funds allocated by the National Program “Digital Economy of the Russian Federation” may be ineffective. This discredits the impact of digital transformation in the modernization of public production and improving the quality of life. Digital transformations in agriculture are not widespread [6–8, 11, 14]. This branch of the economy is the least digitalized due to several reasons:
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• High ratio of small-scale agricultural enterprises. These enterprises have extremely limited funds and are somewhat conservative in adopting new technologies; • Low production density. This lowers the efficiency of IT-solutions, which, in turn, causes doubts in the process of digitalization itself; • Lack of skills and experience in using IT-technologies among the employees of agricultural enterprises; • Unequal use of innovations by different agricultural enterprises. This is caused by the low demand for new technologies among agricultural producers and the low innovative potential of agricultural science in Russia; • Lack of effective complexes for solving the managerial and technologic objectives of agricultural production; • Low information infrastructure and the limited possible use of modern telecommunication technologies in the agricultural environment; • The inefficiency of the existing network of information consulting services, which have a weak influence on the processes of digitalization in agricultural production
4 Discussion Presently, digital transformations in agriculture are extremely limited in their spread. Their use is unequal among the territorial entities, types of agricultural enterprises, and branches of agricultural production. Digital transformations in agriculture began with large-scale investments. These investments aimed not only at testing the already developed innovative technologies but also introducing new ones. These processes aimed to increase the competitiveness of agricultural enterprises. Agro-industrial integration caused a sharp increase in production concentration, complicated the functioning of agro-industrial enterprises, and provided higher demand for effective IT-solutions in the agricultural industry. Correspondingly, largescale IT-companies started developing new software for the needs of the agricultural industry and promoting new ways of solving the traditional problems of agriculture. However, there is still no unified strategy for the digital development of agriculture. The governmental management of agriculture faced the same problems. At the beginning of the 2010s, each Russian region started forming their own strategies for the digital transformation of agriculture. These strategies differed considerably between the regions. According to I. S. Kozubenko, this led to the creation of a socalled “zoo” of information systems and technologies. It significantly complicated the formation of a unified information space in the governmental agro-industrial and decreased agricultural management effectiveness [12]. This situation is continuing the long tradition of the non-systemic approach to introducing computer technologies in the agriculture of Russia. Large agricultural enterprises tried to independently implement information technologies in their production and management. This caused obvious disparities in the emerging system
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of information management (e.g., accounting software is more widespread than the software for all other management functions). The lack of a broad positive experience in using digital technologies is a significant roadblock in its development. The lack of a single digitalization strategy causes issues in developing the software for solving broad, typical problems of agriculture. Territorial disparities in the development of digital infrastructure cause problems in integrating economic subjects of agricultural production. Digital transformations in agriculture are mainly aimed at creating systems of precision growing and precision animal husbandry. In the broadest terms, precision growing presupposes leveling the productivity of crops by accounting the environmental variability via global navigation satellite systems, yield monitoring technologies, variable rate application (VRA), remote sensing Earth remote sensing, and geo-information system (GIS) [4, 13]. In the nearest future, the general trends of precision growing are: (1) the development of the parallel driving system; (2) mass digitalization of the fields; (3) differentiated soil treatment; (4) norms on seeding, fertilizers, growth promoters; (5) using smart technologies (the Internet of Things); (6) use of Big Data processing technologies; (7) increasing the quality of ongoing management; (8) introducing self-driving vehicles and machinery; and (9) implementing AI technologies. Precision animal husbandry accounts for the specific features of grown animals and their use. Its main trends are: (1) electronic identification of farm animals, (2) accounting for the individual needs and peculiarities of each animal, and (3) minimizing the inefficient consumption of resources (Ivanov 2019). Precision livestock technologies are particularly widespread on poultry and pig farms, where almost all production processes are automated. However, the digitalization of animal husbandry is the lowest among all branches of agriculture. Currently, the agricultural industry has low priority in the governmental system of digitalization. Digital transformations in the regions are mostly aimed at providing Internet connection to settlements. This leaves large areas of land without the Internet and, therefore, severely limits the implementation of digital technologies in agriculture.
5 Conclusion In this study, we examined the basic problems that limit the digital transformations in agriculture and divided them into four groups. The first group includes industry-specific problems: (1) the need for human interaction with soil and biological objects; (2) high dependency on environmental conditions; (3) distance between the production areas; (4) high duration of production cycles; (5) low automation of production processes; and (6) the diversified nature of production.
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The second group includes territorial problems: (1) low quality of life in rural areas; (2) unwillingness of rural population to accept innovation; (3) rural flight; and (4) low economic activity and mobility of the rural population. The third group includes the features of the innovation system: (1) low innovative activity of agricultural enterprises; (2) low demand for innovation; (3) relatively low capacity for innovation in Russian agricultural science; (4) fragmented innovation infrastructure; and (5) insufficient government support for innovative developments in the agro-industrial complex. The fourth group includes problems of information support: (1) low digitalization of agricultural production and management; (2) fragmented integration into the unified information infrastructure; (3) lack of single strategy for digital transformations in agriculture; and (4) low level of IT-training of managers, professional workers, and staff of agricultural industry.
References 1. Batishcheva EA (2019) Digital agriculture: current state, problems and development prospects. Agric Econ Russ 1:2–6 2. Butyrin VV, Butyrina YA (2019) Directions of digital transformation agriculture. Agric Econ Russ 6:9–14 3. Carlsson B (2004) The digital economy: what is new and what is not? Struct Chang Econ Dyn 15(3):245–264 4. Ivanov AL, Kozubenko IS, Savin IY, Kiryushin VI (2018) Digital agriculture. Bull Russ Agric Sci 5:4–9 5. Ivanova EV, Merkulova EY (2018) Qualitative changes of the state regulation of reproduction processes in agriculture based on digital technologies. Qual Access Success 19(S2):130–134 6. Kosolapova M (2019) Digital agricultural economic system and electronic agricultural development intensification. Stud Comput Intell 826:663–674 7. Kosolapova MV, Svobodin VA (2019) Digital agricultural economy – electronic intensification of the process of agricultural reproduction. Agribus Econ Manage 2:63–72 8. Kreneva S, Tsaregorodtsev E, Sredina Y, Tereshina V (2018) Agro-industrial complex in the conditions of development of digital society as the instrument of economic development of the region. In: Proceedings from 18 SGEM international multidisciplinary scientific geoconference surveying geology and mining ecology management, Albena, Bulgaria 9. Troschin AS, Bozhkov YN, Sandu IS (2018) Digital transformation of agriculture farms as the basis for innovative development. Econ Labor Manage Agric 12(45):3–8 10. Ulezko A, Reimer V, Ulezko O (2019) Theoretical and methodological aspects of digitalization in agriculture. In: IOP conference series: earth and environmental science, vol 274, p 12062 11. Vartanova ML, Drobot EV (2018) Avant-garde innovations of the digital transformation Russian agriculture. Food Policy Secur 1:27–35 12. Kozubenko I (2016) We must ensure the penetration of information technology to each agricultural producer. Connect 10:44–46 13. Voityuk VA (2018) Digital technologies in crop production: domestic practice, prospect of development. Innov Agric 4:311–320 14. Yurina NN (2019) The digitalization of agriculture as a priority direction of russian economic’s development. In: Proceedings from EpSBS CIEDR 2018: the European proceedings of social & behavioral sciences. Akademia Buduschego, Veliky Novgorod, Russia
The Mechanism of Integrational Interactions of Economic Subjects: Methodological Aspects Lilia O. Makarevich
and Andrey V. Ulezko
Abstract Interaction must be considered as a system of objectively existing actions of the subjects imposed by a stable causal nexus and manifested in the natural and predictable reaction of each subject to changes in the behavior of each other. It is the opportunity to understand possible reactions and manage the behavior of interlocutors. The economic interests of all economic subjects determine their interaction. The need for their realization triggers the formation of inter-subjective relations and determines the form of their existence. Integrative relations are characterized by stability and, unlike random market-based interactions, involve the occurrence of exact forms of cooperation of stable subjects, reflecting the specifics of the integrative processes and the mechanism of inter-subjective interactions. Integrative relations are used to coordinate the activity of economic subjects and realize their interests as the result of the establishment of stable economic, organizational, technological, and other kinds of interconnection. The integration of economic subjects implies a special mechanism providing initiation, establishment, and maintenance of integrative relations, taking into account the institutional forms of interaction. This mechanism is proposed to be called the mechanism for integrative interactions. It should be considered as (1) a set of organizational and economic elements defining the aim and objectives of integrative groups, (2) the choice of directions and sustainable forms of integration, (3) the content of integrative relations, (4) specifics of the organization of intra-system and inter-system connections, (5) features of forming an additional value chain and its distribution, (6) an entity of subsystems of legal and regulatory, financial, informational, technical, technological, infrastructure, innovative, and other types of ensuring. Keywords Integration · Integrative interconnections · Mechanism of interconnections · Forms of integrative interconnections
L. O. Makarevich Kuban State Agrarian University named after I. T. Trubilin, Krasnodar, Russia A. V. Ulezko (B) Voronezh State Agrarian University named after Emperor Peter the Great, Voronezh, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_4
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1 Introduction The openness of economic systems objectively involves their interaction with other similar systems of the same level of the hierarchy, as well as the systems of other levels. Forms of the interaction of economic systems are defined by the type of productive relations dominant in the society and the development of productive forces. The technical and technological basis of productive forces objectively makes it the level of the division of labor and specialization of production and the ways of its cooperation and integration. This basis forms the conditions of technological, organizational, and economic interaction of economic entities and habitat for intra- and inter-system relations about production, exchange, distribution, and consumption of economic resources. In a broad sense, the interaction is considered a simultaneous influence of actors on each other. Moreover, the individual impact of each subject cannot fully explain the changes in the entire system resulting from integration [5, 7, 8]. In this context, the interaction is considered as a system of objectively existing actions of subjects arising from the availability of a stable causal dependence. It is manifested in the natural and predictable reaction to changes in behavior and the control of the behavior of the full range of interlocutors. Nowadays, there are three main approaches to describing the essence of the category “interaction of economic subjects.” In the first approach, the interaction is seen as a set of agreed actions of economic actors within the cooperation, unifying them through joint action. The second approach understands interaction as the interference of economic actors on the development (change) of each other through the continuous inter-subjective interconnection. The third approach considers not a set of economic actors, but their particular actions, which allows getting a certain profit from the interaction. According to our understanding, interaction is a process of uninterrupted harmonization of all actions of the subjects who have their system of goal-setting and individual interests, which can be realized only during interrelations with other subjects as a part of the mutual influence on each other [2]. The interaction of economic subjects occurs in the form of their reaction to impulses, which are used by counterparties to make a focused influence on each other. It is necessary to mention the possibility of different reactions of economic subjects to the same information influences. This fact complicates the management of interactions. Therefore, it is necessary to form an adequate institutional environment providing the predictability of the behavior of interacting subjects and the possibility of forecasting the development and achievement of a necessary compromise to achieve the balance of interests. The form of cooperation reflecting the way of integrating technologically, economically, and organizationally interrelated economic entities within the value chain can significantly impact the behavior of economic entities and the specifics of their interaction. One of the priority directions in increasing the effectiveness of interrelations of economic subjects and the stability
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of their development is the formation and development of the mechanism of integrative interactions and the justification of methodological provisions defining the peculiarities of these processes [4, 9].
2 Materials and Methods The research is based on examining and synthesizing scientific approaches to exploring the issues of providing the balanced growth of economic systems of development of the digital economy and digital transformation of agriculture. The research objective is to justify the methodological provisions defining the essence of forming the mechanism of integrative interactions of economic subjects.
3 Results Essential features of interactions of economic subjects can be described with the help of the model reflecting: – – – – – –
The set of interacting actors; The general aim; Individual aims of actors; Forms of interaction; Principles of the organization; Factors defining the conditions of interaction and institutional environment, which determine the behavior of integrative economic subjects.
Interaction can be presented as a sustainable system of the behavior of integrating economic entities, which has certain properties. These properties should include: • The objectiveness of technologic, economic, and organizational interactions of different subjects; • The possibility of alignment of general and individual aims of the development of interactive subjects; • The alignment of the behavior of the interacting subjects over time and space; • The predictability and rationality of the behavior of interacting subjects and their reactions to typical impulses (informational influences); • The presence of a common system of motivation for integration and awareness of the need to balance the interests of interacting subjects; • The availability of the unified economic area allowing to enforce sustainable connections of interacting subjects, etc. The system of organizing the interactions of business entities implies the presence of certain standards determining the expected reactions of entities to the informational influences, as well as the rules taken by all interacting subjects.
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The transparency of these standards and rules is a necessity for each subject, the condition for increasing the stability of interactions, realizing individual interests, and ensuring the economic efficiency of integrating business entities. It is traditionally customary to distinguish several types of intersubjective interactions within the framework of existing approaches to studying their content. Horizontal interactions are typical for the integration of equal entities that: – Autonomously operate at the same level of product and technological chains; – Have the ability to make all key decisions independently; – Realize their interests within the framework of bilateral agreements and contracts. Vertical interaction is formed when there are subjects with dominant interests in creating the final product. This fact determines: – – – –
The standards and conditions of interaction; The process of decision-making; The regulation of the satisfaction of the interests of other participants The control of the way other participants function.
A network-based interaction implies the consolidation of subjects participating in a single production chain as part of the development of an equitable partnership, which allows for balancing the interests of parties and maximizing the synergy effect. Each of the mentioned interaction types reflects a particular mechanism of forming an inter-subjective relation based on: – The principles of minimizing the exchange transactions and market methods of coordination of interacting subjects; – The principles of minimizing managerial transactions, bureaucratic methods of coordination, and redistribution of income; – The principles of public rationalization of inter-subjective interrelations and methods of self-governing coordination. Integrative relations are marked with stability and, unlike random market interactions, imply the emergence of certain forms of cooperation of stably interacting subjects, reflecting the specifics of organizing the integrative processes and the mechanisms of inter-subjective interactions. This form of cooperation ensures the coordination of economic subjects and the realization of their interests due to establishing the sustainable economic, organizational, technological, and other types of interaction [11, 12]. There is a steady growth of the number of people supporting the need to highlight such a specific interaction type as quasi-integration. One of the arguments for using the term “quasi-integration” is that, in contrast to classical integration, which presupposes the establishment of rigid integration ties and legal formalization of integration relations, quasi-integration is based on the use of “soft” forms of interaction. Therefore, quasi-integration provides economic actors with many options when choosing the most rational (optimal) method of realizing their interests [6, 10]. Adherents of this approach believe that with the stable financial position of economic entities and the high quality of the competitive environment that does
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not allow unfair competition and monopolization of local markets, quasi-integration most fully meets the interests of consistently interacting economic entities. Quasiintegrated structures can start to form the structural basis of the new type of economy. Economic integration emerged simultaneously with the division of labor. It ensured the formation of added-value chains. Therefore, we can assume that each stage of developing the system of public production has forms of integrative interactions that ensure (1) a set of integrative subjects, (2) a minimization of transactional costs, and (3) the maximization of the value of economic goods. Moreover, distribution and redistribution of the additional value are defined by the mechanism formed as a part of the exact economic formation and adequate to the existing way of production and the level of development of productive relations [1, 3]. Nowadays, vertical integration prevails in Russian agriculture. The growing influence of large integrated formations on the territorial development and the development of agricultural economics in rural territories objectively implies the increased fragmentation of regional economic areas and regional agricultural systems, generating a number of discrepancies. These discrepancies are connected with the mismatches of interests of big businesses and rural communities. The low efficiency of the state as the main regulator of relations between business and society further complicates the process. Alternative institutional forms are developed along with vertical integration. T. N. Topoleva [13] points out such alternative forms as: – Lateral (productive) integration (the interaction of subjects implementing the production of heterogeneous output but delivering it to the same clients); – Rear-guard integration (the interaction of subjects as a part of the formation of a common infrastructure and minimization of transactional costs and production costs); – Combined integration (a simultaneous interaction of subjects in the technological chain and the production of products with similar consumer properties to diversify sales channels and minimize lost profits); – Parallel integration (interaction of subjects focused on the production of complementary goods through technologic chains or distribution networks); – circular integration (interaction of subjects functioning as part of the same local market but not competing directly). These institutional forms have not found a wide-spread occurrence yet, but are of particular interest from the point of view of understanding the diversity of integrative interactions and the ways of their implementation. The integration of economic subjects implies the availability of a special mechanism of integrative relations. It should be considered as a set of the organizational and economic elements defining (1) the aim and objectives of integrative formation; (2) the choice of directions and rational forms of integration, (3) the context of integrative relations, (4) the organizational specifics of the intersystem relations and interconnections; (5) the peculiarities of the formation of the chains of creating the additional value and its distribution. Additionally, this mechanism is a set of providing subsystems.
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4 Discussion We defined the peculiarities of the formation of individual structural elements of integrative interactions, primarily by (1) the sectoral specific of integrative subjects and (2) the specifics of the product and technological chains within which integration structures are created. The methodology of forming the mechanism of integrative interactions must take into account the following basic situations: • The basis of the interaction of economic subjects is their interests, the necessity of which initiates the occurrence of inter-subjective relations and is caused by the form of their existence; • Integration is the way of interaction of economic subjects caused by the presence of a sustainable causal nexus of the occurrence of cooperative relations; • Integrative interconnections assume the interference of the economic subject with the processes of development through the sustainable system of inter-subjective interconnections and relations which define the way of coordination of their activities; • Integrative interconnections are realized in the form of a reaction to integrative subjects on impulses, through which they directly influence each other; • One of the key properties of integrative interconnections is their stability, which ensures the continuity of the integration formation over a relatively long period; • Interconnected subjects define the sustainability of integrative interconnections as an ability for realizing individual economic interests; • The heterogeneity of economic entities representing different links in the value chain and having different interests necessitates the organization of intra- and inter-industry interactions; • The organizational system of integrative interconnections implies the presence of exact standards defining the expected typical reactions of subjects to typical informational influences and “fair attrition” accepted by all of the interacting subjects; • The integration of equitable subjects functioning independently on the same level of chains of creating the additional value (which are available to make all key decisions by themselves) occurs based on horizontal interactions. • The integration of entities representing various links in the added value chains and marked with the presence of entities with dominant interests that determine the standards and conditions of interaction, making key decisions on the development of an integration association, is implemented through vertical interactions; • The consolidation of entities participating in the value chain as a part of the development of equitable partnerships providing the balance of individual interests and maximizing the systemic synergetic effect through the usage of “soft” forms of integrative connections and special mechanisms of coordination taking place based on network interactions; • Integrative interactions reflect the way of organizing the integration of technologically, economically, and organizationally interconnected economic entities within the chains of value creation and distribution of the received income;
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• The forms that provide sets of integrative subjects, minimization of transactional costs, maximization of economic goods value, and the effectiveness of the chain of additional value dominate on each level of developing the system of public production; • The initiator of creating a specific form of integration interactions, as a rule, is a subject occupying a dominant position in the value chain of additional value creation. The initiators seek to minimize transaction costs and insure themselves against possible opportunistic behavior of their contractors; • If the contractors are economically unstable and cannot provide the stable functioning of multi-link value chains, then the dominant entities in the chain take over weaker subjects and implement the corporate model of integration, giving priority to their economic interests; • If the economic position of the entities at the lower levels of value chains is relatively stable, the operation is efficient, and the market influence is quite strong, then the dominating chain subjects are forced to make compromises and look for forms of interactions that ensure the attractiveness of cooperation and the possibility of maximizing the interests of entities integrating into one or another technological chain; • The diversity of types and forms of integrative interactions objectively necessitates the formation of special mechanisms providing the coordination of vertical and horizontal activities of subjects. They also ensure the interaction of elements and subsystems, forming the organizational structure of economic subjects.
5 Conclusion The mechanism of integration is formed within the system of inter-subject relations. It is a set of three blocks (initiation, design, and maintenance of interactions) that combine structural and functional elements marked with a specific set of methods and tools for implementing individual functions of the mechanism and regulating the behavior of integrating entities, as well as the block of supporting subsystems. The structure of the mechanism of integration interactions is determined based on the totality of the functions it implements, which determine the organization of the initiation, registration, and maintenance of integration interactions. At the stage of initiation of integration interactions, the status of key functions for each subject is acquired by: – The identification of economic interests and awareness of the need for integration; – The identification of alternative product chains that may include the initiated integration interactions; – Possible partners for integration; – The assessment of directions for developing integration, its depth, and possible alternatives; – Expected levels of cost reduction;
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– Expected growth of added value; – Integration risks. The implementation of these functions allows substantiating the reasons for integration and form the information basis necessary for the decision-making of an economic entity. The registration of integration involves the implementation of such functions as: – – – – – –
The final choice of directions and depth of interactions; The required level of transfer of property rights; Schemes for delegating management functions; A specific form of integration interactions; The formalization of the system of integration relations; The formation of mechanisms for coordinating activities and value-added distribution.
At this stage, the interrelations system between the subjects is formalized within the framework of a specific integrated formation. The interaction rules are determined. The stability of integrated structures is ensured by (1) maintaining integration interactions by ensuring the balance of interests of integration subjects and the efficiency of integration processes; (2) the prevention of opportunistic behaviors of the subjects; (3) prompt adjustment of the proportions of distributing the added value; (4) the adaptation to changes of the institutional environment and economic conditions; (5) the formation and preservation of common economic and information spaces in the borders of territories; (6) the formation of forming the spatial basis of integrative communities. The choice of specific forms of integration is carried out based on: – The level of economic, technical, and technological development of the system of social production and integration of economic entities; – The quality of the institutional environment; – The level of monopolization of local markets; – The availability of options for choosing alternative forms of integration; – The general level of production efficiency of certain types of economic goods, etc.
References 1. Bogachev DV (2015) Transformation of agriculture in Russia: significance of present-day vertical integration. Reg Res Russ 5(4):392–401 2. Grekova GI, Fedotova EI (2015) Interaction of economic entities: economic essence and content. Bull Inst Econ Manage Novgorod State Univ 2:12–18 3. Kerashev AA, Mokrushin AA, Prokhorova VV (2015) Problems and prospects development of inter-industry exchange in the territorial agro-industrial complex on the basis of mechanisms of corporate integration. Bull Adygeya State Univ Ser Econ 4(5):173–181
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4. Kuksa IM (2013) Priority trends in the agro-industrial complex development within the contemporary economy. Actual Probl Econ 150(12):51–55 5. Morozov VA (2015) Interaction as a philosophical and economical category (concept, types, and properties). New Word Sci Pract Hypotheses Test Results Stud 20:81–87 6. Ogorodnikov PI, Fedorova OA, Chirkova VYu (2011) Integration as the basis of stable and dynamic development of enterprises in the agro-industrial complex. Econ Reg 4:181–189 7. Ovchinnikov A, Kozenko Z, Bichkov M, Kabanov V, Karpova A (2015) Strategic management of sustainable development of the agro-industrial complex with economic integration. Eur Res Stud J 18(3):307–315 8. Shashlo NV, Petruk GV, Korostelev AA (2018) Determinants of integration interaction among the subjects of the entrepreneurial innovation ecosystem of macro-region. Amazonia Investigate 7(13):351–363 9. Smirnov AA, Stukova IV (2015) Determinants of integration approach in the agrarian sphere development in contexts of transformation. Rev Eur Stud 7(8):8–14 10. Takhumova OV, Lovyannikova VV, Konovalova IA (2016) The innovative mechanism for increasing the efficiency of the regional agro-industrial sector. Actual Probl Econ 184(10):228– 234 11. Tarshilova LS, Kazambayeva AM, Ibyzhanova AJ (2017) Reaction of the regional agroindustrial complex to integration processes. Espacios 38(62):24 12. Tomilina EP, Glotova II, Kuzmenko IP (2013) Development of integration processes in the traditional sectors of agriculture. Middle East J Sci Res 13(Splissue):178–182 13. Topoleva TN (2019) Economic integration in the industry: theoretical-methodological aspect. Bull NGIEI 1:138–148
Strategic Management of the Agro-Industrial Complex in the Territories of Rapid Socio-Economic Development and Its Methodological Support Ludmila Yu. Filobokova and Alexandra Yu. Zhdankina Abstract The agro-industrial complex [AIC] is a highly structured system representing the unity of environmental, social, and economic components, acting as a subsystem of the regional economy. The development of the AIC occurs in conjunction with regional development goals and objectives, improving the quality of life (without detriment to local goals and objectives) and governing food security through mainly idiopathic causes. The problems of socio-economic development in various regions of Russia, including the Sakhalin Region, are expected to be resolved through the implementation of the Federal Law “On the Territories of Rapid Socio-Economic Development in the Russian Federation” (December 24, 2014 No. 473-FZ). Despite significant natural resource potential, the region experiences problems in food selfsufficiency and quality of life. The solution of existing problems predetermined research on the justification of the strategy (by its stages), the development of methodological support (environmental policy), and tools (net accumulation of region’s AIC) of the strategic management of the regional AIC. Keywords Global challenges · Strategic management of agro-industrial complex · Food security
1 Introduction The agro-industrial complex [AIC] of the region is a highly structured system represented by environmental, social, and economic components. It acts as a subsystem of the upper-level system (region) aiming to ensure food security and high quality of life for the population of a geographically localized area. The globalization of the national economy and its integration into the global economic system determines the innovative nature for the development of “the national economy of the Russian Federation” and its subsystems, including the AIC [10]. L. Yu. Filobokova (B) · A. Yu. Zhdankina Bauman Moscow State Technical University, Moscow, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_5
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From the perspective of control theory, the Russian AIC is a meso-level system. The regional AIC is considered to be a meso-level system of lower order. Compositionally, the AIC is a system of immense complexity, both in terms of its industrial and organizational features. The development of the system is subordinated to the global strategic goal of increasing the level of life. The AIC is designed to ensure the quality of food and health while implementing the stated goal. In agricultural regions, the general state and the development of the AIC affect the environmental quality and the income of the population while also being directly dependent on them. The implementation of the goals and objectives set for the AIC requires a perfect management mechanism that includes aspects of business management. The mechanism for the rapid socio-economic development of the territories is one of the examples of innovative forms of business management, also serving as a tool of state policy in regional development. This mechanism aims to diffuse innovation through search and revitalization of development in “reference points of growth.” The implementation of this mechanism in the development of the Russian Far East region is particularly important. This region amounts to about 36% of the Russian territory. It is entrusted with geopolitical and military tasks and protection of national interests [10]. Still, its population continues to reduce due to natural decrease and migration processes. Several distinctive factors negatively affect the quality of life in the Russian Far East, such as low diversification of the regional economy, low level of social infrastructure development, harsh climatic conditions, and low population density. The high rates of depopulation associated with the migration outflow of the population to European regions of Russia and other countries are a consequence of the factors indicated above. To resolve the existing problem, the Government of the Russian Federation developed the Federal law “On the Territories of Rapid Socio-Economic Development in the Russian Federation” (December 29, 2014 No. 473-FZ). The territory of rapid socio-economic development is a part of the Russian Federation (including the closed administrative-territorial entity) under the special legal regime for entrepreneurial activities. The regime serves to create a favorable environment that attracts investment, boosts the economy, and creates comfortable conditions for human life [4]. After examining the cause-and-effect relationships established by the Federal law “On the Territories of Rapid Socio-Economic Development in the Russian Federation” (December 24, 2014 No. 473-FZ), the authors state the following conclusions: • The development of comfortable conditions for human life is the global objective of the law implementation process; • The goal is to be achieved with the help of accelerated economic development created through the attraction of investments;
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• The investments are to be attracted through the establishment of favorable conditions for business activities by the development of institutional environment and infrastructure support. The establishment of favorable conditions for business activities through institutional environment and infrastructure support is closely correlated with the development of the AIC and its prospects. Following the Federal law “On the Territories of Rapid Socio-Economic Development in the Russian Federation,” three projects are currently being implemented in the Sakhalin Region. One of the projects, “Yuzhny,” is connected to the regional AIC. The project was developed in the Anivsky and Tomarinsky districts. The districts are known for their large livestock complexes and broiler plants, while four of their residents are expected to use a budget of 6.2 billion rubles and create 450 vacancies. To construct engineering and transport infrastructures, 1.46 billion rubles were allocated from the Sakhalin Region’s regional budget and extra-budgetary sources (Government of the Sakhalin Oblast, 2013). Collective farms “Teplichny” and “Zarechny” of the Sakhalin Region are considered residents of the Federal law “On the Territories of Rapid Socio-Economic Development in the Russian Federation.” They began their commercial operation in the mid-twentieth century. “Merci Agro Sakhalin” JSC and “Grin Agro-Sakhalin” LLC, on the other hand, are relatively new organizational structures. “Merci Agro Sakhalin” JSC specializes in the production of meat. The project’s implementation will allow it to produce up to 6,500 tons of pork in live weight per year, which is about 50% of the total meat production in the Sakhalin Region. Such production volumes do not solve the problem of self-sufficiency of the region with meat and dairy products following established consumption standards. Thus, only 36.5% of meat consumption in the Sakhalin Region is provided through its production sources. A high level of external supply dependence is still observed. “Grin Agro-Sakhalin” LLC, another resident of the Federal law “On the Territories of Rapid Socio-Economic Development in the Russian Federation” (December 24, 2014, No. 473-FZ), is located in the Sakhalin Region. It specializes in the production of milk and dairy products. The total volume should be brought to 22,720 tons. Still, the coverage of medical consumption standards through domestic production reaches only 18.4% (Table 1). Table 1 Comparative compliance assessment of the actual consumption of meat, milk, and dairy products by the Sakhalin Region population with the established standards in 2018 Value
Norm
Daily consumption of meat and meat products by one person, g
200
73
127
Daily consumption of milk and dairy products by one person, g
800
148
652
Source Developed by the authors.
Actual
Deviation from the standard, g
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While establishing the territory of rapid socio-economic development, the government of the Sakhalin Region concentrated on low levels of domestic agricultural provision but did not manage to fundamentally resolve the problem [5, 6]. The increase in levels of regional food security is currently prioritized both at the federal and regional levels. The rational combination of their administrative actions should be based on the impact of external and internal factors aiming not only at the neutralization of food supply problems but also domestic production support [1]. Following the implementation of the Federal Law “On the Territories of Rapid Socio-Economic Development in the Russian Federation” (December 24, 2014 No. 473-FZ), we advise dividing the strategic management of the AIC of the Sakhalin Region into three stages, which are shown in Fig. 1. The authors believe that strategic management in the AIC in the Sakhalin Region should be modeled on resource and institutional models, which allows for appropriate infrastructure provision. Russian scholars S. A. Evteev and R. A. Perelet [3] noted that to achieve a balanced development of the territory, it is necessary to establish the following elements: • Infrastructure interconnecting all areas of regional development;
Fig. 1 Block diagram of strategic management and development of the AIC of the Sakhalin Region following the implementation of the Federal Law “On the Territories of Rapid Socio-Economic Development in the Russian Federation” (December 24, 2014 No. 473-FZ). Source Developed by the authors
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• The political system ensuring participation of the population in decision-making processes; • The economic system creating conditions for expanded reproduction and technical progress on its basis; • The social system that provides for leveling of the stresses arising due to inefficient socio-economic development; • Systems of production preserving the ecological resource base; • Technological system generating a continuous search for new solutions; • The international system contributing to sustainable economic, trade, and financial relations; • The administrative system capable of adjustment and adaptation. The development of infrastructure support for the AIC of the Sakhalin Region should be of targeted nature while taking into account the impact of endogenous and exogenous factors (Fig. 2.) Scholars see the framework of infrastructure support as a combination of specific proportions or ratios of the elements that form the support in their entirety. The authors also refer to invariance as a permanent set of functions of infrastructure support under a specific composition of elements and institutions of infrastructure support, where the variability of the composition does not affect the functional load of infrastructure support, as suggested by N. V. Kalenskaya [8]. Exogenous factors (the conditions)
Institutional environment
State regulation, development goals, and objectives
Natural resource base that determines the specifics of the complex’s activities
Infrastructure support for the development of the AIC of Sakhalin Oblast
Multifunctional type of infrastructure support
Infrastructure support institutions
Invariance of the infrastructure support framework
Endogenous factors (conditions) Fig. 2 Infrastructure support of the development of the AIC of the Sakhalin Region following the Federal Law “On the Territories of Rapid Socio-Economic Development in the Russian Federation” (December 24, 2014 No. 473-FZ) Source Developed by the authors
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The activity of the AIC is closely related to the ecologization. It determines the development of environmental infrastructure for which the paper proposes a system of environmental management and audit [9]. To ensure the environmental orientation of the AIC of the Sakhalin Region, following the Federal law “On the Territories of Rapid Socio-Economic Development in the Russian Federation” (December 24, 2014 No. 473-FZ) we propose the tools of environmental policy (Table 2). Modifying the methodology for calculating net savings, the authors propose and justify methodological approaches to assessing (calculating and measuring) the net accumulation of the AIC of the region (GSPCR) [2, 7]. It is proposed to calculate GSPCR using the formula: GSPCR = GHPR − OOSC−PPR−YVOS + RRGHC + RVOC + RVOSR
(1)
where: • GHPR—reinvested net income; • OOSC—impairment of fixed assets and other non-current assets; • PPR—the cost of natural resources consumption according to the accounting estimate; • YVOS—the amount of damage from the negative impact on the environment; • RRGHC—expenses for the reproduction of human capital; • RVOC—expenses for the reproduction of fixed capital; • RVOSR—the cost of reproduction of the environment. The indicator “Net savings of the AIC of the region” in the region acting as a territory of rapid socio-economic development should be: • Planned, effectively assessed and subjected to factor analysis; • Evaluated annually; • Measured in absolute (cost estimation) and relative (in % of TP in current prices) values. Strategic management of the AIC of the region recognized as the territory of rapid socio-economic development requires adaptation. Its content is subject to modification with managerial innovations providing diffusion and inflow of benefits in the form of food security problem solving and improving the quality of life of the population. Table 2 Environmental policy as a tool for the development of the AIC of the Sakhalin Region Item No
Goals
Ways if achieving targeted goals
1
Global—ensuring advanced socio-ecological and economic development
Eco innovations
2
Strategic—the formation of an eco-oriented AIC
Eco innovations (continued)
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Table 2 (continued) Item No
Goals
Ways if achieving targeted goals
3
Local goals Goal 1—The development of new processing systems for raw material to reduce the negative impact on the environment 3.1.1. The reduction of hazardous waste generation 3.1.2. The reduction of hazardous waste emissions 3.1.3. Preventive measures 3.1.4.ISO 14,000 certification 3.1.5. The improvement of technological processes 3.1.6. Financial and accounting aspects Goal 2—The development of new technologies reducing production waste 3.2.1. The reduction of the consumption volume (specific volume) of natural resources 3.2.2. The reduction of specific material costs for consumed natural resources 3.2.3. The reduction of “non-productive” consumption, elimination of non-productive consumption 3.2.4. The assessment and motivation of environmentally-oriented personnel activities
3.1.1.1. The use of low-waste technologies 3.1.1.2. Recycling of waste in production 3.1.2.1. The development and implementation of effective cleaning systems 3.1.2.2. The replacement of raw materials and materials containing harmful substances with less harmful ones 3.1.2.3. The use of state-of-the-art technology 3.1.3.1. The development, monitoring, and control of the implementation process of the plan for environmental R&D, capital investments in preventive measures, environmental awareness, education, and upbringing 3.1.3.2. The control of protective and treatment facilities 3.1.3.3. An environmental audit and examination of primary accounting for the use of natural resources and harmful substances, preventing negative consequences and eliminating identified violations 3.1.4.1. The development of environmental policy according to international standards 3.1.4.2. Environmental marking according to international standards 3.1.4.3. The assessment (calculation and measurement) of environmental indicators following the international standard 3.1.5.1. Dismantlement of outdated equipment harming the environment 3.1.5.2. The optimization of placement in warehouse areas 3.1.5.2. The orientation on acquisition (capital construction) of environmental protection equipment 3.1.6.1. The introduction of planning and accounting practices, creation of funds, and reserves for preventive and restoration work to protect the environment and reduce the negative impact of production activities 3.2.1.1. The priority of the consumption of renewable natural resources 3.2.1.2. The use of low-waste and advanced technologies 3.2.1.3 The use of circulating energy resources, circulating water supply 3.2.1.4. The use of secondary resources (obtained as a result of primary processing) 3.2.2.1. Budgeting 3.2.2.2. Planning 3.2.3.1. Maintenance and planned preventive maintenance of working machines and equipment, vehicles 3.2.3.2. The use of preserving technologies 3.2.3.3. The control of consumption 3.2.4.1. The assignment of obligations to comply with the conditions of environmentally-oriented activities in employment agreements and contracts 3.2.4.2. The development of a flexible motivation system for environmentally-oriented activities 3.2.4.3. The development of a plan for training, retraining, and advanced training of specialists with professional environmental education 3.2.4.4. The development of a plan for the formation of environmental ethics and culture
Source Developed by the authors.
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References 1. Alekseev AN (2006) Formation of the economic mechanism of the food supply of the population of the North-Eastern region of Russia, Moscow, Russia 2. Baker M, Foley CF, Wurgler J (2007) The stock market and investment: evidence from FDI flows. NBER Working 9. https://www.nber.org/papers/w10559 3. Evteev SA, Perelet RA (1989) Our common future: report of the international commission on environment and development (ICSD). USSR: Progress, Moscow 4. Government of the Russian Federation (2014) Federal law “on the territories of rapid socioeconomic development in the Russian Federation”, No. 473-FZ, Moscow, Russia, 29 December 2014 5. Government of the Sakhalin Region (2011) Law “on development of agriculture of the Sakhalin Oblast”, No. 81-ZO, Yuzhno-Sakhalinsk, Russia, 15 July 2011 6. Government of the Sakhalin Region (2013) Resolution “On approval of the state program of the Sakhalin region. The development of agriculture in the Sakhalin region and regulation of markets for agricultural products, raw materials, and food”, No. 427 (as amended on 17 July 2019), Yuzhno-Sakhalinsk, Russia, 6 August 2013 7. Guogang W, Xuqiang H (2006) Opportunities in a new perspective: a review of 2005 and an outlook of the Chinese stock market in 2006. Finance and Trade Economics, 4 8. Kalenskaya NV (2007) The core of development: infrastructural support of the innovative activity. Russ Entrepreneurship 7(2):55–58 9. Presidential Executive Office (2010) The doctrine of food security of the Russian Federation, no. 120, 30 January 2010 10. Ragulina JV, Bogoviz AV, Lobova SV, Alekseev AN, Pyatanova VI (2020) Strategy of increasing the global competitiveness of Russia’s economy and Russia’s becoming a new growth vector of the global economy. In: Lecture notes in networks and systems, vol 73, pp 203–210
Sustainable Agriculture in Russia: The Role of Eco-Friendly and Organic Technologies Natalia Yu. Nesterenko , Alexander V. Kolyshkin , and Tamara V. Iakovleva
Abstract The concept of sustainable development, formed in the second half of the twentieth century and undergoing changes in the face of the latest global challenges, was reflected in the system of goals and objectives of agricultural development. Sustainable agriculture becomes responsible for the social, environmental, and biological aspects of the activity along the entire length of the supply chain of agricultural products from producer to the final consumer. Based on the concept of sustainable agriculture, the authors characterize the current state of the industry in Russia and identify directions and tools to reduce adverse economic, social, and environmental effects and increase sustainability. The paper provides a grouping of food products according to the applied technologies and identifies trends in the development of legislation in the environmental differentiation of products. The development factors of eco-friendly and organic production are analyzed from the standpoint of manufacturers and consumers, taking into account the production capabilities of personal subsidiary plots. The paper aims to identify areas of development and tools for improving agricultural sustainability in Russia, including in the sector of eco-friendly and organic production. Keywords Sustainable development · Sustainable agriculture · Climate-oriented agriculture · Organic agriculture · Organic products · Greenhouse gases
1 Introduction The increase in food demand, due to the general increase in world population and the growing per capita consumption in developed countries, necessitates a constant increase in the yield (productivity) of farms and production volumes due to intensive agricultural technologies. Severe changes in the food system are associated with the N. Yu. Nesterenko (B) Saint-Petersburg State University, St. Petersburg, Russia A. V. Kolyshkin · T. V. Iakovleva Herzen State Pedagogical University of Russia, St. Petersburg, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_6
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growing consumption of livestock products, which affects the agricultural system since it requires the production of feed. The annual per capita demand in industrialized countries is 550 kg of grain and 78 kg of meat, while in developing countries—260 kg of grain and 30 kg of meat [14]. The intensification of agricultural development due to an increase in applied fertilizers and the development of agrochemicals negatively affects the environment. Soil degradation, reduction of biological diversity, water pollution, emissions of greenhouse gas [GHG] do not allow ensuring environmental quality for the near future. In the scientific community, there appeared a hypothesis about the negative impact of growing agricultural productivity on climate change in the world [14], including due to an increase in the volume of applied fertilizers. Under these conditions, the concept of sustainable agriculture becomes essential [5]. The principles of sustainable food production and agriculture, formulated by the Food and Agriculture Organization [FAO], are aimed at achieving the environmental, economic, and social effects of development: • Increasing the efficiency of activities through the efficient use of available resources; • Conservation, protection, and improvement of natural resources; • Protecting and enhancing livelihoods, equality, and social well-being; • Resistance to changing external influences; • The use of responsible and effective management mechanisms [8]. One of the most critical tasks of sustainable development is to provide the growing world population with sufficient food. Even though industrial mass production using modern intensive technologies plays the leading role in achieving this goal, there is a sufficient number of alternative agricultural technologies in the world that can improve agricultural sustainability: organic agriculture, biological farming, alternative agriculture, ecological agriculture, etc. The works of domestic scholars [1, 16, 18] focus on directions and tools for the development of the green economy, including organic agriculture. The research allowed to indicate factors for the development of sustainable agriculture in Russia, the prospects for mitigating the effects of climate change by changing existing technologies to eco-friendly ones. The task of increasing the sustainability of agriculture while maintaining high production volumes remains extremely urgent and is expressed in finding a balance between mass industrial production and eco-friendly technologies. An essential scientific and practical issue is determining the type of intensification of agricultural production using human, natural, social, physical, and financial capital while minimizing the negative impact. Even though agriculture occupies an insignificant share in the Russian economy (about 4.5% of the gross value added), this sector plays one of the most critical roles in the country’s economy, including in the context of sustainable development and solving the problems of climate change. The development of agriculture aims to solve a whole range of social and economic problems related to food security, rural development, economic growth, etc. However, at the same time, an increase in agricultural production using intensive industrial technologies will inevitably lead to
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an increase in adverse effects, including greenhouse gas emissions, soil degradation, a decrease in biodiversity, etc. Therefore, the formation of an agricultural development strategy based on the principles of sustainability can help to avoid various negative consequences of intensification, including in the context of climate change.
2 Materials and Methods In the context of climate change, domestic agriculture’s development should be aimed at increasing its efficiency while identifying reserves for reducing GHG emissions. In a broad understanding of the agricultural production chain, the GHG emissions are recorded not only in agriculture, but also in the sector of land use, land-use change, and forestry [LULUCF]. Moreover, the production processes associated with the creation of agrochemicals are accompanied by GHG emissions. The decrease in emissions from arable land is due to a reduction in arable land, a recent increase in the average yield of most cultivated plants, and a decrease in the microbial respiration of arable soils as a result of low doses of organic fertilizers [10]. The state program for the development of agriculture and regulation of agricultural products, raw materials, and food markets for 2013–2020 implies an increase in crop production by 18.41%, and livestock by 19.58% [9]. At the same time, the emissions of nitrous oxide (N2 O) arising from agricultural lands of the system for collecting, storing, and using manure and litter are the most significant greenhouse gases from agriculture. In turn, the increase in livestock will cause emissions of methane (CH4 ) [6]. The use of mineral fertilizers in crop production is an essential indicator of agricultural sustainability. On the one hand, an increase in the volume of applied fertilizers ensures an increase in productivity. On the other hand, it leads to an increase in GHG emissions from agriculture and fertilizer production and significant soil degradation. Among countries with comparable climatic conditions (Ukraine, Belarus, Estonia, Finland), Russia is marked with a minimum level of consumption of mineral fertilizers. The relatively low level of chemicalization of domestic crop production can be assessed as a positive aspect of agricultural sustainability. The high export potential of domestic grain is associated with its high quality and low residual agrochemical content. Further development of Russian agriculture should simultaneously take into account the tasks of increasing production volumes, ensuring food security, and increasing the sustainability of the industry in economic, social, and environmental aspects. In this regard, the stimulation of the development of industrial mass production should be accompanied by the development of eco-friendly technologies that can become a source of environmental and social innovation in the industry. One of the most common strategies for improving agricultural sustainability in the world is the development of organic farming, which almost totally prohibits the use of agrochemicals. Compared with mass industrial and agricultural production,
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organic agriculture, as a segment of the agro-industrial complex [AIC], is highly sustainable and is the source of the best available technologies [4]. The modern concept of Organic 3.0 is a system of goals and directions for their achievement, ensuring the sustainability of agriculture in this segment. One of the first contents of this concept was formulated by S. Strodres, L. Strodres, S. Braun, and G. Rahmann [17]. In Russia, organic production is predominantly carried out by enthusiasts on a small scale, in small farms, or large agricultural holdings to diversify production. The level of development of the Russian organic food market relative to developed countries is rather low [7]. Thus, in 2015, the German organic food market amounted to 8.620 million euros, losing only to the United States, where annual sales amounted to 35.782 million euros. In 2015, the average per capita consumption of organic food in Germany was 106 euros per year, being behind Switzerland (262 euros), Denmark (191 euros), Sweden (177 euros), Luxembourg (170 euros), Liechtenstein (142 euros), Austria (127 euros), and USA (111 euros) [19]. For comparison, in 2016, the organic food market in Russia amounted to 5,100 million rubles, which amounted to about 70 million euros [19]. The average per capita consumption of organic food in Russia (0.48 euros per year) cannot reflect consumers’ real expenditures since the market has a strong geographical differentiation, concentrated mainly in cities with high incomes. About 80–85% of the Russian market for organic products is occupied by imports (mainly processed products). The positioning of organic food on the Russian market is currently not precise enough—from dietary products to the premium food segment. This feature influences the choice of distribution channels and promotion features [11, 13]. Domestic scholars also study the issues of the perception of organic agriculture by producers [3, 11, 14]. Thus, as a result of a survey of agricultural producers in St. Petersburg and the Leningrad Region in 2017, it was found that 46.8% of respondents studied the features of organic farming, and 32.9% heard something about it [11]. According to the IFOAM annual report, in 2015, there were 82 certified manufacturers and 37 certified processors in Russia [19]. Farms are located mainly in the European part of Russia due to the proximity to potential consumers. The prices on organic food include a premium margin reaching up to 200–400% [13]. According to internationally recognized requirements, a poorly-developed system of organic certification and the lack of a definite position on the part of the state do not allow this segment to develop. The institutional environment of organic agriculture is analyzed more deeply in the works of domestic scholars [3, 11, 12, 15]. It is impossible to improve agricultural sustainability without stimulating the development of various eco-friendly production technologies. It results in improved soil quality, increased biodiversity, reduced GHG emissions, and other positive effects associated with the production process and processes occurring in adjacent industries (food industry, chemical industry, land use, and forestry). Large agricultural organizations produce the vast majority of domestic food. Peasant farms still make up a small part of the production volume. However, small farms could solve many social problems in rural areas by ensuring social welfare as a task of the sustainability of the industry.
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In terms of product quality and the nature of the used technology, all agricultural products can be divided into three types: • Mass production using intensive industrial technologies; • Products using eco-friendly technologies; • Products manufactured using organic technologies and having the appropriate certificate. Intensive industrial technologies using mineral fertilizers, chemical plants, and animal protection products, chemical preservatives, etc., allow ensuring large volumes of production, as well as high production efficiency, processing, and distribution of products. The volume of use of certain ingredients in production is regulated by the relevant GOSTs or technical specifications of particular enterprises. Agricultural organizations apply industrial technologies in mass production, providing an increase in production volume in crop production and animal husbandry. According to Table 1, organic production technologies are the most eco-friendly. In terms of the requirements for the use of chemicals in production, organic products are the cleanest. The Codex Alimentarius indicates that some ingredients not meeting organic requirements can be used to the extent not higher than 5% by weight of all ingredients. A rigid system for controlling production processes and the used ingredients ensures high-quality products. However, from an economic and organizational perspective, such certification may not be effective for everyone. Large agricultural organizations, incorporating organic farms, have both financial and organizational capabilities for certification and annual monitoring of all production processes. Furthermore, the extended supply chain of products and the lack of direct contact with the final consumer make it necessary to confirm the high quality with a corresponding certificate. In Russia, peasant farms rarely pass organic certification. This is due to the lack of precise positioning of organic products on the domestic market and the presence of alternative opportunities to confirm the high level of quality of their products, including digital technologies. Organic production is carried out only in the business segment since private farms produce products in small volumes and do not sell them in the agribusiness supply chains. Table 1 Types of agricultural production by various agricultural entities Production types
Agricultural organizations
Industrial technologies
Mass agricultural products Products using of industrial production industrial manufacturing technologies
Chaotic use of agricultural technologies, including industrial ones
Eco-friendly technologies
Eco-friendly products
Eco-friendly products
Eco-friendly products
Organic technologies
Certified organic products
Certified organic products
Source Developed by the authors
Peasant and farm enterprises
Private farms
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According to this typology, eco-friendly technologies are an intermediate level between industrial and organic production. The requirements for the use of minerals and chemical plants and animal protection products are softer than organic ones, which makes them easier to use and more attractive for manufacturers. All subjects of production use eco-friendly technologies. Agricultural producers use mineral fertilizers, pesticides, and herbicides chaotically and often without control. In this case, the main criterion is the number of costs for them. Peasant farms are mainly focused on eco-friendly technologies, which formed a correspondence between farms and eco-friendly products. The lack of legislative regulation in the production of ecofriendly products does not allow us to highlight the limits of the “environmental cleanliness” of the product.
3 Results Comparing the applied technologies and organizational forms of agriculture shows that increasing the sustainability of the industry can be achieved in the production of eco-friendly and organic products by all agricultural producers. The main emphasis in state support should be placed on farms since they are more focused on the local community in terms of financial flows, social ties, local traditions, and environmental priorities than large agricultural holdings. The Federal Law “On Organic Products” will come into force on January 1, 2020, which will determine the main participants in the organic food market and the general framework for regulating organic food producers. At the same time, state support does not differ from general measures of agricultural support. Further development requires a domestic certification for organic requirements so that the procedure becomes as accessible as possible for agricultural organizations and farms. Along with organic products, there is a process of developing a legislative framework for the production of eco-friendly products. Currently, the draft law “On Organic Agriculture, Raw Materials, and Food” is being discussed. It envisages defining organic products as the “average” option between industrial and organic production. The draft law aims to regulate the production, storage, transportation, labeling, and sale of eco-friendly products. The document provides for the development of national standards (GOSTs), which will determine the technical and technological requirements for such products. Also, it is planned to create specialized laboratories to assess their compliance with all established requirements and conduct soil monitoring. The differentiation of agricultural products according to the degree of use of agrochemicals allows producers to have the opportunity to position their products with the appropriate label established by law. From increasing the sustainability of agriculture, the phased differentiation of applied technologies may become an opportunity to phase out the use of agricultural chemicals. It is hard to assess the degree of the output of eco-friendly products until state standards in the field of eco-friendly products have not been developed.
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4 Discussion The study of agricultural sustainability and the relationship between eco-friendly technologies and industrial production inevitably leads to a clash of various interests. For the domestic economy, this problem is complicated by the array of socioeconomic problems of rural areas: youth migration to cities, the low skill level of rural residents, low level of entrepreneurial activity of the population, infrastructure problems of agriculture (including the complexity of transport connections), etc. At the same time, the trends in the development of organic agriculture in the world will inevitably affect the Russian agro-industrial complex. The study of both positive and negative foreign experience in regulating the segment of eco-friendly products, including organic, will allow us to form a set of directions for increasing the sustainability of agriculture.
5 Conclusion The tasks of increasing the sustainability of Russian agriculture require solving the economic, environmental, and social problems of the industry. Large agricultural organizations, including agricultural holdings, managed to improve the efficiency of farms due to the intensification of production and the use of agricultural chemicals. At the same time, environmental problems are growing, which solution is possible through the development of eco-friendly technologies and the competent management of natural resources. The legislative allocation of eco-friendly products and organic products into different groups allows, on the one hand, to have the prospect of a phased development of eco-friendly technologies for the manufacturer. On the other hand, the domestic brand of an eco-friendly product in the world market, in our opinion, will be underweight, since organic brands are widespread and have a clear perception in the eyes of consumers. Issues of regional and product lines of development of eco-friendly production require further study since the limited resources and the complexity of the tasks to be solved require a concentration of efforts in narrow segments.
References 1. Altukhov A, Nechaev V, Porfiryev B (2013) Green agricultural economics. Russian State Agrarian University, Moscow. Timiryazev Agricultural Academy, Moscow 2. Arkhipova VA, Kulagina AG (2017) Organicheskoe selskoe khozyaystvo: zarubezhnyy opyt i rossiyskie perspektivy. Uspekhi sovremennoy nauki i obrazovaniya 3(3):60–62 3. Avilova AV (2016) What are the prospects for organic agriculture in Russia? Bull Russ Acad Sci 86(3):237 4. Bogoviz AV, Semenova EI, Ragulina JV (2019) Agricultural products’ quality. In: Lecture notes in networks and systems, vol 57, pp 154–160
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5. Buzdalov IN (2015) Agriculture of Russia: a view through the prism of the concept of sustainable development. AIC Econ Manag 8:3–16 6. Davidson EA (2009) The contribution of manure and fertilizer nitrogen to atmospheric nitrous oxide since 1860. Nat Geosci 2:659–662 7. Federal State Statistic Service (2016) All-Russian agricultural census. https://www.vshp2016. ru/resume/ 8. Food and Agriculture Organization of the United Nations (n.d.) Sustainable food and agriculture. https://www.fao.org/sustainability/ru/ 9. Government of the Russian Federation (2012) The decree “on the state program for the development of agriculture and regulation of agricultural products, raw materials, and food markets for 2013–2020” (14 July 2012 No. 717, as amended on 15 July 2013; 15 April, 19 December 2014; 13 January, 31 March, 29 July, 10 November 2017), Moscow, Russia 10. Ministry of Natural Resources and Ecology of the Russian Federation (2017) The third biennial report of the Russian Federation submitted the following decision 1/SR.16 of the conference of the parties to the United Nations framework convention on climate change. https://unfccc.int/files/national_reports/biennial_reports_and_iar/submitted_ biennial_reports/application/pdf/386415_russian_federation-br3-1-3br.pdf 11. Nesterenko N, Artemova D (2018) Prospects for the development of sustainable organic food supply chains in Russia. Agric Econ Russ 7:2–16 12. Nesterenko N, Pakhomova N (2016) Organic agriculture in Russia: conditions for the transition to a sustainable development trajectory. Agric Econ Russ 12:34–41 13. Nesterenko N, Shagalkina M (2019) Comparative characteristics of the organic food market in Russia and Germany. In: IOP conference series: earth and environmental science, vol 274. https://doi.org/10.1088/1755-1315/274/1/012059 14. Pretty J (2013) Agricultural sustainability: concepts, principles, and evidence. Philos Trans Roy Soc B 363(1491):447–465. https://doi.org/10.1098/rstb.2007.2163 15. Scherbakova AS (2017) Organic farming in Russia. World Sci Discoveries 9(4):151–173 16. Schulze E, Pakhomova N, Nesterenko N, Krylova U, Richter K (2015) Traditional and organic agriculture: an assessment of comparative efficiency from the standpoint of the concept of sustainable development. Bull St. Petersburg Univ (Ser 5 Econ) 4:4–39 17. Strodres S, Strodres L, Braun S, Rahmann G (2011) Organic farming 3.0? https://orgprints. org/19785/ 18. Ushachev I, Paptsov A, Tarasov V (2009) Organic food production: world experience and prospects of the Russian market. AIC Econ Manag 9:3–9 19. Willer H, Lernoud J (eds) (2017) The world of organic agriculture. Statistics and emerging trends 2017. Organics International, Bonn. https://www.organic-world.net/yearbook/yea rbook-2017.html
Priority Areas in Agricultural Development in the Republic of Uzbekistan Gulchexra Dj. Khalmatjanova
and Muazzam S. Mannopova
Abstract The paper discusses the current problems and issues of increasing the export potential of the agricultural sector and increasing the volume of procurement of value-added products. The world experience is analyzed. Keywords Agriculture · Export potential · Value-added · World experience · Reform
1 Introduction On September 6, 2019, the President of the Republic of Uzbekistan, Shavkat Mirziyoyev, held a meeting on the priority areas of agricultural development for 2020–2030. Uzbekistan has great potential in the agricultural sector. The development of the agricultural industry determines success in resolving many issues (from the abundance in the markets and the welfare of the population to the provision of additional export earnings). However, this area did not receive due attention for a long time. There was no market approach, the attitude to land as a source of income, and material interest. Funds and scientific innovations were not involved. Thus, as a result, the land “overworked” and soil fertility decreased. There was no product processing system, no value chain. Recently, measures to reform agriculture and introduce market mechanisms were taken. As a result of an increase in government procurement prices, agricultural producers’ interest has almost tripled. Cotton growing and grain growing spheres became a real source of profit. To introduce new technologies and innovations, increase labor productivity, and increase the wages of workers in the sphere, 76 cotton-textile clusters were organized. This year alone, water-saving irrigation technologies have been introduced to 25
G. Dj. Khalmatjanova (B) · M. S. Mannopova Ferghana State University, Fergana, Republic of Uzbekistan © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_7
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thousand hectares of cotton fields. Large-scale work on the restoration of 1,100,000 hectares of degraded land begun. This is just the first stage of transformation in this area. The President sets the task to bring reforms in the industry to a new level and to take long-term actions. To this end, an agricultural development strategy for 2020–2030 is being developed. It is designed to become the main point of growth, the economic driver. Thousands of new jobs will be created, and the population’s incomes will increase. The meeting identified essential tasks for the implementation of the developed strategy. It is emphasized that landowners will invest in land, strive to increase fertility and productivity only when they are fully confident in the future. In this regard, the President noted the need for a complete update of the legislation to ensure transparency of the land allocation system, its inviolability, guaranteed protection of land rights, and the introduction of the concept of “responsible attitude to land” in legal circulation. This will provide employment, export, and additional revenue to the budget. It was noted that, first of all, it is necessary to keep accurate records of agricultural lands and improve their use. In this regard, the State Committee of the Republic of Uzbekistan on Land Resources, Geodesy, Cartography, and the State Cadastre was instructed to complete land inventory work in all regions of the country by the end of 2021 and create a unified electronic database for maintaining their records. The rational use of water resources is also important. As the analysis shows, billions of cubic meters of water are sent to irrigate crops in Uzbekistan, but only 60% reach the fields, the rest are lost in irrigation systems and during the irrigation. According to the forecasts of the World Resources Institute, by 2040, Uzbekistan may be among 33 countries with severe water shortages. In this regard, the President paid particular attention to this issue and noted the need to increase efficiency, record water use, and introduce water-saving technologies on 200 thousand hectares of land each year. It was noted that these tasks should be reflected in the developed strategy. During the discussion of state support for agriculture and improving the public procurement system, it was pointed out that it is necessary to direct the bulk of budgetary funds to increase land fertility, introduce water-saving technologies, and develop science. Currently, it is urgent to solve the issue of increasing agriculture’s export potential and increasing the volume of procurement of value-added products. The world experience is analyzed. For example, in Turkey, products for $2,000 are grown on 1 hectare of land, in Egypt—for $8,000, and in Israel – for $12,000. In Uzbekistan, this figure does not exceed $300. Domestic products do not withstand competition in the foreign market, as they are produced according to different standards. In 2018, agricultural products worth $2.3 billion were exported. As a result of the implementation of the tasks included in the new strategy, it is expected to bring this indicator to $20 billion by 2030. There exist necessary labor conditions for this. However, there are not enough personnel who know about foreign economic activities.
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At the meeting, responsible officials were instructed to introduce a product certification system according to the European Union, East Asia, and the Arab world standards. Priority should be given to the selection of varieties of fruit trees. Private land represents a large reserve for agriculture, which is why widespread implementation of local logistics and cooperation based on the principle of “one mahalla—one product,” the unification of small producers into cooperatives, and ensuring uniformity of production is necessary. According to our calculations and the experience of developed countries, it is possible to get $3–5 billion when exporting fresh fruits and vegetables to other foreign countries. There are disadvantages to the service sector. Due to the lack of competition, there is a high cost of service, and product manufacturers have no choice. Therefore, the need for expanding the range of services in the field of delivery of mineral fertilizers, equipment, etc. based on public–private partnerships, as well as the organization of private enterprises, is indicated. It is indicated that the work on space sensing, which was started this year, should be fully completed by the end of 2020, which will allow assessing the real state of land and crops. As a result, this system will provide comprehensive information about the vegetative process, reclamation state, level of mineralization, and soil moisture, which will contribute to increasing productivity by 25%–30%. This will be beneficial not only to the state but also to the farmers themselves. With access to the system, farmers and exporters will be able to monitor what crops are grown and in what location, which will help to build business plans and assess market conditions with confidence.
2 Results and Discussion The results of our research show that we need to fundamentally improve the system of maintaining agricultural statistics. In particular, it is necessary to introduce digital technologies in all processes from the placement of crops to the sale of finished products. Based on digital technologies, it is necessary to develop modern technological maps to cultivate crops based on zones. Then, it is necessary to scientifically develop a graph of machine use based on integral curved lines. This makes it possible to use the machine and tractor fleet more effectively. Indeed, it is necessary to develop a methodology for the formation of agricultural universities based on the application of entrepreneurial activities as soon as possible. First of all, qualified personnel are needed to effectively organize the implementation of the tasks provided for in the Strategy. Seven specialized universities annually graduate more than 3 thousand young people, but there are not enough personnel in the regions. There is no integration of science, education, and production; modern educational methods have not been introduced. Only 0.1% of the budget funds are allocated for the development of agricultural science, while in developed countries this figure is 2%–3%. The number of scientific schools of academicians decreased from 50 to 17. There are no such schools in
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vegetable growing, grain growing, plant growing. Laboratory equipment at the institutes of crop production, vegetable and melon crops and potato growing has not been repaired for the past 70 years. Measures to commercialize scientific development remain ineffective. For example, the export of cherries in many countries begins in June. If Uzbekistan creates a variety that would keep up in early May, the proceeds from the supply of such cherries could be doubled.
3 Conclusion Research institutes in the field of agriculture should focus on the creation of early ripening varieties. Achievements of science should also be introduced into animal husbandry, and livestock breeds that meet climatic conditions should be bred. The President pointed out the need to discuss the strategy with the people and deeply study all its aspects. He gave instructions on the development of annual roadmaps for the effective implementation of the strategy and a review of the structure of territorial agricultural departments. The necessity of introducing a completely new teaching methodology at the Tashkent State Agrarian University and the Tashkent Institute of Irrigation and Agricultural Mechanization Engineers, the organization of field lessons and seminars by the teaching staff, was noted. In general, the new strategy will contribute to the introduction of market mechanisms in agriculture, the establishment of science-based production, which will lead to more efficient food security, multiple increases in exports, and the volume of food products per capita. The heads of the responsible departments provided information on the upcoming work to fulfill the tasks set at the meeting. To provide the agricultural sector with agricultural machinery, a resolution “On measures for accelerating the development of agricultural engineering, state support for the provision of the agricultural sector with agricultural machinery” (July 31, 2019 PP-4410) was adopted by the President of the Republic of Uzbekistan. A program for the development of the agricultural machinery industry until 2025 will be developed. It includes: – The establishment of production of budget models of new types of agricultural machinery, the creation of a new national “brand” of agricultural machinery manufactured in the republic; – The expansion of production of types of equipment for horticulture, fruit and vegetables growing, cattle breeding, and an increase in total production; – The increase in the share of exports of finished products compared with manufactured products to 20% in 2022 and up to 30% in 2025;
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– The introduction of modern corporate management methods, in particular, the automated accounting system “ERP,” production management system “GMS,” the quality management system “BIQ”; – The organization of production of small-scale mechanization equipment for agriculture; – Optimization of existing equipment and vacant land areas of machine and tractor parks, their specialization mainly in repair and provision of services. The following procedure for state support of agricultural mechanization will be introduced: – The provision of subsidies in 2019–2021 in the amount of 15% of the machinery cost if the agricultural enterprise purchases agricultural machinery produced in the republic with a localization level of at least 20%; – The compensation of 80% of transportation costs for transporting combines for the provision of services abroad. At the request of commercial banks, funds will be allocated in the equivalent of $60 million in national currency through preferential credit lines to finance domestic agricultural equipment purchases. The resolution approved the list of professional colleges assigned to higher educational institutions in agricultural mechanization, agricultural engineering, the operation of agricultural machinery, and technical services. In these vocational colleges, training is carried out for up to 2 years in full-time, evening, and correspondence courses based on the complexity of professions and specialties. Branches of the relevant specialized departments of the Tashkent Institute of Irrigation and Agricultural Mechanization Engineers, the Tashkent State Technical University, the Turin Polytechnic University in Tashkent, and the Tashkent Institute for the Design, Construction, and Operation of Roads will be organized at the enterprises of the “Uzagrotechsanoatxolding” JSC. Citizens who have worked at the enterprises of JSC “Uzagrotechsanoatxolding” for at least five years will be accepted to study at higher educational institutions in the areas of agricultural mechanization, agricultural engineering, the operation of agricultural machinery, and technical services, and evening and correspondence courses based on differentiated paid contract based on interview results. From September 1, 2019, at the expense of the “El-Yurt umidi” Fund, specialists will be trained abroad and dialogue with compatriots under the Cabinet of Ministers of the Republic of Uzbekistan in agricultural mechanization, agricultural engineering, operation of agricultural machinery, and technical services: – Masters, doctoral students, professors, and scientific and engineering workers of the industry are sent to study and get advanced training in leading foreign higher educational and scientific-technical institutions; – There is a paid contract for the training of talented undergraduate students in foreign higher educational institutions, studying based on joint programs with the issuance of double diplomas.
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References 1. Republic of Uzbekistan (2018) The message from the President of the Republic of Uzbekistan Sh. Mirziyoyev to the Oliy Majlis. Tashkent, Uzbekistan 2. Republic of Uzbekistan (2019) The decree of the President of the Republic of Uzbekistan “On measures to accelerate the development of agricultural engineering, state support for the provision of the agricultural sector with agricultural machinery”, 31 July 2019, p. 4410.Tashkent, Uzbekistan 3. Xalq so’zi (2019a) Agricultural mechanization – to a new level. https://xs.uz/ru/post/mekhaniza tsiyu-selskogo-khozyajstva-na-novyj-uroven. 4. Xalq so’zi (2019b) A new phase of agricultural reform has been identified. https://www.xs.uz/ ru/post/opredelen-novyj-etap-reform-v-selskokhozyajstvennoj-sfere.
Regional Features of Agricultural Development in Russia Lidia S. Arkhipova
and Irina V. Gorokhova
Abstract The development of agriculture in Russia is given considerable attention due to its role in ensuring food security of the country. The country’s potential and state support allowed it to regain the leading position in the world product market and provide the population with essential food products. The primary goal of our research is to identify the main territorial subjects developing agriculture and occupying leading positions in the manufacture. The research also aims to determine their contribution to the development of the agricultural sector. The paper classifies regions by main socio-economic indicators. Statistical and indicative methods were used to assess the state of agriculture in the leading regions. The main results obtained in the study help to identify the leading regions according to their contribution to the development of crop and livestock breeding. The authors establish structural features of agricultural production in major farm categories. In conclusion, the work assesses the dynamics of the main financial results of leading regions and changes in the profitability of agricultural organizations. The novelty of the research lies in the approach taken to the diagnostic of the socio-economic situation in leading territorial subjects, which demonstrates the relevance of the development of traditional regional specialization, along with the production of crops and livestock. Keywords Leading regions · Agricultural specialization · Target indicators · Agro-climatic resources
1 Introduction Agriculture is one of the most important economic activities in Russia. It ensures the food security of the country and sustainable socio-economic development of its regions [6]. Considering the features of the current period, marked with the instability of world markets and the external negative impact on the Russian economy, the role of agriculture is particularly important in ensuring a high standard of living for the L. S. Arkhipova (B) · I. V. Gorokhova Plekhanov Russian University of Economics, Moscow, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_8
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population. Besides, efficient agriculture providing high-quality raw materials for the food industry is a state priority [3, 12]. The beginning of the current decade was marked with high dependence on food imports, while, by the end of this period, the situation changed radically. Russia is the largest grain exporter. It fully covers the demand of the population for food products, except for several types of fruits, vegetables, and dairy products [9]. Although Russia is a northern country with 2/3 of its territory located in the northern territory, it is highly efficient in its agricultural development. Russia accounts for 10% of the world’s total arable land. Its agricultural land occupies 13% of the country’s territory, while its cropland takes up 8%. The main area of population resettlement and economic activities, including agricultural activities, passes through the territory of Central Russia, the Volga Region, the North Caucasus, Ural, and southern Siberia, where a significant part of the territory is arable.
2 Materials and Methods The paper takes an analytical approach to study regions covering a significant part of the demand for agricultural products. This approach allows scholars to diagnose and assess the importance of these regions to the Russian economy. Thus, the study aims to identify Russian subjects occupying leading positions in agricultural production and to diagnose their development. The main research methods are as follows: statistical method, comparative method, systematic method, and regional analysis method based on the classification of regions. The comparative method allowed us to identify the leading regions in agricultural production, including livestock and crop breeding production (Table 1). Statistical data indicates relatively low values of leading agricultural regions in the main socio-economic indicators. The statistics revealed a significant correlation between agricultural production, the population base, the contribution to the gross regional product, and capital investment (Table 1). These regions do not have the status of leading regions in other areas of economic activity. However, most of them belong to the group of average economic development, with a small part belonging to outsiders. The materials and statistical data provided by the Federal State Statistics Service allowed us to analyze and evaluate the current situation and rank Russian territorial subjects in real-time. Analytical calculations are based on the annual statistical data of statistical books “Rural territories of the Russian Federation” and “Regions of Russia. Socio-economic indicators.” The regulatory and legislative framework of the research is based on the Doctrine of food security of the Russian Federation and the Federal law “On the Development of Agriculture.” [10]. As target indicators, the study uses the index of industrial production of agricultural products, financial results of enterprises, profitability, and investment in fixed assets.
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Table 1 The role of the main agricultural regions in the main socio-economic indicators, 2017 Regions
Relative share in leading indicators Agricultural output, %
Population in Russia, %
Gross regional product
Investment in fixed assets
Manufacturing sector output
Krasnodar Krai
7.1
3.8
2.9
3.1
2.38
Rostov Region
5.0
2.9
1.8
2.0
2.0
Belgorod Region 4.4
1.1
1.1
0.9
1.62
The Republic of Tatarstan
4.0
2.7
2.8
4.0
4.12
The Republic of Bashkortostan
3.1
2.8
1.9
1.6
2.80
Kursk Region
2.6
0.8
0.5
0.49
0.45
Volgograd Region
2.6
1.7
1.1
1.2
1.87
Saratov Region
2.6
1.7
0.9
0.9
0.79
Altai Krai
2.5
1.6
0.7
0.5
0.80
Tambov Region
2.2
0.7
0.4
0.00
0.35
Orenburg Region 2.2
1.3
1.1
1.1
0.91
Lipetsk Region
0.8
0.4
0.04
1.62
2.0
Source: [4]
3 Results Currently, the Central Federal District (25.5%), the Privolzhsky District (23.3%), the Southern Federal District (17.4%), and the Siberian Federal District (11.3%) are leading in agricultural production in the main socio-economic indicators. Russian entities with the most favorable agro-climatic resources for agricultural activity are located in the abovementioned macroregions. They provide the most effective conditions for agriculture [8] and ensure the food security of the country. The leading territorial subjects of the Central Federal District are the Belgorod, Kursk, Lipetsk, and Tambov Regions. Their contribution to agricultural, crop, and livestock production is closely proportional. The Belgorod Region excels in livestock production with the highest share (6.3% of Russian livestock production). The leading territorial subjects of the Privolzhsky District are The Republic of Tatarstan (4.6%), The Republic of Bashkortostan (3.1%), the Saratov (2.6%), and Orenburg (2.2%) Regions. The Republic of Tatarstan is noted for a high level of development in crop and livestock production (4.6%, respectively). The strong production potential of Central and Privolzhsky Districts determines the development of the agricultural sector [1]. The Krasnodar Krai is considered as the absolute leader not only within the macroregion of the Southern Federal District, but entire Russia. Its contribution
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amounts to 7.1% in agricultural production, 10% in crop production, and 4.2% in livestock production. The Rostov Region takes the next spot on the list with a 5.0% contribution in crop production, second only to the Krasnodar Krai (6.8%). The Volgograd region is a large developing agricultural area (2.6%) with a notable contribution to crop production (3.6%). The Altai Krai remains a traditional leader of the Siberian Federal District. Its contribution to agricultural production amounts to 2.2% (2.7% in crop production; 2.3% in livestock production). Thus, we can note that 12 regions have a significant contribution to the development of agriculture and, consequently, the AIC of the country. All the regions mentioned above are located in the zone of moderate latitudes that provide favorable agro-climatic conditions. Thus, the study focuses on the contribution of these regions to the development of agriculture and the economy of the country as a whole. The index of industrial agricultural production indicates the current state of production. In 2018, this index amounted to 99.4% in all farm categories in the country. Seven of the leading regions were included in the group of downward index trend. The most notable decline in agricultural production occurred in the Orenburg region (89.5%). Based on that indicator, the sustainable agricultural regions include the Lipetsk region (106.7%), the Belgorod region (104.2%), the Altai Krai (102.5%), the Kursk region (101.0%), and the Tambov region (100.3%). A distinctive feature of the leading agricultural regions is the special structure of products by category of farms. Large agricultural organizations can take up the share from 52.4% (Altai Krai) up to 86.5% (Belgorod region) in half of those regions. The share of such organizations in the other half of the regions is much smaller, with a maximum of 46.2% in the Rostov region and a minimum of 29.8% in the Orenburg region. Peasant farms dominate these regions with the maximum share recorded in the Orenburg region (54%). Moreover, half of the leading constituent entities have a large share of farm enterprises and individual entrepreneurs (from 11.5% to 27.9%) due to the favorable agro-climatic conditions and traditional historical disposition of the population towards individual entrepreneurial work. Russian agricultural structure is marked with a slight predominance of crop production, which accounts for 50.2%, whereas livestock production share amounts to 49.8%. This corresponds to the natural and climatic conditions, the features of soils and terrain suitable for a particular agricultural activity, and a favorable food supply for the development of livestock [7]. As for the regions of developed crop production, most of them show results surpassing the national average in 8 out of 12 cases. For example, the Krasnodar Krai (70.9%), the Rostov Region (68.1%), and the Volgograd Region (68%) take the leading positions in the total share of agricultural production. This is due to a substantial role of large agro-industrial companies located on their territory. These regions produce such essential products as grain and sunflower seeds for the production of vegetable oil. Households in the region produce potato and vegetable crops. The share of farms and individual entrepreneurs are particularly high in ten regions, with a share from 85.3% in the Saratov Region up to 94.8% in the Kursk Region.
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However, the development of livestock production is not marked with similar uniform distribution. The manufacture of livestock products by farms of all categories reaches 50%, with only four territorial subjects exceeding that percentage. Among them are the Belgorod Region, the Republic of Bashkortostan, the Republic of Tatarstan, and the Orenburg Region, with large organizations concentrating in only three of them. At the same time, household farming enterprises that tend to specialize in cattle breeding and further sell play a significant role in all the mentioned regions excluding the Belgorod Region. A particularly high share in livestock production is observed in households of the Altai Krai (70.5%), the Republic of Bashkortostan (68.9%), the Orenburg Region (68.7%), and the Saratov Region (62.6%). The preferences of the population in these regions are associated with various factors like the availability of a favorable forage base for the development of cattle breeding and high product demand. Livestock production is considered a socially important industry in the Altai Krai. Dairy and beef cattle breeding, horse breeding, sheep breeding, antler reindeer husbandry, and poultry and cattle breeding are developed in the region. In the Republic of Bashkortostan, cattle, sheep, goat, and pig breeding are traditional branches with notable positive development trends recorded in all of them.
4 Discussion The analysis of fixed capital investments that are considered one of the most important agricultural development indicators shows the strategic priorities of the state in the development of the agricultural sector. Table 4 shows the share of state investment in the total funds invested in the region. Investment in the fixed assets of agricultural sector is essential for the regions that traditionally specialize in the development of the agricultural sector (Table 2). These are territories of the Central Black Earth Region and the southern part of Western Siberia. In other regions, in addition to agriculture, the state invests in metallurgy (Belgorod Region and Lipetsk Region), mechanical engineering (Volgograd Region and Saratov Region), petrochemical industry (the Republics of Bashkortostan and Tatarstan), and more [2]. While assessing the performance of agricultural enterprises in leading agricultural regions, we use an indicator of financial results showing a profit or loss at the end of the reporting year. Thus, it can be noted that the main financial results of crop production enterprises in Russia as a whole and within the studied leading regions show positive dynamics (profit growth by a factor of 7) for 2005–2017. The Krasnodar Krai shows particularly notable results, with 6.5 times increased profits. There are no examples of wasteful production in any of the studied regions. However, the minimum amount of profit is typical for enterprises located in the Orenburg region (48 million rubles). Nevertheless, livestock production shows different results. Three entities had losses by the end of 2017. These are the Rostov Region, the Orenburg Region, and
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Table 2 Investment in agriculture, 2017 (excluding small business entities) Regions
Total, (million rubles)
Agriculture, forest management, hunting, fishing and fish breeding, (million rubles)
The share of investments in agriculture, forest management, hunting, fish breeding, and fishing, %
Kursk Region
78,907.2
16,786.3
21.3
Tambov Region
69,685.7
14,119.1
20.3
Belgorod Region
82,846.9
15,941.3
19.2
Lipetsk Region
86,785.1
15,814.9
18.2
Altai Krai
48,555.8
5,842.5
12.0
Krasnodar Krai
391,852.0
28,105.5
7.2
Volgograd Region 144,153.5
8,140.3
5.6
Saratov Region
89,682.6
4,430.8
5.0
The Republic of Bashkortostan
179,138.2
7,918.6
4.4
Rostov Region
233,619.0
9,871.9
4.2
The Republic of Tatarstan
351,567.0
14,295.5
4.1
Orenburg Region
135,807.3
2,741.7
2.0
Source: [4]
the Republic of Bashkortostan, even though they had profits in previous years. The most successful livestock enterprises operate in the Belgorod Region (profit growth by a factor of 10), the Kursk, Lipetsk, and Tambov Regions, and the Altai Krai. It should be noted that the enterprises of the industry are subsidized. This fact corresponds to the main objectives of the state policy for the development of import substitution [14]. Several objective factors reduce the economic effect on agriculture. These include the significant dependence of crop production on the temperature during the growth and maturation of crops and the limited cultivated land area. It is almost impossible to influence the first factor. However, the second one is currently under the control of the Ministry of Agriculture of the Russian Federation. The Ministry considers the increase of total cultivated acreage to be a task of high priority for the development of the agricultural sector. The profitability of enterprises is another target indicator of regional agricultural development. It is calculated as the ratio between the value of the balanced sale-based financial result and the cost of products sold. It is worth mentioning the positive dynamics of profitability during 2005–2017. Moreover, the most significant increase in profit belongs to crop production (by almost 11%), with a lesser increase (by 2.5%) in livestock production. To identify the most prosperous regions, the scholars present their typological classification based on the profitability in two areas of agriculture (Table 3).
Regional Features of Agricultural Development in Russia Table 3 Typological classification of the regions by the profitability of products produced and sold by organizations of the agricultural sector, 2017, %
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Regions
Organizations Regions of crop Production
Organizations of livestock production
The Russian Federation
17.2
The Russian Federation
12.0
Krasnodar Krai
31.7
Kursk Region
40.5
Saratov Region
28.8
Belgorod Region
23.5
Volgograd Region
28.1
Lipetsk Region
20.3
Rostov Region
22.4
Tambov Region
16.8
Altai Krai
20.0
Krasnodar Krai
14.6
Kursk Region
18.6
Altai Krai
11.8
Lipetsk Region
15.7
Saratov Region
7.3
Belgorod Region
11.4
Orenburg Region
6.4
Tambov Region
13.3
The Republic of Tatarstan
5.9
The Republic of Tatarstan
9.8
Volgograd Region
5.0
The Republic of Bashkortostan
0.8
The Republic of Bashkortostan
3.6
Orenburg Region
−0.3
Rostov Region
−5.6
Source: [4]
The data on the profitability of agricultural organizations indicates that the average Russian indicator is exceeded in half of the territorial subjects, both in crop production and in animal husbandry. High profitability is correlated with the financial results of enterprises and their traditional specialization in competitive products. Therefore, the negative profitability in the Orenburg Region and the Rostov Region show their focus on the priority sector of agriculture that suits their natural and climatic conditions. Russia regains its status as an agricultural export country that provides food security and living conditions. Regulatory instruments provide the supervision of activities in the Russian agricultural sector. These include the Federal law “On the Development of Agriculture” [10]. The state development program for 2013–2020, developed by the Ministry of Agriculture of the Russian Federation, is currently in effect. It contains information about current and plans, projects, and regulations. It includes subsidies and
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loans issued to agriculture. State grants and preferential loans allow for enterprise modernization. The main goals are focused on the increase of food independence of Russia, the competitiveness of domestically manufactured products in the domestic and foreign markets, the financial stability of agricultural enterprises, and the further development of enterprises in rural areas.
5 Conclusion The development of agriculture in Russia has a significant regional specificity consisting of its localization in a small number of territorial subjects with the most favorable agro-climatic conditions. Nevertheless, these regions successfully develop particular fields of activity and ensure the food security of Russia. Large organizations have a high share in agricultural production (from 86.5% in the Belgorod Region to 52.4% in the Altai Krai). They are especially prevalent in crop production. The Krasnodar Krai (70.9%), the Rostov Region (68.1%), and the Volgograd Region (68%) are the current leaders among the regions with a focus on crop production. A significant role in the livestock industry is played by households, which is particularly noticeable in the Altai Krai (70.5%), the Republic of Bashkortostan (68.9%), the Orenburg Region (68.7%), and the Saratov Region (62.6%). Enterprises and organizations engaged in crop production are more efficient, which is confirmed by the financial results for the period 2005–2017 (profit growth by a factor of 7). The most successful enterprises in the livestock sector operate in the Belgorod Region (profit growth by a factor of 10), the Kursk, Lipetsk, and Tambov Regions, and the Altai Krai. Thus, most of the regions leading in agricultural production have high profitability and positive dynamics of financial results. Their activity is considered strategically important. The companies receive state support through investments, subsidies, and concessional lending developed in legislative documents.
References 1. Arkhipova LS, Gorokhova IV, Demenko OG (2019) Comparative assessment of the Russian macroregions’ production potential. Evaluación comparativa del potencial de producción de las rusas macrorregiones. Espacios 40(20):16 2. Bogoviz AV, Ragulina JV, Barcho MK (2019) Influence of innovations on regional socioeconomic development. In: Popkova E (ed) The future of the global financial system: downfall or harmony. ISC 2018. Lecture notes in networks and systems, vol 57. Springer, Cham, pp 1200–1207 3. Bogoviz AV, Semenova EI, Alekseev AN (2018) New challenges for regional economy at the modern stage. In: Popkova E (ed) The impact of information on modern humans. HOSMC 2017. Advances in intelligent systems and computing, vol 622. Springer, Cham, pp 574–580
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4. Federal State Statistics Service2018a) Regions of Russia. Socio-economic indicators. www. gks.ru 5. Federal State Statistics Service (2018b) Rural territories of the Russian Federation. https:// www.gks.ru/free_doc/new_site/region_stat/sel-terr/sel-terr.html. 6. Gagarina GY, Chaynikova LN, Arkhipova LS (2018) The analysis of the sustainability of the socio-economic development of Russian regions. Federalism 1(89):104–121 7. Krasilnikova LE (2019) Spatial and sectoral development of the region based on the development of agro-industrial territorial and supply chain management in economic systems. Int J Supply Chain Manag 8(4):834–844 8. Nikitin A, Kuzicheva N, Karamnova N (2019) Establishing efficient conditions for agriculture development. Int J Recent Technol Eng 8(2):1–6 9. Ovchinnikov VN, Ketova NP, Lysochenko AA (2014) Greening of agricultural nature management – the imperative of food security. J Econom Regul 5(2):105–114 10. Presidential Executive Office (2006) Federal Law “On the Development of Agriculture”, 29 December 2006 (No. 264-FL). Moscow, Russia 11. Presidential Executive Office (2010) Decree of the President of the Russian Federation “On approval of the Doctrine of food security of the Russian Federation” 30 January 2010 (No. 120). Moscow, Russia 12. Savchenko IV (2019) Conservation agriculture in high-quality food production. Her Russ Acad Sci 89(2):201–205 13. Sedova NV, Ananiev MA (2018) The effect of Russia’s in progress import substitution strategy on its agri-food security. Espacios 39(45):1–8 14. Sedova NV, Ananiev MA, Efimov IV (2018) Strategic planning of the agribusiness development in the conditions of import substitution. Utopia Y Praxis Latinoamericana 23(82):252–260
Innovations and Perspective Technologies in the Potato and Vegetable Subcomplex of the Agro-Industrial Complex in Russia Sergey V. Zhevora , Vladimir V. Tulcheev , and Maxim Yu. Borisov
Abstract The development of the state information support system in agriculture, regulated by the Federal Law “On the Development of Agriculture” (December 29, 2006 No. 264), requires refinement in the formation of the Russian agro-industrial complex (which now consists of 3 areas) as a whole. The digitalization of the AIC is necessary to increase the efficiency and sustainability of agricultural production, to manage it as a single cycle at all levels, including modern unified processes of production, storage, processing, and wholesale and retail trade to predict possible changes in managed food and non-food subcomplexes taking into account the development of exports. Currently, in Russia, information resources activating the digitalization of many technological processes and areas of activity are widely spread. The information system is a set of interconnected tools, methods, and personnel used to store, process, and issue information essential to management development. The digital platform is an integrated information system ensuring the reduction of transaction costs, optimization of business processes, and growth of agricultural product distribution in the “field (farm)—consumer” system. This platform allows to remotely control the quantity and quality of the product at any stage of the movement of the “field (farm)—consumer” system. It is possible to establish the interaction of enterprises and industries of food subcomplexes with federal executive bodies. A large amount of information for the analysis, planning, and forecasting activities of the AIC will allow to timely solve the problems impeding the development of agricultural production in the country. Keywords Agribusiness · Potato and vegetable subcomplex · Cooperation · Agro-industrial integration · Digitalization · Competitiveness · World market
S. V. Zhevora · V. V. Tulcheev (B) Lorch Potato Research Institute, Kraskovo, Russia M. Yu. Borisov Russian State Agrarian Correspondence University, Balashiha, Russia e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_9
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1 Introduction According to the program of the Government of the Russian Federation, the digital economy involves the gradual implementation of technologies in our daily routine. Nowadays, digital information covers all areas of human activity, including politics, management, resource production (including agricultural resources and their dissemination), construction of national-economy complexes (including their resource resupply), science, education, medicine, culture, art, etc. This process aims to meet the demand of the population (as well as other subjects) for human interaction through the use of the Internet, new information technologies, and telecommunications. The transition to a digital economy is taking place simultaneously with global economic integration [6]. To solve the problems of training personnel to work in new conditions, carry out institutional reform, improve the legislation, and perform other essential tasks, in 2017, the Russian Government developed and implemented several measures, including the program “Digital Economy of the Russian Federation” [2] and “The development of the information society in the Russian Federation for 2017–2020”[5].
2 Materials and Methods The research was carried out using methods of systematic, structural, and comparative analysis. The study relies on the multifaceted and balanced approach to the proportional development of the AIC and its potato and vegetable sub-complex. It also relies on a dialectical logic based on the interests of all technologically interconnected enterprises and industries committed to the final product.
3 Results The development of technology is directly related to human development. Technologies ensure the continuous advancement of our planet. New institutions, tools, and methods perpetually replace outdated ones. The digital economy, the Fourth industrial revolution, the latest technological paradigm, and other similar events continuously dismantle previous functional models of socio-economic systems up to a global level. This process reveals the immense human resources of the population. With the help of software, the machine can continuously perform most of the ordinary tasks without errors. Ultimately, the introduction of “smart” industries threatens to increase inequality within national economies. This process can also have other far-reaching consequences [7]. Following the Decree of the President of the Russian Federation “On the National Goals and Strategic Tasks of the Development of the Russian Federation for the
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Period up to 2024” (May 7, 2018 No. 204), there is a particular emphasis on such components of agricultural policy as cooperation, competition, money, and management systems. These components are the basis for technological and socioeconomic breakthroughs, including breakthroughs in the AIC and agriculture as its main component. This includes more than 140 agriculture-affiliated industries, with 60 involved in the processing of agricultural supplies and 80 (up to 100 in developed countries) industries serving as resource providers. Nowadays, up to 93%–95% of total open-ground potato and vegetable production is concentrated in small farms [SF], which include personal farms [PF], privateowned farms [POF] and small agricultural organizations [SAO]. Its storage and processing are concentrated in cities located hundreds or thousands of kilometers away from raw-material zones, using dozens of different nonprofessional patterns and physical distribution systems. It is almost impossible to digitize this production, considering the number of intermediaries, resellers, and speculators involved. The digital economy implies maximum automation of enterprise processes and interaction with external contractors (suppliers, etc.) tied to the final product. The goal of the digital economy is to get rid of unproductive links. The creation of agro-industrial formations [AIF] of cooperative and collective types (agricultural production and trade cooperatives [APTC], agricultural and industrial enterprises [AIE], and agricultural and industrial associations [AIA]) equipped with mechanized and automated warehouses is a priority task. Those formations will significantly increase the productivity and quality of the final product with higher added value and increase the competitiveness and quality of life of rural and urban populations. Specialized APTC is created based on SF with its own wholesale and retail trade (various convenience stores). The agro-industrial enterprises (such as CJSC “Ozyory” of the Ozyorsky district that sells the cheapest potato products in the world) and associations (such as “Dmitrov Vegetables” of the Moscow Region) that sell purified and vacuum processed products of the so-called “borscht set” are created based on medium and large SAOs. The creation of innovative AIC is impossible without the construction of highly mechanized and automated storage systems within waste-free APTC, AIE, and AIA. These systems should be based on unified digitalized processing chains of closedcycle production of the final agricultural products. This process should focus and concentrate 80%–90% of all resources and labor costs under unified management in every aspect of production, from the segregation of harvested crops to the output of final products. Soon, the development of science, production, and business cover technologies of the closed production cycle in seed breeding and commodity production under the so-called principle “from the field and into the pan.” According to this principle, the consumer receives fresh, semi-finished, or ready-to-use potato products (dried, fried, frozen, canned, etc.) with subsequent standardization and digitalization of unified waste-free general processing chains. The current quality of the produced seed potatoes leaves much to be desired. Out of 800–900 tonnes of total seed grain, low-grade seeds take up 33%. According
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to the Ministry of Agriculture of the Russian Federation, only 14% of the total volume of seeds is certified by the Russian Agricultural Center, which seriously affects the quality of the harvest. The Federal Government information system “Seed Production” developed by the Ministry of Agriculture of the Russian Federation, allows getting instant access to all the necessary information about the quality of each seed batch. This system should be fully operational from the beginning of 2020. The seed producers that join the system will receive state support (subsidies, soft loans, etc.), which will seriously affect the positions of the gray seed market. It currently takes up 82% of the total market. According to the Ministry of Agriculture of the Russian Federation, in 2018, 146 thousand tons (18%) of the planted tubers were certified out of the total weight of 800 thousand tonnes [4]. Currently, the Federal Government information system “Seed Production” must be integrated into the production, storage, and processing of agricultural products in the AIC. A single narrowly focused seed service will not solve the various problems of the AIC. Modern technologies significantly affect the production of agricultural products, establishing the automation of harvesting, storage, processing, and sale, and the quality of life of the individual. Thanks to the Global Navigation Satellite System (“GLONASS”), drones, etc., we can observe the state of fields and crops while taking the necessary measures, including the control of diseases and pests, irrigation management (with the usage of necessary fertilizers and nutrient elements), etc. Information systems play an essential role in the economy, reducing labor and funds involved in the production of competitive agricultural products on the world market, while also helping to resolve various global problems, including food supply problems. Digital transformation affects management on all levels (including management of the agricultural sector), new business methods, and farming forms. An example of digital transformation is the activity of specialized seed and commercial potato production-oriented APTC (“Ustyuzhensky seed potatoes,” “Bryansk Guild of potato growers and potato processors,” “Ozyory” CJSC, Agro-industrial association “Dmitrov Vegetables”). Their activity is easy to digitize as a single technological process. Information systems change everyday routines, including paperwork, purchase of goods and services, and can guide innovative development of Russia, the Common agricultural market of the EEU, CIS, BRICS, SCO, and APEC member countries, and the entire world. The widespread adoption of digital technologies in various economic sectors (agro-industrial, fuel-and-energy, defense, housing, and utility sectors) and other national-economy complexes, within the so-called “from field to consumer” system, radically affects our lives. Digital technologies are currently used in crop harvesting, oil, gas, metal, and ore production, and in various minor aspects of human life. All the unified technological resource-saving chains need to be automated and digitized shortly. The use of modern digital technology allows creating optimal soil, agronomic, and technological conditions within the APTCs, AIEs, and AIAs. These will allow for a significant increase in the productivity of fields and farms, growth of labor
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productivity within the so-called “from field to consumer” system, and a general cost reduction per unit of a final agricultural product that reaches retail distribution or the consumer. The digitalization of agriculture and AIC is a national task of integrated and sustainable development of rural areas. This development should consider their natural and climatic, soil, and economic conditions, the spatial development of the country (with over 400 zones and subzones), to deepen the specialization of agroindustrial production in APTCs, AIEs, and AIAs. It should also help to establish a highly mechanized and automated material and technical base for storage, processing, and transportation of perishable products using the specialized road, rail, and marine refrigerated transport equipped with the necessary automated temperature, humidity, and ventilation systems. In turn, highly profitable waste-free APTCs, AIEs, and AIAs, with broad access to effective technologies, including information technologies, will support small-scale PFs, POFs, and minor SAOs that are currently on the verge of cost recovery and still use outdated equipment and technologies. The digitalization of agriculture as a sphere of production and agricultural product circulation, as well as the digitalization of its machinery, equipment, etc., is hindered by the lack of standardization of harvesting, storage, processing and sale of agricultural products within APTCs, AIEs, and AIAs, general patterns of a commodity movement, and the real costs of labor and funds in the technologically disrupted system “from field to consumer,” which concentrated up to 90% of all costs per unit of final food products: • National and interstate information systems within the EAEU member countries allowing for tracking the quantity and quality of agricultural products in the system “from field to consumer”; • Long-term forecasting, planning, and rational use of agricultural land, including arable land, suitable for an expansion of agricultural production; • Reliable information on the origin of seed material, crop protection products, and other chemicals to ensure the food safety of sold agricultural products; • The desired number of IT-specialists working in the agricultural sector. According to experts and the Ministry of Agriculture, in Russia, the number of ITspecialists working in agriculture is two times lower than that in developed countries. This shortage roughly amounts to 90 thousand IT-specialists [1]. This creates a demand (primarily among APTCs, AIEs, and AIAs) for multifunctional specialists with an inter-branch education that cannot be provided by Russian universities. Meanwhile, the role of education in digital literacy and training of highly qualified multifunctional specialists is essential for the Russian Federation. It will allow the country to take its place among the world’s most developed countries and acquire a leading position in the “smart” global economy. Currently, there is a demand for engineer-economists, technologist-economists, agri-marketing specialists, etc. that will create added value, reduce excess labor, and automate the technological processes in regions with the lack thereof. At the same
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time, inter-branch education helps develop the economy of the country at a much higher rate. Complex automation and robotization of Russian agriculture give impetus to fundamental changes in 60 industries processing raw agricultural materials and 80 industrial sectors supplying Russian agriculture with all possible resources, including agricultural machinery. This machinery is fully prepared to introduce digital agriculture, providing optimization of production processes using drones, sensors, and satellites. They will ensure a high quality of the harvest of open-ground crops by self-propelled combine harvesters, the shortest crop delivery utilizing heavy haul vehicles (equipped with 30 tons of trailer weight) to automated storage units. All sorting, processing, packing, and vehicle loading are carried out within these units without any human input. For a long time, various ministries and departments of the Russian Federation publicly criticized the unified technological system “from field to consumer.” The system was also criticized by other organizations (trust of restaurants and canteens, department of labor supply, and so on), which continued to build their storage units, processing sites, and fruit-and-vegetable bases. As a result, more than 50% of the harvested crops did not reach the consumer. This problem is yet to be resolved. Half of the population in the country cleaned potatoes, vegetables, etc. manually. The second half of the citizens of the Soviet Union were involved in manual sorting of rotten fruit-and-vegetable products that appeared due to unnecessary transshipments, overload, and 60%–80% damage to perishable products consisting of 80%–90% water. However, the harvesting plan was followed without fail, including the procedure of potato seeds delivery, even though farmers usually refused to carry out the delivery even under a threat of starvation. Potatoes were delivered back to the farm for planting unknown cultivars and generations. If the delivery of potatoes and open-ground vegetables occurs in July and does not undergo sorting procedures, this technology belongs to the first technological paradigm. Automated sorting and packing of the “borscht set” belongs to the second and third technological revolution, while its processing belongs to the fourth revolution. Full automation of a unified technological process within storage facilities helps to establish organizational, technological, managerial, and socio-economic unity. It also causes an explosive growth of productive labor within the AIF and the AIC as a whole, since the assessment of each cooperation partner will depend on the quantity and quality of labor input in the production of final goods that are sold to consumers at the lowest labor and resource costs. According to the Ministry of Agriculture of the Russian Federation, in 2017, the volume of crop production amounted to 3 trillion rubles. With the implementation of digital technologies, the volume would increase by 194 billion rubles and bring up to 361 billion rubles in combined efforts with livestock production. However, the Russian agricultural sector lacks qualified IT-specialists, which account for one in 1,000 of the total number of specialists employed in agriculture. Russian agriculture requires 90,000 IT-specialists to achieve indicators of the United States, Germany, and others. In 10 years, Russia will lack 2 million IT-specialists, since the educational institutions of the country produce only 60,000 of such specialists per year. It will
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take 33 years to eliminate the personnel crisis and maintain the domestic digital economy. With an estimated salary of 83–500 thousand rubles, they will most likely seek employment in other countries instead of local rural regions. However, the AIC has other problems that need to be resolved. Of all technology used in the agricultural sector, 95% are foreign-made. Underfunding of agriculture is the leading cause of technological inferiority not only in agriculture, storage, and processing of sold agricultural products but also in 80 manufacturing sectors supplying the rural region [3]. Russia is still up to date in the IT-theory field but lacks in the implementation of ITtheory within the agricultural sector. Thus, it is necessary to create plant and livestock production-oriented APTCs, AIEs, and AIAs in all Russian regions. A road map for the digitization of the AIC and its subcomplexes, as well as a plan for the creation of automated storage systems (including rail side storage systems), livestock farms with a unified closed production cycle of final agricultural products (semi-finished products and ready-to-eat food), are also an essential part of the process.
4 Discussion The biotechnological digital revolution based on the development of new technologies in genetics, breeding, biochemistry, biology, microbiology, microelectronics, unified waste-free processing chains in the system “from field to consumer,” etc. help to avoid the negative consequences associated with traditional 50–60-year-old forms of soil-management like water and environment pollution, etc. The implementation of resource-efficient waste-free bioshield technologies within the AIC will increase the efficiency of fields and farms, profitability, and the quality of life of the population. It is necessary to get rid of the currently practiced patterns of high-cost distribution that involve various intermediary participants in favor of more direct marketing schemes that will not result in a 50% loss of the total harvest volume. Finally, it is necessary to discuss and adopt the so-called “general” systems involving the use of the specialized road, rail, and marine refrigerated transport for the circulation of perishable agricultural products to consumers in Russia, as well as EEU, CIS, SCO, and BRICS member countries on both federal and interstate levels.
5 Conclusion The mass creation of vertically integrated waste-free APTCs, AIEs, and AIAs based on small, medium, and large PF and POF equipped with highly mechanized and automated storage complexes (including rail side storage complexes) in all 83 agricultural regions of Russia will allow for explosive development in the AIC. It will allow
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Russia to move away from traditional agricultural activities like potato and openground vegetable breeding and momentarily reach the current agricultural production indicator in developed countries with considerable competitive advantages in agricultural products. Besides, if Russia will adopt the APTC-oriented “Scandinavian” development plan, then it will allow the country to “jump over” the 100– 200-year experience of western farming and the cooperative movement, including the domestic pre-revolutionary experience, when Russia had leading positions in the creation of agricultural cooperatives and the number of shareholders in them. Ecologically clean land, renewable freshwater (Russia is the second biggest country in terms of renewable fresh waters resources), domestically produced mineral fertilizers, and full involvement of domestic metallurgy to produce domestic agricultural machines, special transport, warehouse, and processing equipment, etc., can help rural territories with abundant metal resources (bypassing the central territories of the country) to fully cover the needs of agricultural, rural territories out of a deep crisis and help them on their pass through a crisis. At the same time, Russia can cover the food demand of its citizens, while also exporting food products to the population of the EEU, CIS, SCO, BRICS, and ASEAN member countries.
References 1. Arkhipov AG, Kosogor SN, Motorin OA (2019) Digital transformation of Russian agriculture. FGBNU Rosinformagroteh, Moscow 2. Government of the Russian Federation (2017) Resolution of the Government of the Russian Federation “Digital Economy of the Russian Federation”, 28 July 2017 (No. 1632). Moscow, Russia. 3. IT specialists do not rush into the village (2018) Rural life 40, 15 4. Krasilnikov A (2019) A brief overview of the situation in the industry. Potato Syst 3:10–12 5. Presidential Executive Office (2017) The Decree “On the Strategy for the Development of the Information Society in the Russian Federation for 2017–2030”, 9 May 2017 (No. 203). Moscow, Russia. 6. Russian News Agency TASS (2017) The fourth industrial revolution, as an incentive for global competitiveness. https://tass.ru/pmef-2017/articles/4277607 7. Schwab K (2017) Fourth Industrial Revolution. Eksmo, Moscow
Reducing the Risk of Diversified Agricultural Production by Optimizing the Production Structure Marina O. Sannikova
and Ekaterina A. Markelova
Abstract The study explores the possibilities of reducing the production risk of agricultural manufacturers by diversifying the production of crop products. Modeling using quadratic programming served as the primary mathematical tool of the research. The study was based on the specific territory of the Saratov Region, with homogeneous weather, climate, and economic conditions. To assess the possible effect of diversification, we obtained variants of the structure of the sown area with different levels of risk that are optimal for maximizing the expected cost of agricultural products. Based on the generated scenarios, we concluded that optimal risk diversification has specific prospects within Russian agricultural production. However, while implementing optimal risk diversification, it is necessary to simultaneously use tactical risk management methods, follow crop cultivation technologies, and ensure the lasting quality of used resources. Keywords Production risk · Diversification · Crop production · Quadratic programming
1 Introduction Despite the increasing technical, technological, and organizational level of agricultural activity and the growth of production in Russia, the stabilization of production remains a relevant problem. It largely depends on the ability of manufacturers to protect themselves from endogenous and exogenous risks. Currently, risk protection tools are not widely spread in domestic agriculture, negatively affecting the stability of production results and the balance of the reproduction process. There is an urgent need to introduce entirely new tools and further improve those already in use, including the diversification of the production structure of agricultural manufacturers.
M. O. Sannikova (B) · E. A. Markelova Saratov State Vavilov Agrarian University, Saratov, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_10
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M. O. Sannikova and E. A. Markelova
In the pre-reform period, in relatively deterministic economic conditions, the diversification of production did not have the functions of protection against production or market risks. The diversified nature of agricultural manufacturers was caused by the relatively large farms that allowed for the production of multiple products supported by government authorities through planning. Other factors include the close connection of livestock production with the feed base, which was provided mainly through domestic production, and the mandatory requirements for crop rotation based on a diverse set of crops for farming systems in current use. These factors determined the presence of several types of livestock and crop products in the production structure of any economy. In the changing business environment with high market risks and insufficient dissemination of the practice of transferring production risks, the diversification of agricultural production can become one of the tools to reduce these types of risks. Diversification may involve a combination of traditional industries for a given manufacturer or territory and the organization of less common or niche products (aquacultures, bee products, organic products, etc.). Diversification has a high potential to increase the productivity and efficiency of the economy as a whole, including increasing synergistic processes and reducing the overall risk of management through compensatory mechanisms. In general, diversification can lead to the growth and stabilization of agricultural performance [4]. The inclusion of activities, which results have a negative or weak positive correlation with each other, serves as the basic principle behind any diversification plan. The total risk, including that of an agricultural enterprise, is measured by the sum of its result variances in each activity and the covariance among them [6]. Therefore, if the covariance of results from two activities is negative, then the volatility or risk of the cumulative result will be lower. Thus, a smaller result of one activity is likely to be offset by a higher result of another. Following the Markowitz theory (portfolio theory), concerning agriculture, the combination of industry and manufacture of certain types of products should maximize the expected result under the conditions of a given level of risk, which is expressed in the amount of variance of this result (it is possible to set an inverse problem that minimizes the variance for a given value of the result). It should be noted that the increase in the overall result of diversified production will also boost the growth of risk or variance. It is possible to solve the problem of optimizing the production structure using quadratic programming, while the acceptable level of risk or variance is set following the preferences of a particular manufacturer. Quadratic programming was widely used in planning and studying the effectiveness of agricultural diversification since the middle of the twentieth century [5, 7, 8]. However, its tools are rarely used in Russian research, despite the high value of its results. Thus, with the relevance of increasing the sustainability of domestic agriculture to internal and external threats, this work aims to assess the potential for reducing the risk of diversified agricultural production based on the optimization of the production structure using quadratic mathematical programming. The study was conducted on
Reducing the Risk of Diversified Agricultural Production …
75
the example of a separate territory of the Saratov region marked with stable weather and climatic conditions, with a predominance of crop production.
2 Materials and Methods As noted above, quadratic programming or risk optimization based on the minimization of variance of the production results allows us to generate solutions based on both the target value of the model and the value of its variance [2]. The variance of the production result in models of this type serves as a measure of risk, with the limit of its value set under the maximum permissible level of risk, which affects the resulting optimal solution and the target indicator, accordingly. The matrix notation of the problem based on [3] is as follows: E = c x → max Ax ≤b x Qx = V, V − variable value x ≥ 0,
(1)
where E—the expected result from the manufacture of agricultural products; c = {c1 , c2 , ..., cn }—a row vector of objective function coefficients; x = {x1 , x2 , ..., xn }—a column vector of variables, A—m × n matrix of techno-economic factors ai j – cost of the i resource (i = 1, 2,…,m) per unit of the j type of activity (j = 1, 2,…, n); b = {b1 , b2 , ..., bm }—a column vector of free terms of restrictions; Q—covariance matrix of production results from j activities of dimension n × n; V —the variance of the obtained solution. The coefficient vector of the objective function is defined as follows: c = pC,
(2)
where p = { p1 , p2 , ..., ps }—a row probability vector of k outcome (k = 1, 2,…, s); C—dimension matrix of s × n of the expected results ck j from the production of the j activity under the k implementation output of the random parameters [9]. In our case, the coefficients of the objective function represent the mathematical expectations of results from the production of the j type of activity: cj =
s
ck j pk
(3)
k=1
For this research, we will take the total market value of products obtained from the cultivation of crops as a result of agricultural production. Thus: ck j = yk j · e j ,
(4)
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M. O. Sannikova and E. A. Markelova
where yk j —the output of product per area unit of j type in the implementation of the k result; e j —the selling price per unit of the product of j type. It should be noted that: Q = D (P D),
(5)
where D = C − uc—the matrix of absolute deviation ck j from the corresponding average values for outcomes with dimension s × n; u—the unit vector with dimension s × 1; P—the diagonal probability matrix of the outcomes with dimension s × s; D the transposed matrix of D. The research was conducted on the example of agricultural manufacturers in the Kalininsky District of the Saratov Region. The object was chosen due to the relatively homogeneous natural, climatic, and economic conditions within the district, and the presence of a rather large number of manufacturers with developed crop production. This allows us to speak about the statistical significance of the obtained results and their applicability throughout the district. The feasibility of the inclusion of farms from other districts of the region in the study is debatable due to differences in natural and climatic conditions, which vary from moderately to extremely arid within the boundaries of the Saratov Region. In the Kalininsky District, crop production is mainly represented by a wide range of grains, including grain, maize, and sunflower. Statistical characteristics of their yield for the period of 2001–2018 are presented in Table 1. To determine the value of products manufactured under the Formula (4) and to ensure the comparability of indicators for different periods, we used the average sale prices for the Saratov Region of 2018, and the size of cultivation areas allocated to grain and oil crops in the Kalininsky District as of 2018 (Table 2). Table 1 Statistical characteristics of crop yields in the Kalininsky District of the Saratov region for the period of 2001–2018 Value
Winter wheat
Winter rye
Spring wheat
Spring barley
Millet
Minimum value, c/ha
3.82
The average value, c/ha
9.43
0.12
3.82
1.59
0.06
0.75
12.00
5.41
x
21.90
19.84
15.00
14.93
11.96
8.33
15.51
46.44
11.52
x
Maximum value, c/ha
37.77
31.47
24.14
29.48
24.16
13.46
25.18
149.14
18.81
x
Average quadratic deviation, c/ha
9.08
5.87
5.38
5.96
5.79
3.68
6.00
30.54
3.46
x
Coefficient of variation
0.41
0.36
0.40
0.48
0.44
0.39
0.66
0.30
x
0.30
Source Calculated by the authors based on [1]
Buckwheat
Oat
Grain maize
Grain sunflower
Subtotal
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Table 2 Model formation data for the optimization of crop acreage (2018) Value
Winter wheat
Winter rye
Spring wheat
Spring barley
Millet
Buckwheat
Oat
Grain maize
Grain sunflower
Subtotal
The sale price for one center on average in the Saratov Region, thousand rubles
0.770
0.561
0.770
0.738
1.511
0.819
0.560
0.777
1.731
x
Acreage in the Kalininsky district, ha
47,150
987
139,890
14,351
4,168
4,089
2,417
4,573
56,000
147,725
Source [1]
Table 3 The covariance matrix of the crop cost (×103 ) Winter
Winter rye
wheat Winter
Spring
Buckwheat
Oat
wheat
Spring
Millet
barley
Grain
Grain
maize
sunflower
102.63
0.94
3.63
0.88
1.00
2.59
2.21
– 18.28
40.05
0.94
0.01
0.02
0.01
0.01
0.03
0.02
– 0.17
0.37
Spring wheat 3.63
0.02
3.17
0.35
0.28
2.23
0.73
– 1.49
3.58
Buckwheat
0.88
0.01
0.35
0.14
0.06
0.29
0.35
Oat
1.00
0.01
0.28
0.06
0.06
0.34
0.17
– 0.15
0.86
Spring
2.59
0.03
2.23
0.29
0.34
3.76
1.31
– 0.48
5.93
wheat Winter rye
0.01
2.67
barley Millet
2.21
0.02
0.73
0.35
0.17
1.31
1.26
Grain maize
– 18.28
– 0.17
– 1.49
0.01
– 0.15
– 0.48
– 0.10
11.12
– 0.10
– 4.98
9.00
Grain
40.05
0.37
3.58
2.67
0.86
5.93
9.00
– 4.98
106.44
sunflower Source Calculated by the authors
The covariance matrix of the cost of agricultural products per 1 ha, obtained with allowances made for the real yield for the period 2001–2018 and sale prices in 2018, is presented in Table 3. The presence of negative and weak covariance indicates the preliminary prospects for risk optimization of agricultural production. The only restrictions in the process of model formation were restrictions on the size of cultivated areas and structure due to scientifically justified requirements for crop rotation. The simplification of the model is related to the purpose of the study, which is related to the overall assessment of risk reduction opportunities through diversification of crop production. The following restrictions are set:
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• • • •
M. O. Sannikova and E. A. Markelova
The total cultivated area does not exceed 80% of the arable land; The cultivated area of grain does not exceed 65% of the arable land; The cultivated area of winter crops varies from 20 to 30% of the arable land; The cultivated area of a sunflower does not exceed 15% of the arable land;
3 Results Particular results of modeling with the use of the indicated approaches are presented in Table 4. Table 4 The results of optimal acreage combination modeling with a variable level of acceptable risk Cultivated area, ha Winter wheat
Winter Spring rye
Buckwheat Oat
wheat
Spring
Millet
barley
Grain maize
Grain sunflower
The
Mean
The
expected
square
variation
cost of
deviation, in the
products, million
cost of
million
products
rubles
rubles The actual average values 30,494
1,691
15,809 5,011
2,512 11,221 3,514
2,178
36,858
3,302.79
597.43
0.24
497.33
0.22
Values obtained from the modeling process 817
50,437 20,287 –
–
16,369 24,920 7,197
27,698
2,252.43
843
43,386 20,680 –
–
16,207 28,994 9,916
27,698
2,348.89
529.65
0.23
879
36,052 19,561 –
–
14,692 34,676 14,167 27,698
2,494.32
591.25
0.24
901
36,030 15,780 –
–
11,358 38,261 17,696 27,698
2,606.22
640.46
0.25
919
36,012 12,612 –
–
8,565
41,265 20,653 27,698
2,699.97
688.58
0.26
935
35,996 9,830
–
–
6,113
43,903 23,249 27,698
2,782.30
734.97
0.26
950
35,981 7,320
–
–
3,900
46,283 25,592 27,698
2,856.57
779.55
0.27
963
35,968 5,015
–
–
1,868
48,469 27,743 27,698
2,924.77
822.39
0.28
976
35,955 2,854
–
–
–
50,497 29,745 27,698
2,988.19
863.65
0.29
994
35,937 –
–
–
–
51,104 31,991 27,698
3,047.37
904.65
0.30
1,025
35,906 –
–
–
–
48,171 34,924 27,698
3,100.39
941.08
0.30
1,053
35,878 –
–
–
–
45,542 37,553 27,698
3,147.91
977.45
0.31
1,079
35,852 –
–
–
–
43,139 39,956 27,698
3,191.36
1,013.43
0.32
1,102
35,829 –
–
–
–
40,910 42,184 27,698
3,231.64
1,048.88
0.32
1,203
35,728 –
–
–
–
31,500 51,595 27,698
3,401.75
1,216.57
0.36
1,284
35,647 –
–
–
–
23,834 59,261 27,698
3,540.30
1,369.10
0.39
1,355
35,576 –
–
–
–
17,199 65,895 27,698
3,660.23
1,509.10
0.41 (continued)
Reducing the Risk of Diversified Agricultural Production …
79
Table 4 (continued) Cultivated area, ha Winter
Winter Spring
wheat
rye
Buckwheat Oat
wheat
Spring
Millet
barley
Grain
Grain
maize
sunflower
The
Mean
The
expected
square
variation
cost of
deviation, in the
products, million
cost of
million
rubles
products
rubles 1,418
35,513 –
–
–
–
11,266 71,829 27,698
3,767.49
1,638.95
0.44
1,476
35,455 –
–
–
–
5,849
77,246 27,698
3,865.40
1,760.47
0.46
1,529
35,402 –
–
–
–
834
82,261 27,698
3,956.05
1,875.01
0.47
Source Calculated by the authors
In order to improve the interpretability of the results, the value of the allowable variance V (1) was replaced with the mean square deviation corresponding to the square root of the variance and measured in the same units as the studied indicator. The variable step of the mean square deviation is explained by the inclusion of the most informative scenarios in the table that provide an understanding of the main regularities. Oat and buckwheat are not included in any of the optimal scenarios. It was established that for the generated model, the lowest possible standard deviation is 4,97.33 million rubles, which is very close to the current value of this indicator—597.43 million rubles. The value of this indicator reflects the maximum risk, after which growth does not lead to changes in the optimal structure, which is 1,875.01 million rubles. The corresponding values of the variation coefficient in the cost of products vary from 0.22 to 0.47, at the current level of 0.24. The dependence of the combination of the sown area and the corresponding values of the expected cost of production on the coefficient of variation is shown in Fig. 1. The least risky option, which involves obtaining products worth 2,252 million rubles, is marked with the maximum set of crops, where winter rye prevails among winter grains and millet among spring crops. The option with the highest risk and the highest expected cost of products (3,956 million rubles) involves the cultivation of winter wheat, winter rye, millet, grain maize, and sunflower. The crop areas of sunflower do not change depending on the set level of risk limit, since, with its high cost and stable yield, it serves as the most preferred crop. In the absence of restrictions on the maximum crop acreage, sunflowers can potentially replace other crops. The percentage of acreage at different risk levels is shown in Table 5. A comparison with the real structure shows that the areas of grain crops are distributed differently. Sunflower occupies a considerable share (in the model, the maximum area of sunflower is limited) in grain crops. As a stable crop with a high cost of its products, sunflower stabilizes and increases the overall production results. Based on the obtained results, using the actual crop yield in 2001–2018 and sales price in 2018, the dynamic series of product costs were modeled. Graphs of scenarios with the highest and lowest risk, as well as a graph of the cost of actually received products, are shown in Fig. 2. The difference in the expected cost of production
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M. O. Sannikova and E. A. Markelova
Fig. 1 Changing the optimal combination of sown areas and the expected cost of products, depending on the acceptable level of risk. Source Calculated by the authors
for the two presented scenarios is quite high. It amounts to 1,704 million rubles, the range of results variation with high risk is higher than with a low (maximum value—10,413 million rubles, the minimum—1,703 million). It should be noted that the minimum value at high risk is greater than the minimum value at low risk, which makes the risk scenario preferable by the minimax criterion, as well as by the value of the mathematical expectation. The current production level is very close to the least risky option, but it is achieved at the expense of a different production structure.
4 Discussion The multicriteria nature of the problem does not allow us to determine the most preferred scenarios. In each case, the choice of the distribution of sown areas will depend on the individual preferences of management of the economic entity and its attitude to risk. The desire to minimize risk than to maximize the cost of products will lead to the choice of a solution with lower volatility indicators (with a predominance of resistant crops). On the contrary, the desire to maximize the cost of production to
Reducing the Risk of Diversified Agricultural Production …
81
Table 5 The structure of acreage depending on the acceptable level of risk The structure of crop areas, % Winter wheat
Winter rye
Spring wheat
Buckwheat
Oat
Spring barley
Millet
Grain maize
2.77
1.64
9.71
2.82
3.10
Grain sunflower
The variation in the cost of products
37.91
0.24
The actual average values 31.92
0.67
9.47
Values obtained from the modeling process 0.55
34.14
13.73
–
–
11.08
16.87
4.87
18.75
0.22
0.60
24.40
13.24
–
–
9.95
23.47
9.59
18.75
0.24
0.62
24.38
8.54
–
–
5.80
27.93
13.98
18.75
0.26
0.64
24.36
4.96
–
–
2.64
31.33
17.32
18.75
0.27
0.66
24.34
1.93
–
–
–
34.18
20.14
18.75
0.29
0.69
24.31
–
–
–
–
32.61
23.64
18.75
0.30
0.73
24.27
–
–
–
–
29.20
27.05
18.75
0.32
0.81
24.19
–
–
–
–
21.32
34.93
18.75
0.36
0.87
24.13
–
–
–
–
16.13
40.12
18.75
0.39
0.92
24.08
–
–
–
–
11.64
44.61
18.75
0.41
0.96
24.04
–
–
7.63
48.62
18.75
0.44
1.00
24.00
–
–
3.96
52.29
18.75
0.46
1.04
23.96
–
–
0.56
55.69
18.75
0.47
Source Calculated by the authors
Fig. 2 Comparative analysis of the expected cost of products with the minimum and maximum level of acceptable risk. Source Calculated by the authors
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M. O. Sannikova and E. A. Markelova
the detriment of the stable production results determines the choice of more valuable crops without regard to the sustainability of their crops. Furthermore, combinations of individual crops depend on their mutual covariance. The variety of weather and climate conditions in different territories affecting the volatility and the level of average crop yield is reflected in the optimization results. Additionally, the model should consider the traditions of farming and the existing specialization of optimized objects, which is reflected in the list of crops included in the model. These factors impose certain restrictions on applying the unchanged model to a wide range of objects. However, the presented method can form the basis for creating modified models that account for individual production conditions. Furthermore, the value of the modeling results can be increased by introducing additional restrictions on the use of resources that account for the ability of business entities to implement optimal diversification plans, and changing the target indicator of the model, which will allow to correlate the cost of products with the spent resources and maximize the efficiency of production. The development of recommendations for improving production efficiency in conditions of an acceptable level of risk, that account for these considerations, is a promising area of research that contains a high practical value.
5 Conclusion In our opinion, modeling the structure of sown areas using quadratic programming allows us to increase the expected cost of production based on diversification without a significant increase in risk. Thus, in Russian agricultural production, diversification has a certain potential as a tool for minimizing risk. At the same time, its use will not be fully achieved in the absence of common risk management supported by compliance with crop cultivation technologies and the quality of used resources.
References 1. Federal State Statistic Service (2019) Database of the Saratov region municipalities indicators. https://www.gks.ru/dbscripts/munst/munst63/DBInet 2. Freund RJ (1956) The introduction of risk into a programming model. Econometrica 24:253–261 3. Hardaker JB, Huirne RBM, Anderson JR, Lien G (2004) Coping with risk in agriculture. CABI Publishing, Wallingford 4. Keikha A, Soltani G, Villano R (2005) Agricultural risk analysis in the Fars province of Iran: A risk-programming approach. The University of New England, Armidale, Australia 5. Manos B, Kitsopanidis G, Meletiadis E (1986) A quadratic programming model for farm planning of a region of central Macedonia. Interfaces 16(4):2–12. https://www.jstor.org/stable/250 60843 6. Markowitz HM (1959) Portfolio selection: efficient diversification of investments. Wiley, New York
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7. R˘adulescu M, R˘adulescu CZ, Zb˘aganu G (2014) A portfolio theory approach to crop planning under environmental constraints. Ann Oper Res 219:243–264 8. Rosa F, Taverna M, Nassivera F, Iseppi L (2019) Farm/crop portfolio simulations under variable risk: a case study from Italy. Agric Food Econ 7. https://doi.org/10.1186/s40100-019-0127-7 9. Sannikova MO (2011) Farms production structure optimization under risk conditions. Bull Saratov State Agrarian Univ Honor N I. Vavilov 3:90–95
Measuring the Impact of Land Degradation on Agricultural Output: The Case of the Volgograd Region (Russia) Oleg A. Makarov , Nikita R. Kryuchkov , and Anton S. Strokov
Abstract It is essential to accompany environmental objectives in the agricultural industry with resources and economic assessments. The complexity of such researches lies in need to compare economic, natural, and climatic indicators different in nature and sources of information. In the second half of the 20th century, various methods were developed to include indicators of soil and land resource quality in econometric analysis, in particular, in the Cobb-Douglas production function. During these studies, the approach was based on the statistical and accounting records of peasant (farm) enterprises and agricultural organizations of the Volgograd Region in 2015 by comparing them with secondary literature on land degradation in the region. The modified linear-logarithmic production function was constructed by analogy with the methodology of S. Walpole, J. Sinden, and T. Yapp. The calculations showed that the salinity of agricultural lands in the region where the agricultural enterprise is situated is insignificant but has a negative impact on the income (revenue) of farms and agricultural organizations. However, due to adaptive technologies, high soil bonitet score, and more efficient use of resources, peasant farms look more economically stable than agricultural enterprises in the Volgograd Region. Keywords Economics of land degradation · Agriculture industry · Ecology · Salinity of lands · Peasant (farm) enterprises · Agricultural organizations
1 Introduction The efficiency of using land resources has long been of interest to economists. David Ricardo (1817) was the first to point out that agricultural production could shift to low-productivity lands in the event of a shortage of fertile land (Ricardo O. A. Makarov (B) · N. R. Kryuchkov Lomonosov Moscow State University, Moscow, Russia A. S. Strokov Russian Academy of National Economy and Public Administration (RANEPA), Moscow, Russia e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_11
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1817). Alfred Marshal (1890, pp. 135–136) tried to challenge Ricardo’s idea that the first settlers in a new territory really “know” what land is fertile and what is not. He showed that the land is taken (or bought) spontaneously. Therefore, maximum profits can be derived from the land through capital investments and human resources only due to knowledge, skills, and scientific and technological progress [4]. Thus, before the beginning of the 20th century, the importance of land was reduced to its quantity or length. The factors of fertility, soil degradation, or soil restoration remained in the shadow of labor and capital. In the second half of the 20th century, economic science started to actively implement econometric modeling methods with the use of actual (statistical) data on an economic entity located in a particular region or country. Thus, the issue of assessing land resources became urgent again. The concept developed by E. O. Heady [2] and D. E. MacCallum [5] implies the introduction of concepts of “degraded and undegraded as a result of human economic activity” to decide on their further use or conservation (withdrawal). E. O. Heady believed that land conservation would restore depleted (degraded) soil to its former properties. MacCallum researched the economic consequences of cultivating eroded soil. These studies were continued by E. O. Heady and J. L. Dillon. They proposed to evaluate the production function of the Cobb-Douglas type using qualitative indicators of land resources [3]. In later applications, using the example of Australia, it was shown that soil erosion and the presence of long gullies on the cropland affected wheat yields [6], (Walpole et al. 1996). In recently published works [7], land degradation is recognized as a global ecological and agricultural problem. The economic assessment of degradation processes is considered a factor affecting agricultural production. Russian scholars pay special attention to assessing the type of degradation (e.g., soil erosion, agricultural production, etc.). Thus, V. G. Bezuglov, G. D. Gogmchadze, and M. E. Sinigovec [1] show that with an increase in the proportion of eroded arable land in farmland, soil washout increases. The research of these specialists shows that the crop yields began to decline (up to 30%) only when the area of eroded soil exceeds 70% of the total area of the municipality [10]. N. G. Ovchinnikova [9] notes that in a risky farming zone, soil erosion has a profound effect on crop yields (10%–20% decrease). The research aims to provide an economic assessment of the consequences of secondary soil salinization, which occurs from the illiterate use of irrigation technologies on arable land. The calculations were made for the territory of the Volgograd Region, where secondary soil salinization is extremely spread on agricultural lands [8, 11, 12]. However, there is no econometric analysis of the impact of salinization on agricultural organizations in the region. The work uses the methodology of S. Walpole, J. Sinden, and T. Yapp (1996) to construct a modified Cobb-Douglas production function for assessing the influence of production factors on output.
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2 Materials and Methods The classical generic Cobb-Douglas production function is as follows: Q = A × Lα × Kβ
(1a)
where: A—technological factor; L—labor costs; K—capital costs; α ≥ 0—the elasticity coefficient of labor; β ≥ 0—the elasticity coefficient of capital. The methodology developed by S. Walpole, J. Sinden, and T. Yapp (1996) proposes considering the position of D. E. Maccallum [5] on the importance of land quality and the economic feasibility of restoring degraded soils. This methodology expresses the Cobb-Douglas function for agricultural production by Eq. (1b): q = f(w, l, k)
(1b)
where: q—quantitatively expressed the yield of agricultural products; w—labor costs; l—land resource cost; k—the investment of capital. When assessing soil and land quality, Eq. (1c) changes as follows: q = f(w, l, k, d)
(1c)
where: q, w, l, k—the same as in Eq. (1b), d—soil and land quality. S. Walpole, J. Sinden, and T. Yapp (1996) proposed various options for implementing the quality factor of soil and land resources, including using indicators of their degradation (erosion) for farming in Australia. They assess the performance of the production in a linear logarithmic way. The land degradation factor is not logarithmized but is implemented in the model arithmetically: ln(y) = a1 +
an ln(xi) + an xj + e
(2)
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where: y—the output (logarithmic to natural logarithm); a1 and an—estimated constants and factors of production; xi—“traditional” factors of production (labor, land, and capital); xj—a factor of soil and land degradation; e—the remnants of the equation. The logarithm of “traditional” factors is necessary to “shift” the Cobb-Douglas function to the size of the degradation factor. During the research in the Volgograd Region, we used saline agricultural land as a percentage of total agricultural land degradation. Therefore, the method of S. Walpole, J. Sinden, and T. Yapp (1996) allowed us to assess how much the production opportunity curve is shifted in different types of agricultural holdings located in the same area and affected by land degradation. This is the very case of the Volgograd Region, where agricultural organizations and peasant (farmer) enterprises [P(F)E] are actively developing. To carry out the correlation and regression analysis of the production function (Formula (2), we used the database of the Ministry of Agriculture of the Russian Federation for agricultural and peasant farms. In the initial sample of 2015, there were 547 agricultural enterprises and 2,060 P(F)E. To correctly construct the production function and ensure that the calculated parameters are not “shifted,” we “cleaned” the database from farms with indicators significantly less than the average values or exceeding it. There were 336 agricultural organizations and 803 P(F)E. When studying P(F)E, we focused on (1) the income indicators of agricultural products (the dependent y variable in Formula (2)), (2) the number of employed workers; (3) the size of land parcels; and (4) the purchase of inputs and material expenditure for the current year. The purchase of inputs and material expenditures for the current year were interpreted as capital. When studying agricultural organizations, we focused on (1) the proceeds from the sale of livestock and crop products (dependent on the y variable); (2) the number of employees (labor); (3) the size of the agricultural land used (land); (4) the production costs of crop and livestock production (capital). Since the databases mentioned above lacked information on soil and land quality, we also used secondary literature of regional character [12]. The indicator of salinized land was used to prepare regression equations. We compared the validation of Formula (2) for the sample of P(F)E and agricultural organizations of the Volgograd Region.
3 Results Table 1 shows a sample of 24 districts of the Volgograd Region in terms of (1) the productivity of agricultural land, (2) the revenue per unit of used land in 2015 in the agricultural organizations [AO] and P(F)E of the Volgograd Region, (3) some quality features of soil and land resources of administrative districts (e.g., soil bonitet, the
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share of saline agricultural land in the total area of agricultural areas of the district, etc.) [12]. In most northern, north-western, and western districts, agricultural land productivity lies in the range of 9–19 centners of feed units per ha. In these regions, the proceeds from one ha of land vary from 11 to 20 thousand rubles per one ha. In these districts, the point of bonitet of agricultural soil exceeds 88 points. The proportion of saline land (the proportion of saline soil to the total area of agricultural land in the administrative area) is less than 4%. These districts have the most favorable environmental conditions and the most productive soils, which allow the sufficient use of land resources. From the northern and north-western to the south districts (Kamyshynsky, Kalachevsky, and Stavropoltavsky districts) and south-east and east (Kotelnikovsky, Oktyabrsky, Olkhovsky, Pallasovsky) districts, the productivity of land resources decreases. In these areas, soil bonitet is in the range of 46–63 points. In most cases, the proportion of salinized agricultural land in the districts’ area is greater than 10% and even 20% (Bykovsky and Kotelnikovsky districts). As a result, land productivity is 2–3 times less than in the northern and northwestern districts of the region. The income from 1 ha is 2–5 thousand rubles. Thus, the negative impact of land degradation (secondary salinization) on the productivity of agricultural holdings in the Volgograd Region and, as a result, on the incomes of economic entities is evident. In 10 cases out of 24 P(F)E, the rate of return from the unit of agricultural land is about 5%–10% higher than that of the agricultural organizations of the same district (Novokolayevsky, Novoanninsky, Kikwiedzensky, Uryupinsky, etc.). The results of the Cobb-Douglas correlation regression analysis according to the productive functions (Formula (2)) are presented in Fig. 1. We will analyze the results of calculations for a sample of 803 P(F)E from Fig. 1. Column “Coef.” shows the calculated parameters (elasticity) of the equation. The growth of income is more influenced by cost growth (elasticity 0.88) and employment (elasticity 0.23). The size of agricultural land has a negative impact, which may indicate that the expansion of the farm area is, in most cases, not recouped during economic activity. The salinity of agricultural land in the district is negative but relatively insignificant— −0.01 (statistically significant according to column P > [t]). According to D. E. McCallum [5], this value will shift the function graph. This shows a shallow level of impact on farm income and a high level of adaptation. Nevertheless, the hypothesis of the negative impact of soil salinization on output (in this case, on the total income from P(F)E production is confirmed. Figure 2 shows the results of calculating the production Function (2) with estimated parameters (Column “Coef”) for a sample of 336 farms from the group of agricultural organizations of the Volgograd Region. All variables are statistically significant except var7 (the area of agricultural land used in the AO). Consequently, the use of lands in agricultural organizations is inefficient and uneven.
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Table 1 Comparing the productivity of used agricultural lands, the proceeds from sales in agricultural organizations and P(F)E in 2015, and the soil and quality indicators of soils and land resources of the Volgograd Region (24 of 33 administrative districts of the Region) District
P(F)E, the productivity of land, 100 kg of feed units per ha
AO, the productivity of land, 100 kg of feed units per ha
P(F)E, the income per hectare of land use, rubles per hectare
AO, the income per hectare of land use, rubles per hectare
Nikolayevsky
18.1
18.8
20,239
19,151
97.3
1.0
Novoanninsky
15.4
17.7
18,398
17,000
92.0
2.4
Kikvidzensky
16.4
13.9
16,462
15,522
92.5
1.0
Uryupinsky
16.2
13.7
16,184
15,200
88.2
1.9
8.6
13.6
12,352
16,176
91.9
2.3
Nekhayevsky
10.7
13.3
11,619
13,152
90.8
1.0
Mikhaylovsky
10.5
11.5
11,520
15,658
88.0
4.4
5.7
9.5
4,590
8,825
72.5
11.3
10.8
9.4
8,932
8,024
83.6
1.0
Chernyshkovsky
7.5
7.8
5,386
6,332
68.1
1.9
Danilovsky
4.8
5.6
6,112
4,854
76.0
8.3
Frolovsky
4.9
5.5
4,284
6,575
79.4
2.0 11.3
Yelansky
Kletsky Kumylzhensky
Soil bonitet, points
The share of saline agricultural land in the district, %
Dubovsky
1.6
5.3
1,314
4,188
51.2
Surovikinsky
3.4
5.1
2,841
5,566
61.3
5.0
Kotelnikovsky
4.0
4.5
3,745
3,636
53.6
29.2
Oktyabrsky
4.4
4.1
3,681
4,281
51.0
14.0
Kalachyovsky
4.6
3.5
4,888
5,404
50.6
17.2
Olkhovsky
2.6
3.5
3,007
2,869
58.7
9.9 23.5
Bykovsky
2.2
3.4
4,394
4,390
56.0
Zhirnovsky
4.5
3.2
7,253
4,820
76.1
9.5
Staropoltavsky
2.5
3.1
3,028
3,172
63.8
15.5
Kotovsky
1.7
3.0
2,033
4,259
59.6
19.4
Pallasovsky
0.8
2.5
2,136
3,076
46.9
2.5 (continued)
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Table 1 (continued) District
Kamyshinsky
P(F)E, the productivity of land, 100 kg of feed units per ha
1.8
AO, the productivity of land, 100 kg of feed units per ha
1.9
P(F)E, the income per hectare of land use, rubles per hectare
AO, the income per hectare of land use, rubles per hectare
Soil bonitet, points
2,371
3,897
52.6
The share of saline agricultural land in the district, %
9.0
Note: The table does not provide the data for several districts (Rudnyansky, Srednakhtubinsky, Serafimovichsiy, Gorodeshchensky, Leninsky, Alekseevsky, Svetlyarsky, Ilovilskiy, and Nikolayevsky). These regions have a high salinity of agricultural land and a significant economic effect on its use (income per hectare, as a rule, more than 20 thousand rubles). Moreover, these districts are highly specialized in producing vegetable products, which is more expensive than grains and sunflowers, and most of the other districts specialized in agriculture Source Calculated by the authors based on [12]
Note: var1 – the income of P(F)E from selling agricultural products, rub. (dependent variable); var2 – expenditures of P(F)E, rub; var6 – labor resources of the peasant (farm) enterprises, including employees and members of P(F)E, man.; var7 – land resources of peasant(farm)holdings, ha; var12 is the percentage of saline agricultural lands in the area of agricultural land in which the farm is situated. Fig. 1 The calculation of the production Function (2) for the sample of the P(F)E of the Volgograd Region for 2015. Source Calculated by the authors
As in the case of P(F)E, costs (elasticity 0.76) and labor (employment in agricultural organizations) with elasticity 0.17 have a positive impact on the growth of income of the AO.
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Note: var1 – the income of AO from livestock and crop products, rub (dependent variable); var6 – the total number of people employed in the AO; var7 – used agricultural land, ha; var2 – costs of the main production of crop and livestock products, minus wages and social contributions, rub; var12 – the proportion of saline agricultural land in the area of agricultural land in which the farm is situated, %. Fig. 2 Results of the calculation of the production function (2) for the Volgograd region agricultural organizations for 2015. Source Calculated by the authors
The soil salinity in agricultural organizations is less important than in P(F)E because it has a parameter value of less than 0.01. However, it is still statistically significant at 5% of the level (column P > [t]). Thus, land degradation does affect the profitability of agricultural organizations.
4 Discussion The theoretical concept of land degradation had emerged in the 1960s when it was proposed to use quality indicators of the state of land resources or cultivated soils in production functions. Later, there were offered various modifications of the mathematical apparatus of econometric analysis depending on (1) the analyzed region, (2) database, and (3) the comparability of the analysis units in terms of economic and climatic indicators. When calculating labor, land, and capital resources traditionally (using a linear-logarithmic function), we used a modified function of Cobb-Douglas. Nevertheless, an indicator of soil degradation (quality of land resources) is entered in the usual arithmetic (not logarithmic) form since it shows the shift of the dependent variable curve according to the methodology of D. E. McCallum [5]. This allows us to carefully assess the negative (in theory) impact of land degradation without a strong emphasis on the revenue (productivity) of farms in the sample. We investigated the applied aspect of the influence of degradation land (secondary salinization of soils) on the efficiency of agricultural production in the Volgograd
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Region. This region is located in favorable natural and climatic conditions in South Russia near the Caspian Sea. However, the region has an agricultural economy and greatly suffers from past management mistakes (excessive and improper use of water resources in agricultural production) and the irresponsibility of current management (low level of fertilizer use in agriculture, insufficient reclamation, etc.). This led to the fact that the farms in the region have been experiencing relatively low yields of cereals and sunflowers. The total productivity of agricultural land does not grow due to erosion and soil salinity. The noted facts were previously described in the secondary literature. Nevertheless, no one assessed a comprehensive economic effect from land degradation (in this case, secondary salinization of soils).
5 Conclusion The research used the applied aspect of the impact of land degradation (secondary salinization of soils) on the efficiency of agricultural production in the Volgograd Region. Our calculations showed that soil salinization shifts the production function by 0.01% in P(F)E and slightly less in AO (less than 1%). That is, soil degradation negatively affects profitability. Its contribution to production is insignificant and compensated by adaptive technologies and the corresponding investments. The calculations of elasticities (parameters) of the equation for production factors showed that farms use human (hired labor and labor of farm members) and capital (costs) resources more effectively. Consequently, farms can develop more sustainably in this region of the country. However, the Volgograd Region lacks full-scale work to restore soil fertility in areas with low soil bonitet scores and high salinity levels. These areas are mainly located in southern, south-eastern, and some central areas. Land productivity in these areas is more than two-fold lower than in the northern and north-western parts of the region (consequently, they receive less income). In territories with low-yielding and saline soils, it is necessary to imply soil protection measures and promote the development and dissemination of resource-saving technologies, multifield crop rotation with grass crops, and drip irrigation. Acknowledgements The work is supported by RFBR grant no. 19-29-05021 MK.
References 1. Bezuglov VG, Gogmachadze GD, Sinigovets ME (2008) The status of soil erosion in Russia. Agroecoinfo 1:3–20 2. Heady EO (1952) Economics of agricultural production and resource management. PrenticeHall, Englewood Cliffs
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3. Heady EO, Dillon JL (1961) Functions of agricultural production. Iowa State University Press, Ames 4. Marshall A (2013) Principles of economics, 8th edn. Palgrave Macmillan, New York. https:// www.library.fa.ru/files/Marshall-Principles.pdf 5. McCallum DE (1967) Soil erosion control and resource allocation. In: Proceedings of the 10th meeting annual conference of the Australian society for agricultural economics, Armidale, Australia 6. Molnar I (1965) Production in relation to precipitation, superphosphate, and erosion. Aust J Agric Econ 9(2):169–175 7. Nkonya E, Mirzabaev A, von Braun J (eds) (2016) Economics of land degradation and improvement – a global assessment for sustainable development. Springer, Dordrecht. https://doi.org/ 10.1007/978-3-319-19168-3 8. Novikova AF, Konyushkova MV (2008) Soil and agroecological zoning of the Volgograd region and the main directions of integrated reclamation. Arid Ecosyst 14(35–36):34–46 9. Ovchinnikova NG (2011) Development of socio-ecological and economic mechanisms improving methods of using land resources. Vuzovskaya kniga, Rostov-on-Don 10. Strokov AS, Petreeva EA (2016) Economic assessment of the impact of degradation land on crop production. Agro-Ind Complex: Econ Manag 7:49–56 11. Tkachenko NA, Koshelev AV (2019) Exposure to degradation processes agricultural lands of the Volgograd Zavolzhye. Sci Agron J 2(105):7–9 12. Vorobyov AV (2014) Land reform in the Volgograd region (changes in agricultural land use in the region in 1990–2010). Volgograd State Agricultural University, Volgograd
Russian Regional Agri-Food Systems Facing Global Climate Challenges: Scenarios for Future Development Stanislav O. Siptits , Irina A. Romanenko , and Natalia E. Evdokimova
Abstract The creation of long-term strategies for the development of regional agrifood systems faces the need to take into account climate dynamics and to adapt its actions according to these changes. There exist several ways of influencing the climatic factor: a direct impact on the socio-biosystem, causing adaptive reactions of agri-food systems, and indirect impact, which is performed through the external economic environment. The purpose of this study is to consider different scenarios for determining the impact of new climatic parameters on land use in the framework of the identified areas of global socio-economic development. Scenarios for the development of regional agri-food systems in the external environment are proposed. They can serve as the basis for the development of mathematical models for assessing adaptive responses to climate dynamics. Keywords Agri-food system · Climate · Scenario · Forecasting · Mathematical model
1 Introduction Over the past ten years, the scenarios used by many research groups and scholars to develop long-term climate policies are contained in a special report on emission scenarios [4]. Scenarios are considered “basic” (or “reference”) if they are not intended to represent any current or future climate policy. However, they are used as a reference for future forecasts of the impact of climate change (and other) strategies. The framework includes four scenarios (A1, A2, B1, and B2) with 40 specific subscenarios. Each of them makes different assumptions about the main driving forces S. O. Siptits (B) · I. A. Romanenko · N. E. Evdokimova All-Russian Institute of Agrarian Problems and Informatics named after A.A. Nikonova – Branch of the Federal Research Center of Agrarian Economy and Social Development of Rural Areas – All Russian Research Institute of Agricultural Economics, Moscow, Russia I. A. Romanenko e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_12
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(economic growth, population growth, technological development, energy, and land use) until 2100. Within the framework of “reference” scenarios, Russian researchers [9] assess the effects of climate change on arable land with and without adaptation measures. Special attention is paid to maintaining organic carbon stocks in the soil. Future scenarios of regional agricultural production systems were built for 2000–2070, linking the effects of global climate change, projected changes in productivity parameters for major crops, parameters of land use, and soil database. However, in 2006, the Intergovernmental Panel on Climate Change [IPCC] decided to change the approach in connection with several facts. 1.
2.
There is a need to obtain more detailed information for the use of climate models of the current generation, namely, climate models of the Coupled Model Intercomparison Project 5 [CMIP] project. Whereas in the previous CMIP3 project, ensemble estimates were determined by 16 global Atmosphere-ocean general circulation models [AOGCM] [7], the CMIP5 project uses data from more than 50 models presented by more than 20 research teams from different research centers for generalization. Compared to the models of the CMIP3 project, the CMIP5 models are, on average, characterized by higher spatial resolution and several improvements in the description of climatic processes. The increased interest in scenarios, specifically those studying the impact of various climate strategies, as well as the feasibility of simultaneously exploring the role of mitigation and adaptation [5]. It was also decided that such scenarios would not be developed under the IPCC, and their development would be left to the discretion of the research community. The research in this area is divided into three stages:
– The development of a set of climate scenarios with emission trajectories, Representative Concentration Pathways [RCP] of carbon dioxide associated with the stabilization of the total anthropogenic impact at different levels by 2100; – The development of new Shared Socio-Economic Pathways [SSP] [6], including options for the dynamics of macroeconomic indicators. In total, SSP include five different pathways that show different trends in key dimensions (demography, economics, lifestyle, politics, institutions, technology, environment, and natural resources), – The stage of integration and distribution [5]. Various scenarios of SSP are described by B.C. O’Neil [6], K.C. Samir and W. Lutz [10]. These scenarios are built based on two axes: the problem of climate change mitigation and the problem of adaptation. It results in five pathways that show different trends in key dimensions (such as demography, economics, lifestyle, politics, institutions, technology, environment, and natural resources). For each scenario, these pathways are as follows: • SSP1 (or “sustainability”);
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• SSP2 (or “midway”): current trends continue with moderate progress in income convergence. • SSP3 (or “fragmentation): economic growth is expected to be much slower due to a combination of such reasons as the lack of international cooperation, slow technological progress, low level of education, and high population growth. • SSP4 (or “inequality”): high-income countries use technological advances to stimulate economic growth, which leads to high mitigation. The development in lowincome countries is hampered by deficient education and international barriers to trade. They limit economic growth to reasonably low levels, implying low levels of per capita income and high adaptation to challenges. • SSP5 (or “traditional management”): countries entirely focus on economic development, regardless of environmental impacts. High-income countries make an emphasis on advanced technology, while many developing countries are increasing the demand for fossil energy sources. One of the essential aspects of the considered paths of global development is that they integrate each scenario with two main objectives of climate policy: mitigation and adaptation. The pathways were used to obtain demographic [10] and economic forecasts in the framework of sound socio-economic and climate scenarios [1]. The Scenario of Higher Emissions (RCP 8.5) imitates the current path of increasing greenhouse gas emissions and population growth until the end of the century with a nominal emission reduction policy. This “current path” suggests that warming will continue at its current pace. RCP 8.5 was based on the revised A1FI scenario. The pathway emphasizes high population growth and lower-income in developing countries [11]. The scenario of emission reduction (RCP 4.5) simulates a reduction in greenhouse gas emissions through mitigation efforts Table 1. I.A. Romanenko [9], investigates the A1FI and B1 scenarios for the European territory of Russia and Ukraine. It was shown that, in the absence of adaptation Table 1 The comparison of climate scenarios for CMIP3 and CMIP5 projects CMIP5 project scenarios CMIP3 project scenarios, which The main differences served as the basis for the development of the corresponding CMIP5 scenarios RCP 8.5
A1FI
The average temperature of the RCP 8.5 scenario grows slower than in the A1FI scenario in the period 2035–2080 and faster in other periods of the 21st century
RCP 4.5
B1
The average temperature of the RCP 4.5 scenario grows faster than in the B1 scenario in the first half and slower in the second half of the 21st century
Source Developed by the authors
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measures, there would occur a significant decrease in carbon stocks in the country’s arable land by 2070. Changing the initial climatic conditions for carrying out predictive calculations requires further study of this problem, both for the European territory and for other regions of Russia.
2 Materials and Methods Possible combinations of climatic and socio-economic scenarios for the development of regional AFS in Russia are presented in Table 2. Table 2 Possible combinations of climatic and socio-economic scenarios for the development of regional AFS in Russia until 2080 Scenario
Target setting of SSP1 the climate sustainable scenario by the end development of the 21st century
RCP 8.5—hard scenario (arid)
Climatic trends do not change, which leads to a warming of 50 °C, on average, and a carbon concentration will equal to 8.5 W/m2 by the end of the century
Source [3, 11]
SSP4 inequality, property stratification, growing differences between rich and poor regions Scenario “traditional management”
RCP 4.5—medium The temperature scenario increase does not exceed 30 °C, and a carbon concentration will equal to 4.5 W/m2 by the end of the century RCP 1.9—scenario The temperature of sustainable increase does not development exceed 1.50 °C, and a carbon concentration will equal to 1.9 W/m2 by the end of the century
SSP2 “Midway”
Scenario “midway”
Scenario “sustainable development”
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In our study, we added a scenario that provides the conditions for the implementation of the Paris climate agreement ratified by the Russian government. This is the Scenario of RCP 1.9, which implies sustainable development with a slight increase in global temperature. Its goal can be achieved as a result of stringent measures of political regulation of air emissions. Let us consider the methodology for the formation of scenario conditions using the basic scenario “Traditional management” Table 3. The main parameters of the scenario are as follows: • The macroeconomic conditions of the scenario corresponding to the inertial forecast of the Ministry of Economic Development for the population, prices, and incomes of the population; • The volume of exports of agricultural raw materials and food remained at the level of the last five years and is made up of increasing exports of effective regional AFS and decreasing exports of inefficient ones. This scenario’s socio-economic conditions are formed in the framework of the following main pathways: the preservation of existing inequalities and the growing differences between the rich and poor regions of Russia. • The climatic factor that determines the yield of major crops, and, accordingly, the productivity of farm animals, leading to a decrease or increase in production (both due to changes in yield and due to changes in sown areas), corresponds to the climatic scenario RCP 8.5. Yields and sown areas depend on the type of production behavior of agricultural producers in regional farms. It is assumed that the financial condition of regional AFS will remain at the same level in this scenario. To determine the property stratification of regional APS, we assessed the financial stability of agricultural organizations. For the assessment, it is proposed to use the known coefficients of financial analysis (liquidity, etc.) concerning the financial balances of agricultural enterprises in the whole region [2]. As a result of the analysis of financial stability, three main groups of regional AFS were identified (a group of highly stable AFS, a group of stable AFS, and a group of unstable AFS). Each group has a pathway to production and consumer behavior. The types of production behavior of regional AFS are proposed to be characterized as follows (Table 4): These types of production behavior were obtained by a combination of directions of change in growth rates for the dynamic series of indicators of production size, such as areas, stocks, and the level of their intensification, which is reflected in the growth of yield and productivity [8]. Types of consumer behavior were investigated by comparing the parameters of the demand functions for different periods. We studied the change in consumption of animal products (milk and meat), and found out the reasons for this change. Two 10year periods (1995–2005 and 2006–2015) were considered. We focused on changes in price and income in demand for meat and meat products, as well as for milk and dairy products.
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Table 3 The parameters of the scenario “traditional management.” SSP4 Russia Inequality, property stratification, growing differences between rich and poor regions
Population
Regions with high-income (1 group of financial stability)
Regions with middle-income (2 group of financial stability)
Regions with low-income (3 group of financial stability)
Scenarios of the Ministry of Economic Development
Scenarios of the Ministry of Economic Development
Scenarios of the Ministry of Economic Development
Middle food exports
Low food exports
The level of trade High food exports globalization Consumption of animal products
Maintaining current consumption
State regulation of land use
Tight regulation (administrative requirements for complying with crop rotation and fertilizer restrictions, livestock loading per 1 ha of arable land)
Moderate regulation (financial incentives to comply with crop rotation and fertilizer restrictions, livestock load per 1 ha of arable land)
Crop productivity High + strong Medium + moderate desire for desire for improvement in technology (3 improvement in types of production behavior) technology (1 type of production behavior)
Weak regulation (recommendations for crop rotation and fertilizer restrictions, livestock load per 1 ha of arable land)
Low + weak desire for improvement in technology (5 and 6 types of production behavior)
Livestock productivity
High + strong Medium + moderate desire for desire for improvement in technology (3 type technological of production behavior) improvements (1 type of production behavior)
Low + weak desire for improvement in technology (5 and 6 type of production behavior)
The efficiency of climate change prevention
Moderate (balance of humus due to organic matter + mineral fertilizers, restrictions on fertilizers)
Moderate (balance of humus due to organic matter + mineral fertilizers, restrictions on fertilizers)
Source Developed by the authors
Moderate (balance of humus due to organic matter + mineral fertilizers, restrictions on fertilizers)
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Table 4 The types of production behavior of regional AFS Type
Content characteristic
I
Enhanced production intensification
II
Extensive production growth
III
Intensification of production with a decrease in its scale
IV
De-intensification of production that is not compensated by the growth of its scale
V
A decrease in production scale that is not compensated by an increase in intensification
VI
Economic degradation of production
Source Developed by the authors
3 Results and Discussion The analysis of the production behavior of the Russian AFS for 1995–2015 allowed us to determine their main types. The figures show the common types of production behavior in crop production Fig. 1 and livestock Fig. 2. As can be seen, not all cases of production behavior of
Fig. 1 The predominant types of production behavior in crop production. Source Developed by the authors
Fig. 2 The predominant types of production behavior in livestock. Source Developed by the authors
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AFS occur with the same frequency. In livestock breeding, practically no regions are demonstrating the production behavior of the second and fourth types. Thus, in the production of milk, the second type of behavior is shown by zero regions, and the fourth type is shown by one region. In cattle and pork meat production, the second and fourth types of production behavior are demonstrated by 0 regions. Only six regions have the second type of production behavior in sheep breeding. In poultry farming, there are also practically no regions of the second (1) and fourth (2) types of production behavior. Based on the obtained results, it is advisable to consider only the first, third, and fifth types of production behavior of regional AFS in animal husbandry, connecting the regions of the second type to the first, and the fourth to the third one. It is proposed to assign regions of the sixth group (production degradation) (there are practically none in cattle meat production, pig farming, and poultry farming) to the fifth type of production behavior. In crop production, the same picture is observed. Most regional AFS demonstrate three types of production behavior. The analysis of consumer behavior in regional AFS allowed us to identify regions where the type of consumer behavior did not change over the two considered tenyear periods. In most regions, the elasticity of demand for milk at its price did not change (the range of changes varied from −0.1 to +0.1). There are 49 regions in this group. Such a result indicates the stability of the consumption of milk and dairy products to price fluctuations in the market. Consumer behavior in these regions can be characterized as stable, which allows us to assume that the price elasticities in the milk demand remain at the same level. In 34 regions, the degree of influence of household income on milk consumption did not change; in 26 regions, the dependence of milk consumption on income increased. Particularly significant increase in the dependence of milk and dairy products on income (income elasticity by more than 0.1) occurred in the Rostov Region (0.11), the Stavropol Krai and the Tambov Region (0.13), the Belgorod and Tomsk Regions, the Republic of Tatarstan (0.14), the Samara Region (0.15), the Republic of Adygea (0.21), the Republic of Bashkortostan (0.22), the Yaroslavl Region (0.23), the Kamchatka Krai (0.25), the Republic of Dagestan (0.27), the Chukotka Autonomous Okrug (0.41), and the Magadan Region (0.54). As for consumer behavior in the consumption of meat and meat products, the distribution of regional AFS by the degree of change in income elasticity in demand is as follows: in most regions, as in the case of milk and dairy products, the income elasticity of demand for meat has not changed (the range of changes is from −0.1 to +0.1). There are 39 regions. In 18 regions, the elasticity of demand for meat per capita income decreased. In these regions, the demand for meat has become less dependent on population income. In 20 regions, the influence of household income on meat consumption has significantly increased (income elasticity by more than 0.1). These are the Moscow and Saratov Regions and the Republic of Adygea (0.11), the Leningrad Region (0.13), the Republic of Tatarstan, the Astrakhan and Kurgan Regions (0.15), the Krasnodar Krai and the Udmurt Republic (0.16), the Voronezh and Rostov Regions (0.17), the Penza Region, the Republic of Mari El, and the Stavropol Krai (0.18), the Republic of Ingushetia (0.2), the Volgograd Region and
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the Republic of Buryatia (0.21), the Republic of Dagestan (0.24), the Kar AchayCherkess Republic (0.26), and the Republic of Kalmykia (0.4). In 40 regions, meat price elasticity was relatively stable. In 19 regions, the effect of price on the product in question decreased, and it increased in the other 18 regions. The most significant increase in the impact on the consumption of meat and meat products of their prices (elasticity increase by more than 0.1) occurred in the following regions: the Novosibirsk Region (0.11), the Murmansk Region, and the Komi Republic (0.15), the Smolensk Region (0.16), the Republic of Tuva (0.17), the Primorsk Krai (0.18), the Tver Region (0.2), the Republic of Bashkortostan, the Altai and Zabaykalsk Krais (0.22), the Jewish Autonomous Region (0.24), the Kamchatka Region (0.25), the Arkhangelsk and Irkutsk Regions (0.26), the Republic of Karelia (0.28), the Amur Region (0.43), the Kemerovo Region (0.44), and the Magadan Region (0.68). It should be noted that, as in the case of milk, most regions retained the type of consumer behavior, despite the growth of population income. The income elasticity of demand remained unchanged there.
4 Conclusion When developing scenarios for the long-term socio-economic development of the Russian AFS, taking into account possible climatic changes, it is proposed to consider only three types of their production behavior, both in crop production and in animal husbandry (enhanced production intensification, intensification of production with a decrease in its scale, and a decrease in the production scale that is not compensated by an increase in intensification). The behavior of consumers of AFS is proposed to be considered unchanged in most regions. Therefore, in demand for animal origin products, the main parameters can be left unchanged when forecasting the demand for agricultural products, which will determine the possible volumes of consumption, depending on the forecast values of the population’s income. In regions where the parameters of the demand functions have changed, it is necessary to conduct an expert assessment of the possible directions of changing types of consumer behavior, based on the estimates obtained in this study.
References 1. Dellink R et al (2017) Long-term economic growth projections in the shared socioeconomic pathways. Glob Environ Chang 42:200–214 2. Gataulina E (2019) The assessment of the financial condition of the sector of agricultural organizations as an element of the methodology for forecasting the development of agri-food systems. Econ Labor Manag Agric 3(48):10–16
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3. Grubler A et al (2018) A low energy demand scenario for meeting the 1.5 °C target and sustainable development goals without negative emission technologies. Nat Energy 3(6):517– 525. https://doi.org/10.1038/s41560-018-0172-6 4. IPCC (2000) Special report on emissions scenarios. Cambridge University Press, Cambridge 5. Moss RH et al (2010) The next generation of scenarios for climate change research and assessment. Nature 463:747–756 6. O’Neill BC et al (2017) The roads ahead: narratives for shared socioeconomic pathways describing world futures in the 21st century. Glob Environ Chang 42:169–180. https://doi. org/10.1016/j.gloenvcha.2015.01.004 7. Romanenko IA (2005) The long-term assessment of the reproductive potential of a regional ecosystem. Int Agric J 1:25–27 8. Romanenko IA, Siptits SO (2015) The problem of the effectiveness and sustainability of agricultural development in the regions of the Russian Federation. Agric Econ Russ 2:6–13 9. Romanenko IA et al (2007) Constructing regional scenarios for sustainable agriculture in European Russia and Ukraine from 2000 to 2070. Reg Environ Chang 7(2):63–77 10. Samir KC, Lutz W (2017) The human core of the shared socioeconomic pathways: population scenarios by age, sex, and level of education for all countries to 2100. Glob Environ Chang 42:181–192 11. Van Vuuren D et al (2019) Pathways toward sustainable development. Glob Environ Outlook 6:511–544. https://doi.org/10.1017/9781108627146
Sustainable Development of the Agricultural Sector Through Innovations and Promising Technologies Yury A. Tsypkin , Serhij L. Pakulin , and Inessa S. Feklistova
Abstract Sustainable development of the Russian agro-industrial complex [AIC] based on the introduction of innovations and promising technologies is an urgent scientific task, as it helps to increase the level and quality of life of the population, the overall greening of the economy of the country. The authors of the paper used various methodological tools, including calculation and analysis, economic and statistical, etc. A systematic approach was used to substantiate recommendations on sustainable development of the AIC based on the introduction of innovations and promising technologies, taking into account international experience in the development of the agricultural sector. The purpose of the study was to identify priority areas for the sustainable development of the AIC based on the introduction of innovations and promising technologies, taking into account international experience in the development of the agricultural sector. In order to formulate priority directions for the development of bioeconomics in the Russian AIC, it is necessary to use the best practices of developed countries that have been using innovative biotechnologies in agricultural production for a long time. Therefore, further analysis and evaluation of international strategic programs that determine the long-term priorities of the state regarding the development of agricultural bioeconomics is essential and relevant. Modern biotechnologies allow Russian AIC to produce environmentally friendly products while preserving the environment. This contributes to the development of effective and balanced business practices. The active development of agrarian bioeconomics provides a solution to such pressing issues of the Russian AIC as reducing energy consumption, restoring resource potential, and preserving the environment. Sustainable development of the AIC on the principles of bioeconomics is an innovative, almost the only effective way to overcome the technological
Y. A. Tsypkin (B) · S. L. Pakulin State University of Land Use Planning, Moscow, Russia e-mail: [email protected] I. S. Feklistova Central Russian Institute of Management (Branch) of the Russian Presidential Academy of National Economy and Public Administration, Oryol, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_13
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backlog of the Russian AIC. Essential prerequisites for the formation of bioeconomics in the Russian AIC are state support, the development of legislative norms and development programs, and the introduction of the latest biotechnologies. Keywords Agriculture · Sustainable development · Biotechnology · Bioeconomics · Innovation
1 Introduction Sustainable development of the Russian agro-industrial complex [AIC] based on the introduction of innovations and promising technologies is an urgent scientific task. It helps increase the level and quality of life and ensures the overall greening of the country’s economy. The openness of the domestic agricultural economy and the global impact on the development of the Russian AIC are directly related to the solution of environmental problems and determine the special relevance of this scientific problem. The importance of the environmental component in the development of the Russian AIC is growing every year because the complex must ensure the food and environmental security of the state and obtain environmentally safe and biologically complete products. In this case, the condition for preserving the natural environment must be fulfilled. In current conditions, the development based on bioeconomic principles is of particular importance for the Russian AIC. Taking into account the international experience, the development of biological farming, and the development and implementation of innovative biotechnology aimed at resource conservation and the use of organic agricultural waste should become essential directions. The development of agricultural bioeconomics is closely related to the formation of the appropriate institutional and legislative base and social infrastructure, taking into account the scientific developments of leading international scholars. The scientific and practical significance of the indicated range of issues and the need to combine the environmental and economic aspects of the development of the Russian AIC based on bioeconomic principles necessitate further scientific research. Russian scientists made a significant contribution to the study of the bioeconomic trends in the development of agriculture and problems of greening the economy of the AIC. However, the modern researches of most scholars are explicitly devoted to the national and regional problems of greening and development of bioeconomics. In the future, it is precisely the AIC that has the function of the core of bioeconomics. It is in the agricultural sector that will form the main raw material base, primarily renewable biomass. In these circumstances, it is necessary to update further studies of the system of bioeconomic factors and the bioeconomic potential of the Russian AIC, the development of alternative energy, and the formation of markets for organic products. Given the international experience, it is these areas that will help to ensure the competitiveness and harmony of agricultural products in Russia in the domestic and world markets.
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The purpose of the study is to identify priority areas for the sustainable development of the AIC based on the introduction of innovations and promising technologies, taking into account international experience in the development of the agricultural sector.
2 Materials and Methods The authors used a variety of methodological tools, including calculation and analytical, economic and statistical, and other research methods. A systematic approach was used to substantiate recommendations for sustainable development of the AIC based on the introduction of innovations and promising technologies, taking into account international experience in the development of the agricultural sector.
3 Results Despite the achievements of progressive world science and the availability of information, the Russian AIC is not yet marked with high levels of the greening of socio-economic development. Economic activity is mainly carried out through the exploitation of natural resources. However, the experience of developed countries suggests that the model of consumer society and the extensive use of natural potential is unpromising. For Russia, an objective necessity is a transition to environmentally friendly management based on the introduction of innovations and promising agricultural biotechnologies. In the global economy, bioeconomics is considered a young industry. Scholars predict that it will enhance the development of the society at a new socio-economic level in the future. Bioeconomics is considered an essential component of innovative modern directions for ensuring economic development [3]. It is based on the widespread use of biotechnology and the use of renewable biological resources to produce energy and goods. In EU countries, it is considered a “knowledge-based economy,” and in the US, it is a “bio-based economy.” In our opinion, bioeconomics shifted from a theoretical concept to the plane of the practical reality of a modern economy, in which renewable biological resources, their waste, and biotechnology are used to produce high-tech products and clean forms of energy [6]. Given the fact that biotechnology is used in various economic activities, we consider bioeconomics a multifunctional sector. Bioeconomics covers the entire spectrum of ecosystems, land and marine resources, biodiversity, and biological materials (plants, animals, and microbes), production, processing, and consumption. It includes agriculture, forestry, fishery, food processing, biotechnology, and chemical industry. Bioeconomics contributes to the sustainable growth and production of food, feed, energy from renewable materials, and the development of rural infrastructure. There are various approaches to identifying priority areas in biotechnology
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[1]. In our opinion, in modern conditions, agricultural and medical directions have the most significant prospects. According to the international classification of biotechnology, it is customary to distinguish its branches by color: green—agricultural and environmental biotechnology, in particular, the production of biofuels and biofertilizers; red— biopharmaceuticals, bio diagnostics; yellow—food biotechnology; white—industrial biotechnology; blue—marine biotechnology, aquaculture; gold—bioinformatics, nanobiotechnology; brown—biotechnology of deserts and arid territories; gray—bioprocesses, fermentation; black—bioterrorism, biological weapons. In 1992, in Rio de Janeiro, the UN Conference on Environment and Development adopted the concept of “sustainable development.” It is recommended for all countries of the world as a general strategy to overcome the environmental crisis. The ecological AIC is entirely consistent with this concept. An essential component of the sustainable development of the AIC is alternative management methods that have been developed for over 40 years. A theoretical justification was carried out in the countries of the EU and the USA; a legislative framework was developed, and various areas of alternative agriculture were introduced into agricultural production. In EU countries, the term “organic agricultural production” is generally accepted. In other countries, such terms as “organic farming” and “biological agriculture” are also used. Different terms are used to denote ecological agriculture in different countries. In Germany, Austria, Switzerland, France, and Italy, the term “biological agriculture” is used; in Norway, Sweden, Denmark, and Spain—“ecological farming”; in England and the USA—“organic farming”; in Finland—“natural agriculture.” Scientific research in this direction is carried out by the International Federation of Organic Agricultural Movement (IFOAM), founded in 1972. The term “organic farming” was introduced by this organization. According to the IFOAM, organic farming unites all agricultural systems that support environmentally, socially, and economically viable agricultural production [4]. The above scientific and regulatory developments indicate that it is essential for the world community to solve the problems of sustainable development of the AIC through the introduction of innovations and promising technologies. In 2002, the European Commission adopted the document “Strategy for Europe— the science of life and biotechnology.” It became the basis for the EU member states in the development of national documents on biotechnology. The published reports included the results of advanced developments using biotechnologies, outlining the prospects for further research. One of the leading programs of the European Strategy “Europe 2020” is “European Bioeconomics until 2030.” This document defines a strategic approach to the formation of the economy, which is based on the results of the introduction of biotechnology and the solution of social problems until 2030. This document should be implemented through a coordinated and comprehensive policy in the field of biotechnology. This Strategy calls for the use of bioeconomics as a critical element for meaningful and green growth in Europe. Additionally, in 2012, the document “Innovations for Sustainable Growth: Bioeconomics for Europe” was presented. It substantiates the importance of implementing advanced technologies
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in national economies, the prospects for their use, and the reduction of adverse environmental impacts. Advances in bioeconomic and innovation research allow EU countries to conduct better management of their renewable biological resources and open up new, diverse food and bio-food markets. For the Russian Federation, it is necessary to use the experience of developing and implementing EU strategies that implement the principles of bioeconomics, among which the following documents are of particular interest: Roadmap for moving towards a resource-efficient Europe until 2050; Roadmap for the transition to a lowcarbon economy until 2050; Energy Development Roadmap—2050; Competitiveness and Innovation Framework EU Horizon 2020 Initiative; Strategy and Action Plan for the Development of Sustainable Bioeconomics until 2020; Integrated industrial policy for the era of globalization; Strategic plan for the development of transport technologies. In 2010, the European Commission launched a new important strategy. Its basis is “green” growth (“Europe 2020: a strategy for smart, sustainable, and inclusive growth”). This Strategy aims to prepare the EU economy for sustainable development, efficient use of resources, and the prevention of population aging. The Strategy is based on three complementary priorities: (1) (2) (3)
reasonable growth (the development of an economy based on knowledge and innovation, as the main elements of competitiveness); sustainable growth (the development of resource-saving, low-carbon, and competitive economies); inclusive growth, that is, the development of a socially-oriented and territorially integrated economy with a high level of employment.
Russia needs to use the European experience of sustainable development actively. The topical direction of scientific research on the development of the Russian AIC is the experience of reforms of the Common Agricultural Policy (CAP) of the EU. In the development strategy of the Russian AIC until 2030, it is advisable to take into account the positive experience of implementing the program of the Common Agricultural Policy of the European Union for 2014–2020. It identifies seven priority areas of development, providing for the orientation of agricultural policy towards: – improving land relations for forming a system of transparent, effective, and socially fair conditions and guaranteeing the rights of participants; – ensuring food security of the state as a primary function of the agricultural sector; – the formation of long-term motivation for the activities of agricultural market participants by improving tax policy and budget support; – business deregulation, development of market self-regulation, and adaptation of technical regulation to international standards and requirements; – the support for multi-structure for the effective development of economic activities of the agricultural sector, depending on the motivation of producers; – increasing the competitiveness of agricultural products;
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– rational use of natural resources involved in the economic process in the agricultural sector, as well as promoting the development of organic farming and the production of alternative types of energy. The justification of practical measures for the sustainable development of the AIC based on the introduction of innovations and promising technologies should take into account the specifics of each territorial formation and the regional biogeocenoses formed in these territories.
4 Discussion The experience of European countries shows that, as part of the promotion of agricultural bioeconomics in the agricultural sector, it is possible to develop both the production of traditional agricultural products and innovative industrial biotechnological products. Its generalization gives the basis to determine the main directions and effects of the development of the agricultural sector based on bioeconomic (Fig. 1). Based on the use of the biological potential of pastures, the development of genetic characteristics of the livestock, and the orientation of the livestock industry to the bioeconomic plane will contribute to the development of highly productive beef cattle breeding. At the same time, highly efficient cereal production is developing in crop production based on the management of biological processes, soil fertility factors, and the production of traditional and new types of plant fibers. Such an approach will ensure the development of the AIC, taking into account the capabilities and integration of industries and the natural resource potential of the territories. The production of innovative biotechnological industrial products also has considerable potential: the production of biofuels based on the biotechnological conversion of carbohydrates and triglycerides of plant crops; the production of biofuels of new generations based on phototrophic crops (microalgae, bacteria, and the like); the production of a standardized feed product (for example, “synthetic barley”); obtaining biosynthetic amino acids; obtaining bio ethylene as a basic raw material resource; the production of biodegradable plastics; the production of micro cellulose and heavy-duty fibers based on biomaterials; biomedical technology. Currently, Russia has significant biomass potential that can be used for energy production. First of all, we should mention agricultural waste and energy crops. Waste from the production of sunflower (stalks, baskets, husks), waste from corn production for grain (stalks, leaves, ears of cobs), grain, and rape straws are used. The use of biotechnology creates the basis for the formation of bioeconomics as a system that uses biological resources for the production of high-tech products. Given the environmental feasibility, social importance, and focus of such a system, we believe that the development of bioeconomics is a determining component of sustainable economic development. According to researchers, every million liters of produced bioethanol creates 38 jobs. Thus, biogas enterprises form jobs not in the maintenance of the “oil pipe,” but
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Sustainable development of the Russian AIC based on innovations and advanced technologies The direction of the development The creation of new plant varieties The creation and breeding of new breeds of animals Conditions of cultivation of plant and animal cells and tissues Disposal of agricultural waste The vermicultivation (breeding of earthworms for disposal of organic waste) The production of biofertilizers The production of biological plant protection products Development effects Economic effects of the development The development of innovative technologies Reducing the cost of agricultural products Careful control of the properties of agricultural products The emergence of new agricultural products and new markets Reducing the dependence of agricultural production on energy resources The production of reusable and recyclable goods Improving the competitiveness of the agro-industrial complex Social effects of the development The diversification of the Russian agro-industrial economy and its growth The emergence of new jobs The development of infrastructure in rural areas Improving the health status of the population The creation of products with increased nutritional value Improving the quality of life of the population. The search and creation of alternative energy sources Environmental effects of the development Rational use of energy, water, and soil in agricultural production The prevention of environmental pollution Reducing emissions of greenhouse gases and other harmful substances Reducing dependence on fossil resources The production of fuel and plastics from biomass Fig. 1 Sustainable development of the Russian AIC based on innovations and promising technologies, taking into account international experience. Source Developed by the authors
in agricultural regions. The raw materials for most bioeconomic products are sugar (glucose), starch (grain, sugarcane), or cellulose (straw, sawdust). The analysis of international experience in supporting the development of bioeconomics revealed that Germany has significant government subsidies for biological farming without pesticides and chemical fertilizers. In Japan, biotechnologies have been intensively introduced since the early 1980s. With a deficit of cultivated areas, this island state fully meets the needs of the country with all types of food. At the same time, it reduces 1.7% of the sown area to eliminate overproduction. In Saudi Arabia, where desert soils prevail, bio humus and biotechnology brought from Europe made
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it possible to export for wheat and fresh cow milk. In China, the volume of investments in scientific research in biotechnology averages 2.5% of the total revenue from sales. Moreover, a third of the investment is provided by the Chinese government. In EU countries, the share of government appropriations is an average of 50%. The USA is considered the world leader in the production of biotechnological products (about 40%). In developed countries, there is a high demand for environmentally friendly products [5]. This attracts investment in the development of bioeconomics. Against this background, in developing countries, there is an intensive search for ways of bioeconomic development. Additionally, each country in the world produces its specific approach to the implementation of the concept. In Russia, the bioeconomic potential for the development of AIC is poorly used, despite a significant amount of raw materials and land areas suitable for organic production. Shortly, the main goal of the development strategy is to create the organizational and economic conditions for the innovative development of the agricultural sector [2]. This development should be based on the unity of the economic, social, and environmental interests of society for the stable provision of the population of Russia with safe and quality food, and industry with the necessary raw materials. Simultaneously, the model of innovative management for sustainable development of the AIC should become the fundamental basis for ensuring such organizational and economic conditions. Such a model should simultaneously take into account both economic and environmental parameters of agro-industrial activities, ensure environmental safety, prevent and eliminate the negative impact of economic and other activities of the AIC on the environment, and preserve natural resources [7]. To implement the conceptual approach to the sustainable development of the Russian AIC based on the introduction of innovations and promising technologies, the scientific substantiation of the organizational and economic mechanism and the corresponding tools for its regulation is relevant. In our opinion, an essential condition for developing an effective organizational and economic mechanism for sustainable development is to coordinate it at the vertical level of managing the AIC, at the level of agricultural producers, at the level of the technological chain of the introduction of biotechnology and the production of biotechnological products. At that, these relationships should not contradict each other. An essential component of such an organizational and economic mechanism is an economic incentive. On the whole, we consider the essence of economic stimulation through the prism of creating, among producers and nature users, a direct material interest in introducing the concept of bioeconomic sustainable development of the AIC. Recently, more attention was paid to stimulation since it is impossible to force producers to take specific measures during their economic activity only by administrative sanctions. We distinguish groups of tools that have a direct effect on objects of the AIC as organizational tools. These organizational tools are divided into administrative and legal. The administrative and legal instruments include institutional regulation of
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economic processes, rational nature management; stimulation of national producers to introduce biotechnology and organic production; loss recovery for misallocation of natural resources; the effect of environmental activities to fill the state budget; the formation of environmental funds. Legislative instruments include laws, standards, decrees, state cadastres, norms, regulations, permits, prohibitions, limits, and licenses. Environmental, economic instruments have side effects. The following groups are distinguished in their composition: stimulating, liability tools, and support tools. The stimulating tools include: payment (fines) for the negative impact of the AIC on the environment; limits on emissions and discharge of pollutants and microorganisms, limits on the placement of agricultural waste; tax incentives for the introduction of resource-saving technologies in agriculture, the use of secondary raw materials and the processing of production waste; tax incentives during the use of renewable energy sources; the assessment of the environmental impact of projects; compensation payments; payments and fines; preferential taxation and lending to agricultural enterprises; the establishment of increased depreciation rates for the main environmental structures; the use of premiums on environmentally friendly agricultural products; the assessment of the environmental impact of economic activities; support for innovation; forecasting the development of the socio-ecological and economic system; programs and grants in environmental protection; the auctions of a natural resource. The liability instruments include: administrative (administrative responsibility for violation of laws and regulations) and legal (loss recovery to state, regional, and local budgets) instruments. The support tools include environmental audit, environmental insurance, environmental standardization and certification, the protection of natural sites, and the reproduction of natural resources. The international experience analysis revealed that economic and economicenvironmental instruments in the system of organizational and economic mechanisms for the development of bioeconomics are strictly related to administrative and legal instruments [1]. The increasing complexity of economic relations in a market economy system necessitates the improvement of existing tools and the emergence of new ones. This should be done to regulate the development of bioeconomics and ensure resource-saving management of nature, environmental protection, and the production of organic products and raw materials.
5 Conclusion To formulate priority directions for the development of bioeconomics in the Russian AIC, it is necessary to use the best practices of developed countries that have been
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using innovative biotechnologies in agricultural production for a long time. Therefore, further analysis and evaluation of international strategic programs that determine the long-term priorities of the state regarding the development of agricultural bioeconomics is essential and relevant. International experience in regulating nature management is valuable for the Russian AIC, which, nowadays, has to determine the real priorities of modernization of economic development and environmental improvement. The conducted analysis allows us to conclude that modern biotechnology makes it possible for the Russian AIC to produce environmentally friendly products while preserving the environment. This contributes to the development of effective and balanced business practices. The active development of agrarian bioeconomics provides a solution to such pressing issues of the Russian AIC as reducing energy consumption, restoring resource potential, and preserving the environment. Sustainable development of the AIC on the principles of bioeconomics is an innovative way, almost the only effective way to overcome the technological backlog of the Russian agro-industrial complex from the developed countries of the world. Essential prerequisites for the formation of bioeconomics in the Russian AIC are state support, the development of legislative norms and development programs, and the application of the latest biotechnologies in the complex.
Reference 1. Dolgushkin NK, Kamaev RA, Orlov SV, Tsypkin YuA et al (2019) Assessment of land resources and agricultural business. Pro-Appraiser, Moscow 2. Feklistova IS, Tsypkin YA, Pakulin SL, Pakulina AA (2019) Optimization of state policy for the development of the agro-industrial complex of the region. In: Proceedings from II international scientific conference “new scientific achievements.” Tredition GmbH, Hamburg 3. Green Growth Knowledge Platform (2011) The European bioeconomy in 2030. Delivering sustainable growth by addressing the grand societal challenges. https://www.greengrowthknow ledge.org/resource/european-bioeconomy-2030-delivering-sustainable-growth-addressinggrand-societal-challenges 4. IFOAM (2019) The world of organic agriculture 2019. Key indicators and leading countries. https://www.ifoam.bio/en/news/2019/02/13/world-organic-agriculture-2019 5. Lernoud J, Wille H (2019) Organic agriculture worldwide: key results from the FiBL survey on organic agriculture worldwide, 2019. Part 1: Global data and survey background. Research Institute of Organic Agriculture, Frick. https://www.organic-world.net/fileadmin/documents/yea rbook/2019/FiBL-2019-Global-data-2017.pdf 6. Pakulin SL, Tsypkin YA, Feklistova IS, Pakulina AA, Pakulina HS (2019) Priority areas of scientific and technological development and digital technologies in the management of the agricultural sector. In: Proceedings from XXXXI international scientific conference “new prospects for the development of our science.” Lulu Press, Morrisville 7. Tsypkin Y, Feklistova I (2019) Assessing the efficiency of management and land use in the agrarian sector of municipalities. In: IOP conference series: earth and environmental science, vol 274, p 012089. https://doi.org/10.1088/1755-1315/274/1/012089
Development of Export-Oriented Organic Agriculture Based on Bio-Intensive Technologies Valentina A. Kundius
Abstract The paper substantiates the objective prerequisites and necessary conditions for the development of export-oriented organic agriculture in Russia based on bio-intensive technologies, ecosystem management, the improvement of production and market infrastructure, the certification of organic products, and training of specialists with relevant qualifications. The main factors slowing down the development of organic agricultural production in Russia were identified. It is substantiated that scientific research should be comprehensive, aimed at maintaining and improving soil fertility, the quality and certification of organic products, the formation of ecosystem management, and increasing the economic efficiency of organic agriculture. Bio-intensive technologies and a regional model for the development of organic agriculture in the territories of the Great Altai are presented. Keywords Organic agriculture · Bio-intensive technologies · Problems · Prospects · Innovations · Ecosystem management
1 Introduction Improving the quality of life, the desire for rational and healthy nutrition of the population in almost all regions of the world led to increasing demands for natural, environmentally friendly food products and the need to transfer agricultural production to a qualitatively new level. However, the solution of such a global problem involves not only the development and adaptation of agricultural production technologies to organic farming methods, the natural and environmental conditions of the area, and the environmental requirements of the produced food, but also the improvement of management systems, production and market infrastructure, market relations, relevant research, and recommendations. Our research is oriented toward solving the indicated problems. Some of the results are presented in this paper. V. A. Kundius (B) Altai State Agricultural University, Barnaul, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_14
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2 Materials and Methods In solving the problem of developing organic agriculture in the world, Russia is positioned not only as a traditional agricultural food producer but also as a potential producer and exporter of organic (environmentally friendly) food products, as well as raw materials for the production of biofuels (rapeseed and rapeseed oil). At the same time, Russian land resources are the object of increased attention from the world community and transnational corporations. In this regard, it is necessary to ensure the conservation of land as a guarantee of national and food security to rationally manage this unique natural resource. The experts of the Ministry of Agriculture of the Russian Federation emphasized that in 15–20 years, Russia may occupy up to 10% of the world market for agricultural production. Organic agriculture may become a new sphere of global influence. The Russian Federation has everything to occupy leading positions: an immense natural potential, vast reserves of freshwater and fertile land, etc. For example, currently, the countries of the Asia-Pacific region are considering Russia as a territory for producing an assessment of producer support. This is especially true for the Far East of the country, which is the “young” zone of agriculture, since “150 years is not the time for land” [3]. According to IFOAM [3], organic production is currently developed in 178 countries, while 87 of them have formed or are forming their regulatory framework. In 2018, Russia was among the latter. Currently, the latest officials show that there are 2.7 million organic producers globally, with a market volume of $89.7 billion. At the same time, the market for organic products is growing regardless of global crises. Organic production in Russia is carried out following Federal Law No. 280FZ dated August 3, 2018 [5]. It implements the legal regulation of relations and requirements for the production of organic products. Additionally, regulatory documents were amended to regulate the recognition of international standards for organic production in the EU Commission Regulation No. 889 [5, 9]. It is scientifically proven that the climatic factor has a significant impact on soil formation, but the systems and technologies of land use can also improve the quality and environmental conditions of the land resource. Based on the international experience in organic agricultural production and the developments of Russian scholars, domestic producers in the agricultural sector, focusing on the export of agricultural products and food, turn agricultural production into alternative and innovative methods based on bio-intensive technologies. The basis of the land use of such organizations is the use of an ecological fertilizer system that allows using chemical fertilizers, lime, and organic and green fertilizers instead of natural chemical fertilizers. In such a management system, agrotechnical soil cultivation is energy-saving or combining plowing and surface soil cultivation following the requirements of the climatic and territorial-landscape conditions of the area, and the use of combined units.
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Over the past two decades, domestic agriculture attempted to introduce organic farming methods into agricultural production and set up specialized companies for the cultivation and processing of organic agricultural products in various Russian regions. Currently, over 50 certified organic agricultural enterprises located in the main regions of the Black Earth region (the Tula, Kursk, and Belgorod Regions, Bashkiria, Siberia (the Omsk and Novosibirsk regions)), in the north-eastern part of Russia (the Arkhangelsk region), and the south of Russia (in the Stavropol Krai) are successfully operating in the territory of the Russian Federation. Certified domestic agricultural enterprises export the following organic products to foreign countries: wheat (to the EU countries), buckwheat, millet, alfalfa, flax fiber, and wild plants (berries, mushrooms, herbs, pine nuts). Some enterprises specialize in the production and processing of environmentally friendly medicinal plants, sea buckthorn, and Aronia; they cultivate and process oats into oatmeal for diet and baby food. It should be noted that a significant share of such farms was formed with funding and support from several Eurozone countries (Germany, Switzerland, and Denmark). The main part of the products manufactured by these enterprises is supplied to ecological markets of European countries, which make producers of environmental products dependent on market conditions, inhibiting their orientation to the domestic market of eco-friendly products. The main part of the products manufactured by these enterprises is supplied to the ecological markets of European countries, which make producers of environmental products dependent on market conditions, inhibiting their orientation on the domestic market of eco-friendly products: – A comprehensive and focused system of theoretical knowledge and practical training in organizing organically oriented agricultural production was not formed in Russian agricultural education; – The development of the market for organic products is low. Thus, in foreign countries, organically oriented agriculture is profitable only within the framework of the agricultural ecological market, where strict regulation of certain rules and principles is established. The practice of farming focused on the production of organic products proves that consumer preferences are a fundamental factor in the development of organic markets. The foreign markets of eco-food mainly target consumers who are willing to buy a quality product at a higher cost. In Russia, there are also a sufficient number of people who can buy organic products. A food market segment is being practically formed, aimed at consumers who care about their health and the health of their loved ones. First of all, children (baby and diet food), people with poor health, patients undergoing rehabilitation and spa treatment, people with food allergies, and agritourists should consume organic products. In the Altai Krai and Mongolia, there are significant land resources of former and existing agricultural enterprises of various ownership forms, withdrawn from circulation, or used inefficiently. This allows us to place different types of farm animals following existing (significantly exceeding in industrial animal husbandry) standards for agricultural organic production [7]. Therefore, it is necessary to provide
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for dairy cattle an area of not less than 6 m2 per animal in enclosed spaces and not less than 4.5 m2 in the fields. Also, the lack of funds led to the fact that about half of the agricultural enterprises operating in the Altai Krai in recent years did not use pesticides and herbicides at all, nor were they engaged in artificial enrichment and increasing the yield of hayfields and pastures. Therefore, at least half of the sown area and other farmland can be used for organic production [2, 8]. Additionally, there is now an objectively low employment rate in rural areas with an overabundance of labor; the majority of peasants refuse to work for meager wages. This, to a certain extent, will make it possible to reduce the cost of organic products, thereby making them competitive not only in the domestic but also in the foreign market. The importance should be given to scientific research in the direction of forming a strategy for the transition of a particular segment of agricultural producers to the organic way of farming. We believe that research in agricultural greening should be comprehensive, aimed both at maintaining and improving soil fertility, the quality and certification of organic products, the formation of ecosystem management [7], and increasing the economic efficiency of organic agriculture. The organization of crop production in agricultural production should be considered from a systematic approach. The organizational and technological basis of crop production is the agricultural system, which consists of the following components: crop rotation systems, seed production systems, plant protection systems, soil cultivation, and crop care systems, land reclamation, and irrigation systems. The profitability of crop production depends on the interaction of the presented elements that determine soil fertility and increase crop yields and land-use efficiency [1]. The list of organizational and economic elements of the system for managing the crop sector includes the organization of industrial and economic use of agricultural land, planning and implementation of a rotation system, and organizational methods for managing the industry. The organization of industrial and economic use of land resources is associated with determining the status of industrial and economic lands and the characteristics of the farming systems of each land plot. This also includes the formation of agricultural land composition for the future, the development of types and systems of alternating crop rotation fields, and their territorial distribution [4]. Equally important in the measures for improving the efficiency of the crop production system is the economically sound rotation system. The importance of crop rotation in land use is due to the correct determination of the saturation of the soil with a leading crop, the selection of the best predecessors from the number of produced crops, the formation of a positive balance of organic matter in the soil, the improvement of the sanitary and ecological condition of the soil, and the improvement of its fertility. In organizational and economic terms, crop rotation is presented as the main factor in the rational use of land, production assets, and labor resources. Its result is the profitability of production and economic activities of the agricultural organization [6, 10].
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The design and implementation of a crop rotation alternation system in an agricultural enterprise should be carried out, taking into account the market conditions that determine the development strategy of enterprises, following its goals and organizational and economic structure. Crop rotations are designed for each on-farm production unit in close connection with the structure of sown areas [10]. The main task in the formation of a rational structure of sown areas is to increase soil productivity, ensure the implementation of the plan for the production and sale of agricultural products, produce the required amount of products to meet the internal needs of the enterprise, increase the profitability of the crop sector. When designing a rotation system for crop rotation and substantiating the rational structure of sown areas, one should proceed from an economic assessment of produced crops by a set of indicators. Thus, for food and industrial crops, the indicators will be yield and profit per 1 ha of cultivated area, labor intensity and cost of 1 centner of manufactured products, the level of profitability of the produced crop. For fodder crops, the indicators will be the yield of fodder protein units per 1 ha of crops, the complexity of fodder crop production, the cost of one fodder unit. Consequently, the rotation system and the rational design of the crop area are the elements of the organizational and economic mechanisms of the land-use system designed to ensure the production of grains, vegetables, industrial forage crops, and potatoes in the land resources planned by the enterprise. The effectiveness of the tasks set for agriculture will depend on it. In organic animal husbandry, the rules for keeping and handling animals, the organization of feeding, the prevention of diseases, and the treatment of animals are strictly regulated. The rules for the conduct of the branches of beekeeping, aquaculture, and production of organic food and feed are highlighted separately. In the Altai Krai and the territories of Great Altai, there are necessary conditions and prerequisites for the development of export-oriented organic agriculture [6]. The regional model for the development of organic agriculture in the territories of the Great Altai should be built in the following areas: – The generalization of the regulatory framework for the production and turnover of organic products with specified characteristics; – The formation of a certification system for organic products at the global level; – marketing research on the demand for organic products in domestic and foreign markets; – The analysis of international scientific and practical experience and the development of a forecast for the production, turnover, and use of organic crop and livestock products in the region; – Retrospective and operational analysis of feed for organic livestock; – The development and implementation of bio-intensive technologies in organic agriculture using permitted processing methods; – The formation of ecosystem management;
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– The development of a wide network for informing consumers and producers about the methods of voluntary certification of organic livestock products and the advantages and features of organic animal husbandry technology.
3 Conclusion It is possible to improve the economic efficiency of organic agriculture by improving innovative technologies and moving to a new level of organization of production, taking into account the factors of not only economic but also environmental production. A significant role is given to the implementation of agricultural systems adapted to the territorial conditions of agro landscapes that do not cause environmental harm to the natural environment and are oriented towards the constant growth of soil fertility based on bio-intensive technologies. Acknowledgements The paper was prepared and published following the research plan with the financial support of the Russian Federal Property Fund for the grant for the implementation of the scientific project No. 19-510-44011 “The creation of the concept of development of organic agriculture based on advanced methods and technologies.”
References 1. Bartov VF, Sedov VV (1984) Concepts of the interaction of economics and nature. Mysl, Moscow 2. Bazdyrev GI (2000) Greening of agriculture. Kolos, Moscow 3. Federal Center for Agricultural Consulting of the Agricultural Complex (2017) Media review January 16–23, 2017 (organic). https://mcx-consult.ru/d/77622/d/obzor_smi_16_23_ 01_2017_organika.pdf 4. Gorlov I, Shishkunov V, Mosolova N (2012) New approaches to ensure the environmental safety of agricultural production. Milk Meat Cattle Breeding 7:21–24 5. IFOAM (2017) Annual consolidated report. https://ifoam.bio/ 6. Kundius VA, Voronkova OYu, Streltsova TV, Perova TN (2018) Prospects for ecological agriculture in Altai. Agric Russ 1:26–32 7. Russian Federation: The federal law “on organic products and on amending certain legislative acts of the Russian Federation” (August 3, 2018 No. 280-FZ) (2018). https://www.consultant. ru/document/cons_doc_LAW_304017/ 8. Voronkova OYu, Kundius VA (2014) Organizational and economic substantiation of the prerequisites for the development of organic (ecological) agriculture in the Altai region. Bull Altai Sci 2:124–128 9. Willer H, Lernoud J (eds) (2017) The world of organic agriculture statistics and emerging trends 2017. Research Institute of Organic Agriculture (FiBL) and IFOAM – Organics International, Frick. https://www.mm.dk/pdffiles/3503-organic-world-2017.pdf 10. Zhuchenko AA (1994) The strategy for adaptive agricultural intensification: concept, Pushchino, Russia
Spatial Development of Agricultural Production: The Evolution of Views and Scientific Approaches Olga V. Solntseva
and Marina L. Yashina
Abstract The study performs a retrospective analysis of the basic principles and scientific approaches of the spatial development of agricultural production as a complex and multidimensional phenomenon associated with the interaction of climatic, organizational, technological, social, and economic factors. The combination of general scientific approaches of systemic, dialectic, empirical, and other methods made it possible to establish the relevance of the spatial organization of agricultural production in current conditions. The paper proves the need for the growth of the economy of the country using the potential of each region and interregional cooperation based on the model of differentiated spatial growth. To justify the rational spatial development of territories and classify the types of state participation, the authors proposed a classification of spatial development factors, among which priority is given to natural and socio-economic conditions. Four blocks of indicators of the spatial development of agricultural production identified by the authors determine the level of bioclimatic potential of the territory, the efficiency of agricultural production and processing of agricultural raw materials, the level and quality of food consumption, and the degree of accessibility of food. They can be used to form specialized zones for the production of certain types of food, establishing a priority state regulation of the territorial development and justification of interregional exchange directions. Considering that the spatial development of agriculture solves a significant part of industry issues, including its management system and the socio-economic development of rural territories, the presented scientific approach is relevant and has scientific novelty. It allows the scientific community to find ways of ensuring the development of a huge and sparsely populated space of the country, focusing it directly on a person, especially living and working in rural areas. Keywords Rural areas · Spatial development · Typology of regions · Specialized zones · Potential · Efficiency · Socio-economic development · Regional agricultural policy
O. V. Solntseva · M. L. Yashina (B) Ulyanovsk State Agrarian University named after P. A. Stolypin, Ulyanovsk, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_15
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1 Introduction The spatial development of agricultural production is a natural, complex, and multifaceted process of the social division of labor. Historically, in Russia, it developed ahead many economically developed agrarian states. However, over the past few decades, the country quickly lost ground in the world. The spatial organization of agricultural production took on an almost spontaneous character and lost its scientific and practical significance. The foundations of the formation of views on the spatial development of agricultural production were laid down by the classics of political economy, the economists of the manufacturing era A. Smith and D. Ricardo [9] in the theory of absolute and comparative advantage. I. G. Thünen [12], V. Kristler, V. Launhardt, and A. Weber [13] made a significant contribution to the development of the interregional exchange theory. Classical location theories were further developed in the concept of territorial integration [5]. Since the 1930s, the ideas of the school of the spatial organization were actively developed [3]. Economic and geographical theories identified the main advantages of territories in the form of technological specialization, the development of cooperation, and the agglomeration effect [8]. Modern science [2] proves the need for the growth of the economy of the country using the potential of each region and the development of interregional cooperation. The methodological diversity of modern scientific approaches clarifies the basic concepts of location, identifies factors and conditions of territorial development.
2 Materials and Methods The combination of methods of scientific knowledge (historical, logical, analytical, comparison, classification, scientific abstraction, and synthesis) allows us to conduct a retrospective analysis of the key provisions of the spatial development of territories as a complex and multidimensional phenomenon associated with the interaction of natural-climatic, organizational, technological, social, and economic mechanisms. It also allows identifying the factors that determine the spatial development of agricultural production, its comparative advantages, and regional specialization, as well as to substantiate a system of indicators of spatial development. General scientific approaches to systemic, dialectic, and empirical methods are used to substantiate the reliability of the research.
3 Results Russian economy is based on a resource-oriented development model marked with the uneven development of territories, the consolidation of city centers, and the
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devastation of peripheral zones in the overall balance of spatial development. The attempts of overcoming this situation were made in several normative acts, including the Strategy for Spatial Development of the Russian Federation up to 2025 [4], in which the socio-economic and spatial development of the country is based on the principles of a polarized development model with an emphasis on leading regions and priority development of agglomerations. The model is marked with increased links between major cities and transport hubs that structure the territory. The main factors in the spatial development of territories are the advantages of agglomeration effect and globalization processes. On the other hand, there are supporters of the model of differentiated spatial growth [7], which assumes the comprehensive development of each region and maximization of the use of its potential. The essence of the model of state regulation of space is that each region is unique not only from an economic point of view, but also of its human potential, traditions, and culture. Urban and rural territories form a mosaic of spatial development, which unique identity should be supported by regional governments and local authorities. The distribution of demographic and economic growth and investment is concentrated in regions with a unique identity. At the same time, the objectives of the regional policy are: to strengthen the socio-economic balance of the regions, realize their underutilized potential, activate factors of internal development, support municipal initiatives, develop intra-regional transport infrastructure, maximize the potential of inter-regional interaction, enhance innovative business and management practices. It is important to note that the Strategy [4] defines only the general features of spatial development, and the question of the scientific and methodological foundations of its construction remains open. The development of measures for improving the spatial development of agriculture begins with the typology of regions, identification of large-scale zones with different production and processing capabilities, different levels of production efficiency, and food availability. The identification of specialized zones and the determination of their role in the food supply is a complex process combining the classification of regions according to a variety of factors, economic and mathematical modeling of the territorial development of the allocated zones, and substantiation of optimal measures of state regulation of spatial development. Thus, each region is marked with a certain level of efficiency of agricultural production, processing of agricultural raw materials, and the degree of food availability. Depending on the priority and effectiveness of regions, the directions of regulation of spatial development of territories are determined, aimed at maximizing the use of agricultural potential or social development programs. The formation of specialized zones for the production of agricultural raw materials and certain types of food will substantiate the directions of interregional exchange.
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4 Discussion The development of the territorial organization and the increase of food supply for the regions requires the formation of specialized large-scale zones, the development, and improvement of inter-regional raw materials and food relations. A specialized zone for agricultural production is marked with specific economic and geographical unity, the identity of natural and economic conditions, and the features of the social and cultural development of territories that determine agricultural production specialization. In the Strategy for Spatial Development [4], promising economic specializations are represented by enlarged groups of agricultural sub-sectors and their products (beverage production, food production, fishing and fish farming, plant growing, livestock, provision of services in these sectors). These groupings, according to A. I. Altukhov [1], do not allow judging the rational distribution of individual subsectors of agriculture and the production of certain types of agricultural products, raw materials, and food. According to the authors, the classification of Russian regions should combine the factors that determine the priority specializations of the regions: economic, technological, organizational, natural, and social (Fig. 1) [10]. Based on the totality of the noted factors, the regions are grouped into large-scale specialized zones, which makes it possible to substantiate measures of state regulation of the spatial development of agro-industrial production for each of them. In the classification of regions, the primary role belongs to natural and socioeconomic conditions. The latter are also restrictions on the economic affordability
Fig. 1 The classification of factors of classification of regions. Source [10]
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of food consumption. It is important to classify the regions correctly to eliminate the social inequality of the population of different territories and optimize the use of limited resources when substantiating the optimal type of intervention. There are various typological methods based on the assessment of the values of classification factors. W. Marivoet and colleagues [6] propose a three-level classification of regions according to priority of the state intervention on the economy: high, medium, and low. The classification is proposed based on the values of four main factors characterizing the effectiveness of regions, depending on whether their values fall within the range below 75%, above 125% of the average level for the country, or in the interval between these thresholds. The question of choosing a criterion for assessing the efficiency of territory development (municipality, region, and specialized zone) remains debatable. From economic efficiency, the productivity of the region can be assessed by the role of the territory in the total production of one or another type of food in the country or the level of profitability of agricultural production in the region. It is possible to apply another approach to assessing the effectiveness of the region, where the main factors are social ones, i.e., the level of population satisfaction in food or the availability of food products. Then, the indicators are the consumption of certain types of food per capita or the deviation of the level of consumption from rational norms. To justify the rational spatial development of territories and classify the types of government interventions, it is advisable to use a system of indicators that includes four blocks: 1. 2.
3. 4.
The bioclimatic potential of the territories (taking into account the biological productivity of the climate: moisture supply and temperature conditions); A system of indicators determining the volume and efficiency of production of agricultural raw materials and food, as well as the production capacity of the processing industry; Indicators characterizing the level and quality of consumption, as well as the needs of the population in certain types of food to ensure healthy nutrition; A group of social indicators that determine the standard of living and food availability (average per capita income, solvent demand, level of development of social infrastructure, and population density).
Using the data for each of the four blocks, it is possible to evaluate the performance of any territorial unit compared to the national average in terms of potential availability, the efficiency of agricultural production, processing capabilities of agricultural raw materials, level and quality of consumption, and the degree of food availability. Thus, the efficiency of a region is determined by a combination of three factors: the level of use of resources and bioclimatic potential in food production, the level of food availability in terms of socio-economic indicators, and the level of food consumption. In countries with a socially oriented economy, the priority of government participation should be determined by the level of food consumption relative to rational nutrition standards. Depending on the average level of food supply in the country, the upper and lower borders of consumption in different countries may
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differ. Such analysis is of direct practical importance. It can also lead to the development of more important recommendations regarding the management policy of the spatial development of the territory since the lag of the region from its average national indicators will be more eloquent than the lag in relation to any unattainable technological ideal. An essential consequence of this adjustment is the transition from absolute to relative benchmarking. M. Torero [11] identifies seven common types of territories for state intervention in their spatial development: 1. 2. 3. 4. 5. 6. 7.
High level of production and use of resources with food availability above average. High level of production and use of resources with food availability below average. The average level of production and use of resources with food availability above average. The average level of production and use of resources with food availability below average. Low level of production and use of resources with food availability above average with high consumption. Low level of production and use of resources with food availability above average with low consumption. Low level of production and use of resources with food availability below average.
The considered methodology for classifying regions based on information on the level of food consumption and agricultural potential allows us to identify low-priority and high-priority regions according to the need for state intervention. At the same time, we get information about which of these regions have more production capabilities, and which directions exist to increase their potential. One of the advantages of this technique is that we can limit ourselves to four indicators for the analysis of a small amount of data.
5 Conclusion Given that the spatial development of agriculture solves a significant part of the industry’s issues, including its management system, and the socio-economic development of rural areas, the results of fundamental scientific research of agroeconomic science in the field of spatial development of agricultural production should answer the question of how to develop a huge and sparsely populated territory of the county, focusing it directly to a person, especially living and working in rural areas. To achieve the stated goal of the spatial development of agricultural production, it is required to abandon regional competition, turn to regional cooperation and integration in agriculture, develop technologically advanced specialized production zones for certain types of agricultural products, and improve interregional exchange. One of the tools to achieve this goal is the combined typology of regions that combines
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a resource and social approach. A clear definition of the reasons for restraining the development of the industry in the regions, and comparing them with the average level will help identify priority areas of investment and increase the efficiency of their return. A reliable typology of regions provides the first level of information necessary for making managerial decisions in food policy and allows focusing on food security bottlenecks.
References 1. Altukhov AI (2019) Food security paradigm of Russia. Youth Development and Support Fund “Personnel Reserve”, Moscow 2. Altukhov AI, Silaeva LP, Vinnichek LB, Soloshenko RV, Piriev JS, Davlatov KK, Neretin MV (2016) The methodology of rational allocation and deepening of specialization in agricultural production. Irfon, Dushanbe 3. Blaug M (1996) Economic thought in retrospect. Delo, Moscow 4. Government of the Russian Federation (2019) The strategy for the spatial development of the Russian Federation for the period until 2025 (February 13, 2019 No. 207-r), Moscow, Russia 5. Isaev BA (2007) Geopolitics. Peter, St. Petersburg 6. Marivoet W, Ulimwengu J, Sedano F (2019) A spatial typology for targeted food and nutrition security interventions. World Dev 120, 62–75. https://www.sciencedirect.com/science/article/ pii/S0305750X19300750?via%3Dihub 7. Mikheeva NN (2018) Spatial development strategy: new stage or repetition of old mistakes? ECO 5:158–178 8. Saveliev YuV (2010) Theoretical foundations of modern interregional competition. J Econ Theory 2:86–98 9. Smith A (2007) The research on the nature and causes of the wealth of peoples. Eksmo, Moscow 10. Solntseva OV, Yashina ML (2018) The evolution of views and scientific approaches to the location of production and specialization of rural areas. Bull Kursk State Agric Acad 7:196–200 11. Torero M (2014) Targeting investments to link farmers to markets: a framework for capturing the heterogeneity of smallholder farmers. In: Hazell PBR, Rahman A (eds) New directions for smallholder agriculture. Oxford University Press, Oxford. https://doi.org/10.1093/acprof 12. von Thünen JH (1826) Der isolirte Staat in Beziehung auf Landwirthschaft und Nationalökonomie, Hamburg, Deutschland. https://www.deutschestextarchiv.de/book/view/ thuenen_staat_1826/?hl=Thu%CD%A4nen&p=9 13. Weber A (1926) On the placement of industry. The pure theory of standard. https://vuzlib.net/ beta3/html/1/4055/4068
Globalization of the World Economy and Its Impact on the Development of the Russian Agricultural Sector Galina N. Likhosherstova , Elena V. Nejelchenko , Yuliya I. Zdorovets , and Svetlana N. Yasenok
Abstract This paper examines the trends of the world economy, globalization, and their direct influence on the state and development prospects of the Russian agricultural sector. The study proves the importance and significance of the agricultural sector as one of the least stable and most unpredictable sectors of the world economy. It assesses the state of the Russian agricultural sector. The problem areas of the agricultural sector identified during the study allowed us to form several strategic directions, the implementation of which will contribute to the full use of the potential of the Russian market for agricultural products. Keywords Globalization · Integration · Development strategy · Agricultural complex · Agricultural sector
1 Introduction The modern economy and emerging global trends mark an era of globalization and digitalization in which there is no place for outdated forms and methods of public administration and management. From the European point of view, the process of globalization is a process of multi-level integration (integration, due to being part of the globalization system, contributes to the fusion of national markets in various spheres), within which state sovereignty is transformed.
G. N. Likhosherstova · E. V. Nejelchenko · S. N. Yasenok Belgorod State National Research University, Belgorod, Russia e-mail: [email protected] S. N. Yasenok e-mail: [email protected] Y. I. Zdorovets (B) Belgorod State Agricultural University named after V. Gorin, Belgorod, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_16
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The main features of the globalization process are as follows: 1) 2) 3) 4) 5) 6)
the emergence and the manifestation of problem areas associated with the exhaustion/lack of resources and consumption problem; the increase in the population of the planet affecting the demographic structure; the problem of generating biosphere resources (according to forecast estimates and calculations, the projected annual decline may amount to about 1%); the introduction of more advanced technological systems in different national spheres, resulting in a loss of manageability of these systems; the growth of political differences (geo-political globalization) requiring the participation of other countries for their coordination and resolution; socio-cultural transformation in various spheres, such as education, culture, etc.
Nowadays, globalization is an active element of the world economy. It is a mechanism that can influence the further development of our planet as a unified economic space. Although the world market is divided into several regional and/or national protected markets, there is a clear trend towards the globalization of the world economy. Its impact can be observed in world agriculture due to the global significance of the current food problem. Meeting the increasing needs of the population in food products is the main task of the agro-industrial complex [AIC] in the globalized economy. AIC is an intersectoral complex that combines various industries focused on producing and processing agricultural raw materials, manufacture, and marketing of finished products following societal needs and the demand of the population. In this regard, the role of the AIC in the sectoral structure of the world economy is increasing. The beginning of the 21st century was marked with the intensification of the agricultural sector and its active integration with the industrial sector, resulting in global changes in several areas of the world economic space. The currently formed world agro-industrial system is a global multi-industry complex based on three areas, each of which corresponds to a particular area of science and personnel training within the education system. The modern structure of a unified world AIC virtually covers all countries of the world, which is why the AIC should be ranked among the most important economic complexes. It determines the conditions for maintaining the social life but also affects the employment of the rural population and the formation of food security of the territory. In turn, the current development of the world AIC is driven by several emerging global trends in the economic space marked with the following features: 1) 2) 3) 4)
constant build-up and growth of inter-industry cooperation; the steady growth of agricultural production volumes primarily caused by the intensification of production; changes and modifications to the global structure of agricultural products consumption; the most widespread use/application of chemicals and fertilizers in agricultural production, including the production of artificially created plant varieties and more productive livestock.
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2 Materials and Methods To establish the influence of globalization on the development of the Russian agrarian sector and to assess and diagnose the condition of the agricultural sector and its territorial space, we developed scientifically grounded practical recommendations based on statistical data. The targeted validity of the studied problem reached through the creation of a highly efficient modern agricultural complex meeting international standards will improve the conditions and quality of life of Russian citizens. It will also increase the competitiveness of social sectors in rural areas and ensure that the threshold values of the Food Security Doctrine of the Russian Federation are met based on the estimated demand for crop production (Fig. 1). Figure 1 shows that the fulfillment of the threshold values defined by the Food Security Doctrine of the Russian Federation exceeds the production level of the established threshold values for some indicators, while other indicators (horticultural and vegetable products) demonstrate minor deviations from the established crop product norms (Table 1). Compliance with the established crop production parameters is an important direction in ensuring national security and sovereignty. It is also one of the necessary conditions for one of the strategic national priorities—an increase in quality and standard of living for the Russian population. Thus, the basic platform for the formation and implementation of practical recommendations based on the systematization of available and compiled (during this research) data on the Russian agricultural potential allows us to develop strategic forms and directions for the further development of the agricultural sector of the Russian Federation on their basis.
Fig. 1 The fulfillment of threshold values defined by the Food Security Doctrine of the Russian Federation (2017) Source [4].
132 Table 1 Annual demand and manufacture of crop production per person, 2017
G. N. Likhosherstova et al. Products by type Demand (factual kg)
Fact (kg)
%
Grain
650
912
140.3
Potato
90
203
225.6
Vegetable oil
12
35
291.7
Sugar
24
42
175.0
Vegetables and cucurbits
140
128
91.4
Fruits and berries
100
20.1
20.1
Source Calculated based on [1]
3 Results The analysis of cross-country comparison of the agricultural sector in terms of agricultural resource provision has shown that Russia is the current world leader in terms of the area of all agricultural land. The changes in the Russian land area, including changes in agricultural land area by year, are shown in Table 2. Even though Russia has a large land area, most of it is located in the Northern regions of the country. Therefore, the total area of agricultural land amounts to about 13%, with only 8% of it being arable. Russia possesses 10% of all arable land in the world in its turnover. However, as can be seen from Table 1, the volume of agricultural land is steadily growing every year. This growth ensures the attraction of subsidies and obtaining preferential loans from Russian banks. These aspects belong to the positive zone of the balance of interests. The structural features of the cultivated area are shown in Fig. 2. The diagram in Fig. 2 shows that the largest share in the structure of cultivated areas is grains and legumes, which are mainly export-oriented. Russia occupies a leading position in the world grain market (wheat in particular), and, therefore, the volume of grain production by Russian enterprises is significantly higher than domestic consumption. At the same time, 50% of the consumed grain goes to the food industry, and the remaining 50% goes to the production of compound feeds. The structural distribution of agricultural production by type of farm in Russia is mainly oriented to agricultural organizations of a larger order, in contrast to Europe, where farming is largely supported (Fig. 3). At the same time, it should be noted that the current programs for the development of agriculture in Russia include stimulating methods of support and development of various forms of farming, which, in turn, ensures the stability of growth indicators of the agricultural sector. Nevertheless, despite the positive aspects, there are still several unresolved problems: low profitability, debt, significant interest rates, stagnation in industry renovation, and modernization of the technical base. Thus, the conducted research, recent trends, and economic analysis of the results of the Russian agricultural sector allowed us to draw several conclusions. Firstly,
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Fig. 2 The structure of the Russian cultivated area. Source [2]
Table 2 Russian land area, 2017 Land
Years 2001
2006
2015
2016
2017
Total land (million ha)
1,709.8
1,709.8
1,712.5
1,712.5
1,712.5
including agricultural land
221.1
220.7
220.2
222.1
222.0
As % of the total area Total land (million ha)
100
100
100
100
100
including agricultural land
12.9
12.9
12.9
13.0
13.0
Source [1]
agriculture is one of the main elements of the Russian economy. Secondly, the share of employment in agricultural production was recently on the decrease due to different factors. However, the overall efficiency of the sector was preserved (the preservation of efficiency is fundamentally essential to agricultural production) and began to increase. This allowed to provide, maintain, and continue the positive trend within the increasing export of agricultural goods. In August 2014, several countries imposed restrictions on imports of agricultural products to Russia, which led to the decline in imports by a factor of 1.46. However, by 2018, with a noticeable increase in the export of food products and agricultural raw materials, the total volume of export increased 1.53 times compared to the pre-sanctions period in 2013. It should also be noted that the share of the agricultural sector in the gross national product saw a slight increase. Currently, it stands at 4.36% (Table 3). In general, the model of increasing the role of agricultural sector in the economy, actively implemented over the past five years, has yielded its results. It allowed Russia to increase agricultural exports gradually and, thus, ensure the food independence in key products. Therefore, in 2018, the main export items of agricultural products in Russia were as follows:
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Table 3 The share of the agricultural sector in the Russian economy, % 2011
2012
2013
2014
2015
2017
In GNI
3.73
3.51
3.43
3.87
4.33
4.36
In the working population
7.7
7.3
7.0
6.7
6.7
6.7
In main funds
2.9
2.8
2.8
2.7
2.7
2.6
In investments
4.1
3.8
3.8
3.7
3.6
4.1
In budget expenses
1.36
1.19
1.43
1.14
1.22
1.06
In export
2.6
3.2
3.1
3.8
4.7
6.0
In import
13.9
12.8
13.7
13.9
14.6
13.7
Source [1]
Fig. 3 The structure of agricultural production by farm types. Source Developed by the authors
1) 2) 3) 4) 5) 6)
Grain—wheat, barley, and corn (42% of the total export of agricultural products); Oilseeds (18.2% of the total agricultural exports); Seafood and fish (17.2% of total agricultural exports); Meat (1.6% of total agricultural exports. In 2013, the export of meat amounted to 0.2%); Other confectionery products containing cocoa, including chocolate (2.3% of total agricultural exports); alcoholic and non-alcoholic beverages (2.2%), products of flour and grain production (1.1%).
While assessing the dynamics of agricultural exports, it should be noted that in 2015 exports amounted to about 14.7 billion dollars. In 2018, this figure reached the level of 25.8 billion dollars (according to the forecasts of the President of the Russian Federation, V. V. Putin, the export of agricultural products is expected to reach 45 billion dollars in 2025). This can be regarded as positive dynamics in the development of the Russian agricultural market. Along with the key export items, we should highlight the key import items of agricultural raw materials and products in Russia established in 2018: 1)
fruits including bananas, apples, and citrus (17.1% of total agricultural exports);
Globalization of the World Economy and Its Impact ... Table 4 The position of Russia in the world rating of various agricultural production categories, 2015
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Types of agricultural products
Russian position
Sugarbeet
1
Potato
3
Grains and legumes
4
Livestock and poultry for slaughter (in slaughter weight)
4
Cow milk
6
Source [1]
2) 3) 4)
milk and dairy products including milk powder, whey powder, cheese, cottage cheese, and butter (7.9% of total agricultural exports); crop seeds for seeding, oilseeds, and fruits (6.4% of total agricultural exports); other, including vegetable products (6.2%), fish and seafood (6.1%), vegetable oils (palm oil forms the basis of this category amounting to 4.5%).
While analyzing Russian imports of food, it should be emphasized that currently, food imports still exceed the exports in value terms. However, the gap between them is gradually decreasing. If the current dynamics continue, food exports may exceed imports as early as 2020. For example, we can cite agricultural production categories, where Russia occupies a stable leading position in the world rating of agricultural production (Table 4). The data allows us to see that Russia has practically become import independent in meat and dairy products, as well as sugar and potatoes. As a result of the active policy of the government in increasing agricultural production by all commodity producers, Russia resolved the problem of food security. Currently, the country is ready to provide itself with essential food products.
4 Discussion Although research and assessment of the state of the Russian AIC have established positive dynamics in the development of the Russian agricultural sector, there are several factors that, in our opinion, are limiting the industry. These factors include: 1) 2) 3) 4) 5)
a significant level of depreciation of fixed assets; an apparent lack of highly efficient modern production technologies, specifically in farm enterprises; industry enterprises depend on imported equipment and technologies (leads to increased production costs); insufficient state funding and support for farm entrepreneurship; the shortage of highly qualified specialists in agriculture, since the introduction of innovative forms of production and technology, requires innovative development and training of suitable personnel.
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The changing conditions of globalization, the economic crisis, changes in the legislative and regulatory framework, and existing practical experience make it clear that there is a need to continue researching the considered issues to scientifically justify effective mechanisms for the formation of a highly efficient agricultural sector in Russia.
5 Conclusion Thus, we can conclude that globalization, as a form of manifestation of the international economy (on macro-level), had enhanced inter-country interaction and facilitates the entry of companies beyond the borders of its territory, i.e., providing access to foreign markets within the framework of activities of business entities (on macro-level). The creation and development of the globalization of the agricultural sector can be defined as a framework since the development is based on system-evolutionary changes. Furthermore, the globalization of agricultural sector is marked with a measured implementation of strategic development on a long-term basis. This longterm nature results in the formation of product integrity, which makes agriculture an integral part of the global world economy, i.e., an integral part of globalization. Nowadays, the Russian market has a positive trend of renovation within its agricultural production sector, which is confirmed by increasing volumes of production in crop and livestock product categories. The dynamics of the development of Russian agricultural sector have shown that the development and growth of exports of Russian agricultural products have a fairly significant potential at its disposal, which determines the integral role of agricultural trade in the Russian economy. In this regard, the export of the food sector is one of the significant and strategic tasks of the Russian market economy, since the existing agricultural potential of the territories allows Russia to transfer the country from the status of self-sufficient to the status of a leading global exporter, which will require the resolution of several strategic tasks, including [5]: 1) 2) 3)
the renovation and development of the technological level in various supporting industries to bring them to a higher level; the organization of an innovative infrastructure of export security; the renovation of the system and program mechanisms for financial support of the business sector (the direct manufacturer of agricultural products).
To increase and continue the development of Russian exports of agricultural products, it is necessary to tackle the following issues: 1. 2.
significant reduction of trade barriers (customs, currency, etc.); regulation and reconfiguration of trade and industrial policy, targeting of promising (in terms of potential development and export diversification) sectors of the economy;
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3.
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several other important issues.
Based on the significance of the problem, the following actions can be identified as the primary forms of strategic orientation for the development of the agricultural sector (within the framework of globalization): 1)
2)
3)
4) 5)
constant qualitative improvement of agricultural products, which will contribute to the growth of competitiveness, world market export volume, overall investment attractiveness of the agricultural sector (as noted by the President of the Russian Federation, V. Putin “in order to become a net food exporter, Russia should increase the export of high-value goods, which, in turn, will require the improvement and development of agro-logistics, the expansion of bottlenecks in railway transport, the growth of capacities of seaports, elevators, and product storage terminals”…); building the capacity of the agricultural sector through stimulation and modernization of the primary production for the subsequent growth of self-sufficiency in several basic product categories (meat, milk, etc.), as well as further work on breeding and genetics (a matter of food security and independence); the growth of targeted grant support for farms and the promotion of their importance in agricultural production (the share of the farm sector of agricultural production in the domestic market increased 4 times in 2017); further development and consolidation of agricultural holdings; ensuring the common economic and social space of the country through infrastructure development in rural territories to maintain and increase the quality of life of their inhabitants.
Moreover, taking into account the factor in the vector of globalization of the agricultural sector, it is quite possible to introduce the digital economy into the AIC, since the large-scale introduction of digital technologies (robotics, artificial intelligence, and the “Internet of Things”) shape the current stage of the globalization process and determine the progressive development of any state in the world.
References 1. Federal State Statistics Service (n.d) Official website. https://eng.gks.ru 2. Kolesnikov AV, Zdorovets YI, Shinkarenko OO, Fedyushin DY (2019) Prospects for the development of large-scale agricultural production on the example of the grain subcomplex of Belgorod Oblast. Econ Labor Manag Agric 1(46):70–78 3. Likhosherstova GN, Semchenko IV, Yasenok SN, Nezhedbchenko EV, Yakovenko NY (2019) Globalization of the world economy and its impact on the development of the transport system of the Russian Federation: regional aspect. Manag Econ Syst Electron Sci J 3(121):26 4. Nezhelchenko EV, Dobrunova AI, Yakovenko NY (2016) Evaluation of the efficiency of production and economic activities of agricultural organizations in the Belgorod Region. Reg Econ Manag Electron Sci J 4(48):169–180
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5. Ragulina JV, Bogoviz AV, Lobova SV, Alekseev AN, Pyatanova VI (2020) Strategy of increasing the global competitiveness of Russia’s economy and Russia’s becoming a new growth vector of the global economy. Lecture Notes in Networks and Systems, vol 73, pp 203–210 6. Rodionova OA, Golovina LA (2019) Specialization and price parity – invariants of adaptation of agricultural organizations to structural changes. Econ Agric Russia 1:20–26
Transformations in Agricultural Structures and Modifications in Agricultural Markets: Regional Aspects Olga G. Charykova , Vladimir F. Pechenevsky , and Tatyana N. Gogoleva Abstract The paper systematizes the main features of the agricultural structure. Additionally, it identifies the following subspecies of the agricultural structure: sectoral, territorial, organizational, and economic structures, the structure of commodity circulation, and resource and competitive potentials. These subspecies influence the development of production and the functioning of the food market. The paper reveals the content of the concept of “agricultural structure” and offers a methodological approach to its assessment through structural changes analysis. The particular and general indicators of structural changes (mass, index, and efficiency) are defined. Structural shift indices for 1990–2017 were calculated as a result of the analysis of the sectoral structure of agriculture in the Voronezh region. According to the results of calculations and assessments of the agricultural structure, several periods are highlighted. The first period from 1990 to 2000 is marked with the stagnation of production, market imbalance, and low efficiency of the agricultural structure. The second period from 2001 to 2010 is marked with a decline in production, a reduction in market capacity, and the inefficiency of the agricultural structure. The third period from 2011 to 2017 is marked with an improvement in agricultural production, an increase in the capacity and saturation of the regional markets of the Central Black Earth macroregion, and an improvement in the agricultural structure. To study the impact of agricultural structures on the functioning of the agricultural market, the authors assessed the meat segment. The assessment is given for the regions of the Central Black Earth macroregion (Belgorod, Voronezh, Kursk, Lipetsk, and Tambov regions) from 1990 to 2017. As a result of the assessment of the consumption of meat and meat products, a modification of local markets is shown. The best indicators were noted in the Belgorod region, which has the optimal agrarian structure among the regions. In 2017, the share of livestock in regional agricultural production was 69.3%. The study of the impact of sectoral and territorial structural changes indicates a close O. G. Charykova (B) · V. F. Pechenevsky Scientific Research Institute of Economics and Organization, Agroindustrial Complex of the Central Black Earth Region of the Russian Federation, Voronezh, Russia T. N. Gogoleva Voronezh State University, Voronezh, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_17
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correlation with the volume of food consumption and the effectiveness of agri-food markets. Keywords Agricultural structure · Study · Transformation · Structural shifts · Rating · Agricultural market · Region
1 Introduction The achievement of the priority goals set by the agro-industrial complex [AIC] to ensure the national interests of the country and strengthen its position in the world market is largely determined by the development of the agri-food market and the structure of agricultural production. Additionally, the achievement of the priority goals set for the AIC is determined by the presence of external demand and the effective use of the national competitive potential of the agricultural sector. At the same time, the region’s role and importance differ significantly in the competitive positions of the agri-food market and ensure the country’s food security. The transformation of the agricultural structure and the modification of local regional markets is a complex interconnected process. The presence of demand requires sources for its satisfaction, that is, the development of specific industries. Simultaneously, efficient production (a division of labor, rational distribution, and deepening of specialization) is the driver of increasing the efficiency of markets. In this regard, the relevance of this study is determined by several aspects. First, the research relevance is determined by the presence of objective prerequisites for the development of the agri-food market, including export-oriented markets. They are marked with high external demand and significant competitive agricultural potential. Second, the research relevance is determined by the lack of methodological tools adapted to industry specifics. Moreover, the research relevance is determined by the lack of results of a comprehensive assessment of the impact on changes in market mechanisms and the modification of agricultural markets caused by transforming the agricultural structure. In this regard, in our opinion, the definition of modern approaches to assessing the modification of market product segments under the transformation of the agricultural structure is a timely, practically important, and relevant research topic. This research topic is suitable for developing priority areas and developing a competitive, including export-oriented, agri-food market. The research purpose is to identify the dependence of the modifications in the agricultural market on the influence of the transformation of the agricultural structure. To achieve this goal, the following tasks are identified: 1.
To clarify the theoretical and methodological approaches to the transformation of the agricultural structure as an essential condition for the development of the agri-food market;
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2.
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To assess the structural changes and the development of regional agricultural product markets in the context of the transformation of the agricultural structure.
2 Materials and Methods Many foreign and domestic scientists studied the structural changes of complex socio-economic systems regulating the national economy in the country and regions (M. Blasharm, Sh. Kremer, Ya. Perez, A. I. Timberg, E. V. Abalkin, O. I. Balatsky, P. S. Botkin, L. A. Voronin, V. A. Dedov, L. S. Zhamin, D. N. Kazinets, V. V. Karpukhin, O. Yu. Kasov, N. D. Krasilnikov, B. N. Kondratiev, A. I. Kuzyk, Yu. V. Notkin, et al.). However, their studies mainly affected structural changes in the industry. In turn, the agrarian issues of reform and structural changes were actively studied in the 1990s. The results of the research of agricultural economists (G. V. Bespakhotnyy, I. N. Buzdalov, A. I. Dobrynin, V. Z. Mazloev, V. V. Miloserdov, V. A. Saraykin, E. V. Serova, and many others) laid the foundations for the transformation of a market economy and agricultural production. Studies of agricultural structures in Eastern Europe are of significant practical interest [2, 5, 9, 10]. At the same time, in these works, the agrarian structure was not thoroughly studied in terms of its influence on the development of the agrarian market and ensuring the food security of the country. It is advisable to adopt the proposed methods of analysis and assessment of structural changes and their impact on agricultural performance to specific markets and market situations. The scientific works of domestic and foreign experts acted as the theoretical and methodological basis of the study. They are dedicated to resolving economic issues of agricultural development, the problems of transformation of its structure, development, and regulation of the agricultural market. Russian regulatory legal acts on the functioning of the AIC served as the theoretical and methodological basis of the study. General scientific methods and theories of cognition of the development of socio-economic systems of the economy (analysis, abstraction, idealization, synthesis, retrospective, concretization, formalization, and others) were used in the study. The authors also used special economic methods (abstract-logical, balance, monographic, system-structural, economic-mathematical modeling, and economic-statistical methods) and previous theoretical and practical research. The data of the Federal State Statistics Service of the Russian Federation, the Ministry of Agriculture of the Russian Federation, officially available information of the Institute for Agricultural Market Studies served as the primary sources of information. The authors also used documents of the Government of the Russian Federation, and regional government bodies, accounting reports of agricultural and processing enterprises, materials of industry meetings, and conferences served as sources of information.
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Analytical data published in scientific literature and periodicals, expert estimates and developments of Russian and foreign scientists and economists, and analytical and calculated materials were used as the empirical basis of the study.
3 Results The presence of demand (internal and external) and sources of satisfaction (stocks, own production, and import) are the economic basis for the functioning of agri-food market. The ratio of supply and demand, the level of specialization and distribution of commodity resources, and the existing labor division form various types of markets (import-dependent, export-oriented, mixed). The research results showed that the significant differentiation of regional and local markets according to the level of commodity production and satisfaction of domestic demand, the degree of self-sufficiency of regions with basic foodstuffs, and developed infrastructure make it possible to distinguish the types of local markets. Self-supporting, exporting, importing, and combined local markets stand out [13]. The regions of the Central Black Earth macroregion [CBER] almost completely provide the population with basic foodstuffs and agricultural products. These exporting regions developed transport and logistics infrastructure. Therefore, their further development is supported by the following factors: deep processing of agricultural products, deepening and expanding market segments, the development of mutually beneficial interregional ties, access to new foreign markets, and the formation of export-oriented production and food markets. In Russia, the beginning of the 1990s is connected with fundamental transformations. Significant shifts in the structure of gross and marketable products of agricultural producers, their resource potential, and financial results affected the food supply and the effectiveness of the agricultural market. To analyze the mutual influence of agriculture transformation on market performance, we should assess the structural changes (industry and territorial) and the dynamics of the agri-food market in the corresponding periods. To study the transformation of agriculture, it is advisable to correlate quantitative indicators of production resources, as well as resources with production results. This method will allow us to assess the trends and effectiveness of structural changes, both of individual elements and the whole system. This method\s application will allow us to assess the impact of the system on the state, development, and modification of the agri-food market. The results of theoretical studies of the works of domestic and foreign scientists made it possible to systematize the main features and distinguish the subspecies of agricultural structures that affect the development of production and the functioning of the food market. Self-supporting, exporting, importing, and combined local markets stand out.
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Thus, the complexity of the agricultural structure is manifested through a combination of interconnected elements, the functioning of which is designed to ensure the balance and stability of agricultural production and the agricultural market. The main mechanisms of changes (shifts) in the agricultural structure are the transformation of social needs (aggregate demand). The generalization of different opinions of economists allowed us to present a structural shift in the agricultural sector as a process of changing the internal structure of agriculture under the influence of the needs and interests of business entities [3, 6, 8, 11] (Fig. 1). Changes in factors and conditions that influence structural changes lead, in turn, to changes in the existing agricultural structure. The study of their influence will allow them to be ranked according to the degree of importance and purposefully influence the transformation of the agricultural structure. This agricultural structure is focused on long-term economic growth and improving the level and quality of life. The study of theoretical provisions regarding the category of “structural shift” substantiated the need to establish indicators characterizing structural shifts (Fig. 2). The results of the selection of key indicators show that the following types of effectiveness are distinguished: 1.
The effectiveness of the agricultural structure is marked with an increase in gross output, an increase in labor productivity, an increase in capital productivity, and an increase in profit. Furthermore, the effectiveness of the agricultural structure
External conditions
“Old” agricultural structure
Internal factors
Change in social needs (demand)
Economic transformation
Imbalances, stagnation
“New” agricultural structure Balanced efficient market
Quantitative changes
Quality changes
Structural shift Fig. 1 The place of structural changes during the transformation of agricultural production and modification of agricultural markets. Source Developed by the authors
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Critical indicators for assessing structural changes in agriculture
Structural shift mass
The difference between the specific gravities of the structural elements in the reporting and base periods
Structural shift index
The ratio of the mass of the structural shift to the specific gravity of the structural elements in the base period
Structural shifts efficiency
The ratio of the mass of the structural shift to the cost of the structural shift
Fig. 2 The main indicators for assessing structural changes in agriculture. [1, 7] Source Compiled by the authors based on [12, 4];
2.
is marked with a decrease in the cost, a reduction of the material consumption of the products, and the conformity of the products to social needs; The effectiveness of structural changes determines the conformity of structural changes in the agricultural structure to the growth of gross output, revenue, and profit from sales. Moreover, the effectiveness of structural changes determines the conformity of structural changes in the agricultural structure to the profitability of production and the satisfaction of social needs (demand).
4 Discussion In the post-reform period, organizational and economic transformations in agricultural production affected property relations, legal forms of production, and its specialization. This was the basis for the formation and development of sectoral and grocery agri-food regional and local markets. Animal husbandry prevailed in the gross agricultural output of the Central Black Earth macroregion and its regions until the beginning of the 1990s. International experience shows that in highly developed industrial countries, no more than 35% of agricultural production falls on crop production. A significant part of the products produced in the industry is used in animal husbandry [13], which, compared to the crop industry, is less affected by natural and climatic conditions. In animal husbandry, production seasonality is less pronounced. At the same time, fixed and circulating means of production and labor are more measured throughout the year, and the proceeds from the sale of products are received more evenly. In this regard, an increase in the share of animal husbandry shows the efficiency of using the resource potential of the industry and indicates the tremendous economic sustainability of the agricultural organization.
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The calculated values of the structural shift index in the crop industry indicate a negative trend in production and disproportionality in the of development of this industry. The ratio of industries confirms this. Therefore, in 2017, the share of crop production was 72.9% of the 1990 level, whereas the share of livestock production decreased by 34.5% (Table 1). Among many reasons for the structural shift in agricultural production in the macroregion, first of all, the reasons for the institutional order should be highlighted. The reasons for the institutional order are the institutional parameters of ownership and management. They took shape during agrarian transformations, which could not ensure a stable and effective agrarian structure that could quickly solve the country’s food security problem and regions. The analysis of the effectiveness of structural changes in crop production and animal husbandry made it possible to distinguish three main periods: • 1990–2000 is a period of stagnation (low efficiency); • 2000–2010 is a period of recession (critical indicators, industry imbalance, inefficient structure); Table 1 Sectoral structure of agriculture in the Voronezh region for 1990–2017, % Industries Cereal
Years 1990
2000
2005
2010
2015
2016
2017
Structural shift index
11.5
23.4
23.4
28.8
13.5
26.6
27.1
Soybean
0.0
0.0
0.0
0.1
0.3
2.2
2.4
9.1*
Sugar beet
6.5
29.6
29.6
9.5
7.3
5.0
9.3
43.1
Oilseeds, total
2.2
4.4
4.4
11.9
12.3
12.9
9.0
309.1
including sunflower
2.2
4.4
4.4
11.9
12.3
12.7
8.8
300
11.8
12.3
12.3
11.7
6.9
7.6
7.5
−36.4
0.2
0.3
0.3
0.3
0.4
0.2
0.1
−50
Total crop
32.1
70.1
70.1
62.3
40.7
54.4
55.5
72.9
Cattle breeding
52.6
26.0
26.0
31.0
36.7
22.6
22.1
-58
Pig breeding
9.0
0.6
0.6
3.1
7.7
13.0
13.2
46.7
Sheep breeding
3.1
1.1
1.1
0.1
0.3
0.1
0.1
−96.8
Poultry farming
3.0
1.9
1.9
3.2
14.2
9.7
9.0
200
Feed Other products
Other Total animal husbandry Total
0.2
0.3
0.3
0.3
0.4
0.2
0.1
67.9
29.9
29.9
37.7
59.3
45.6
44.5
100.0
100.0
100.0
100.0
100.0
100.0
100.0
Source Calculated by the authors
135.6
−50 −34.5 x
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Fig. 3 The consumption of meat products in the regions of the CBER. Source Developed by the authors
• 2010–2017 is a period of recovery in agriculture, an increase in the share of animal husbandry, and improved sectoral structure (efficiency has grown). The commodity resources of the agri-food market and the completeness of meeting the needs of the country and regions in various types of agricultural products are primarily determined by the size, structure of sown areas, and productivity. Furthermore, they are determined by the number of animals and their productivity and, as a derivative of these parameters, gross crop production, and gross livestock production. Changes in the sectoral structure and highlighted sectoral and territorial shifts influenced the modification of local (regional) markets and the consumption of agricultural and food products. Thus, by 2000, the consumption of meat products decreased to minimum values, namely, 42 kg per capita per year (Lipetsk region) and 43 kg (Voronezh region). A similar situation developed in other areas of the CBER (Fig. 3). Thus, the analysis of the impact of sectoral and territorial structural shifts indicates a close correlation with the volume of food consumption and effective indicators of the agri-food market.
5 Conclusion The results of the study allowed us to consider the transformation of the agricultural structure from current positions. It is proposed to consider quantitative and qualitative changes through the analysis of structural shifts in a theoretical aspect. They allow us
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to conduct a comprehensive assessment of individual elements and the entire system and estimate its impact on the state, development, and modification of the agri-food market. In a theoretical study, a methodological approach to assessing structural changes is proposed. It includes the sequence and methodology for calculating the main quotient (mass, index) and generalizing (coefficient, efficiency) indicators tested on the example of a separate region, namely, the Voronezh region. A generalization of the results of structural changes in crop production and animal husbandry in the Central Black Earth macroregion allowed to identify the main periods of structural changes. In these periods, the functioning of the agri-food market through the consumption of meat products is shown. The results of the analysis of the transformation of the agricultural structure demonstrated a close relationship and influence on the modification of the agri-food market in the meat segment.
References 1. Dedov LA (1995) Structural and dynamic analysis in economics. Izhevsk State Technical University, Izhevsk 2. Fellmann T, Möllers J (2009) Structural change in rural Croatia – is early retirement an option? Int Adv Econ Res 15(1):125–137 3. Filimonova NG (2011) The concept of structural transformations in the region’s agriculture (Dissertation of Doctor of Economics). Moscow, Russia: Russian State Agrarian University 4. Government of the Russian Federation (2019) The decree “On the approval of the state program “Integrated development of rural territories” and on amendments to some acts of the Government of the Russian Federation” (May 31, 2019 No. 696). Moscow, Russia 5. Grancelli B (2011) Local development in the rural regions of Eastern Europe: Post-socialist paradoxes of economic and social Entrepreneurship. J East Eur Manag Stud 16(1):34–39 6. Ishchukova N, Smutka L (2014) The formation of Russian agrarian trade structure: Interindustry vs. Intra-industry trade activities. Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis 62(6):1293–1299 7. Karkhin GI, Chesnokov AS (1983) On the methodology for measuring structural shifts. Econ Math Methods 19(2):251–259 8. Kuznetsova EB, Pratchenko OV (2015) Formation and structuring of cooperating structures in agrarian production of the modern Russian economy. Mediterr J Soc Sci 6(3):751–755 9. Otiman PI (2012) Romania’s present agrarian structure: a great (and unsolved) social and economic problem of our country. Agric Econ Rural Dev 9(1):3–24 10. Pietrzak MB, Walczak D (2014) The analysis of the agrarian structure in Poland with the special consideration of the years 1921 and 2002. Bulgarian J Agr Sci 20(5):1018–1039 11. Sergi BS, Popkova EG, Bogoviz AV, Ragulina YV (2019). The Agro-industrial Complex: Tendencies, scenarios, and regulation. In Sergi (ed.) Modeling economic growth in contemporary Russia, pp 233–247. Emerald Publishing Limited, London. https://doi.org/10.1108/9781-78973-265-820191009 12. Voronin PS (2004) Structural changes in the Russian economy and prospects for economic growth (Dissertation of Candidate of Economic Sciences). Moscow, Russia 13. Zakshevsky VG, Charykova OG, Kvasov AYu (2017) Strategy for socio-economic development of the agro-industrial complex of the region . AIC Econ Manag 12:13–23
Development of Intellectual Agriculture in Modern Economic Conditions Oksana G. Karataeva , Maxim I. Pekalski , and Denis I. Pekalski
Abstract With an ever-growing population, food production, taking into account import substitution, is of particular importance. The decrease in the population from rural to urban areas and the production of agricultural products in sufficient quantities, and high quality are becoming acute agricultural problems. The development of intelligent agriculture and innovative intelligent technologies will make the agricultural industry attractive to investors and producers. The introduction of intelligent technologies in agriculture requires the reengineering of all sectors of the AIC related to the production, processing, storage, transportation, and delivery of products. The use of intelligent systems in agricultural production will minimize the use of external resources (fertilizers, chemicals, and fuels), and maximize the use of local factors (biofuels, organics, and own energy sources). Keywords Agricultural enterprises of AIC · Import substitution · Intelligent agriculture · Innovative technologies · Intelligent technologies · Agriculture
1 Introduction Economic reforms in the agricultural sector of the Russian economy established the following negative trends: • Agricultural production decline; • The material, technical, and financial situation of agricultural enterprises worsened; • The unfavorable socio-economic situation in rural areas aggravated. O. G. Karataeva (B) Russian State Agrarian University – Moscow Timiryazev Agricultural Academy, Moscow, Russia e-mail: [email protected] M. I. Pekalski All-Russian Research Institute of Potato named after A. G. Lorch, Moscow, Russia D. I. Pekalski Moscow State University named after M. V. Lomonosov, Moscow, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_18
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The task of any region is to create conditions for a decent life and activity by increasing the level and quality of life. The authors study the prospects for the development of intelligent agriculture in current economic conditions. The research object is agricultural enterprises of the AIC. The research subject is the trends, patterns, and factors in the formation and functioning of intellectual agriculture. It is possible to overcome this situation based on scientific and technological progress, restoration, and development of the real sector of the economy and the AIC, giving it an innovative character.
2 Materials and Methods The analysis of literary sources showed that the development of intelligent agriculture is the primary strategy for the innovative development of the AIC. Thus, there is a need for the transition of agriculture to a qualitatively new innovative type of development, taking into account external and internal factors (Table 1). Therefore, for the effective development of the AIC, it is necessary to introduce intelligent, innovative solutions, taking into account the external and internal factors of innovative development. These solutions help agricultural producers to Table 1 External and internal factors of the innovative development of agribusiness First factor
The intensification of global competition in the agri-food economy is taking place. The global competition covers markets for goods, services, capital, and other components of the economic development of the AIC. Competition in agri-food markets intensifies. These markets are undergoing significant changes due to the growth of agricultural consumption in the world
Second factor Low labor productivity in Russian agriculture and the irrational use of production factors determine the low efficiency of most business entities in the agricultural sector and even stagnation of production Third factor
There is an insufficient level of development of human capital in rural areas. This is due to the unresolved problems of the socio-economic development of the village, with the single-profile nature of rural development. Modern technologies have significantly increased the requirements for the qualification of labor in the agricultural business and reduced employment
Fourth factor
It is impossible to solve the problems of providing the population with affordable and high-quality domestic food in volumes and structures corresponding to rational, scientifically-based nutritional standards (the tasks set in the Doctrine of Food Security of Russia). These problems cannot be solved while maintaining the prevailing trends in the development of the AIC and the existing mechanisms for its state support
Source Developed by the authors
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meet modern market needs, effectively use available resources, and optimize critical areas in the AIC [1, 3].
3 Results Agricultural development is carried out following the objective economic laws of expanded reproduction. Reengineering of all industries related to the production, storage, transportation, and delivery of products to the consumer is required for the implementation of intelligent technologies. With the intensification of production, intelligent systems will help minimize the use of external resources (fertilizers, chemicals, and fuels). Additionally, intelligent systems will help to maximize the use of local factors (biofuels, organics, and own energy sources). For this, one needs [2]: • To introduce information technology, which requires a stable Internet and related equipment; • To obtain satellite communications, allowing tracking processes in the agricultural sector; • To implement sensors for transmitting information about objects. Information systems in the AIC imply the presence of software and hardware and personnel monitoring information of production processes aimed at improving the industry efficiency. Satellite systems can probe the surface of the earth daily, which allows creating a map of farmland and determine their use. Space imagery helps to see the centers of erosion, waterlogging, and other manifestations of land degradation. Space imaging allows one to assess the germination and ripening of crops and identify diseases at an early stage. The introduction of modern, high-quality, high-performance equipment, the improvement of machines and assemblies, and the fast and high-quality work on fuel economy are priority areas. Uncrewed vehicles and robotic systems significantly increase industry productivity. Internet of Things [IoT] is a network of Internet-related objects that can collect data and exchange data coming from built-in services. It includes any offline devices connected to the Internet that can be monitored and controlled remotely. IoT uses software systems that analyze data received from special devices. Depending on the program, large agricultural enterprises and small-scale farmers can use the IoT. It is necessary to form digital platforms that provide end-to-end digital economic processes, i.e., the entire business chain from producer to consumer, taking into account the linking of automated systems. The digital platform should unite
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the producer, consumers, logisticians, laboratories, processors, trade enterprises, scientific organizations, and authorized bodies in agriculture and control.
4 Discussion In our opinion, intelligent agriculture includes the following aspects: • The acceleration of scientific and technological progress. This direction is carried out by strengthening the material and technical base, industrialization of agriculture, and its transfer to an industrial basis; • Rational use of material, energy, and labor resources, which means the transition to resource-saving technologies; • Improving the production management system; • The transition to digital activity models and end-to-end digital processes; • Using digital platforms; • The use of highly qualified personnel [4].
5 Conclusion 1.
Intelligent agriculture includes the following aspects: • The acceleration of scientific and technological progress. This direction is carried out through the strengthening of the material and technical base, industrialization of agriculture, and its transfer to an industrial basis; • Rational use of material, energy, and labor resources, which means the transition to resource-saving technologies; • Improving the production management system; • The transition to digital activity models and end-to-end digital processes; • Using digital platforms; • The use of highly qualified personnel.
2.
3.
The development of intelligent agriculture and the need to transfer agriculture to a qualitatively new innovative type of development, taking into account external and internal factors, are the main strategies for the innovative development of the AIC. The effective development of agribusiness in Russia involves the use of information systems and technologies, the optimal selection of technological processes for cultivation, harvesting, and deep processing. Additionally, the effective development of agribusiness in Russia involves determining the parameters of the raw material zone, taking into account the use of satellite systems, satellite imagery, and uncrewed vehicles.
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5.
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The introduction of modern, high-quality, and high-performance equipment, the improvement of machines and assemblies, and the fast and high-quality performance of work on fuel economy are priority areas. The use of intelligent systems in hop production can increase the productivity and profitability of a wide variety of agricultural producers (from significant agricultural holdings producing a large number of hops to small farms).
References 1. Bogoviz AV, Semenova EI, Sandu IS (2019) Innovational tools of provision of food security through state support for the AIC in the conditions of the digital economy. Lecture Notes in Networks and Systems, vol 57, pp 334–340 2. Chutcheva YuV (2019) Technical and technological innovations in agricultural production. Agric Econ Russia 3:36–39 3. Karataeva OG., Kukushkina TS, Frolova YuS, Gribov IV (2019) Innovation in agribusiness. In Fedorenko VF (ed.) Proceedings of the XI International Scientific and Practical Internet Conference “Scientific and Informational Support for the Innovative Development of the AgroIndustrial Complex”, pp 224–231. Rosinformagrotech, Pravdinsky, Russia 4. Karataeva OG, Vinogradov OV, Kharlamov DI, Mitenev NS, Alekseev YuM (2019) Intelligent systems in agriculture. In Fedorenko VF (ed) Proceedings of the XI International Scientific and Practical Internet Conference “Scientific and Informational Support for the Innovative Development of the Agro-Industrial Complex”, pp 268–271. Rosinformagrotech, Russia, Pravdinsky
Green Investments as a Factor of Sustainable Economic Development Zinaida A. Mishina , Sergey N. Kozlov , Anatoly E. Shamin , Lyudmila M. Kornilova , and Marina S. Abrosimova
Abstract In this paper, the authors analyze the statistical data of Russia and foreign countries that show certain aspects of green investment. It is revealed that the market of green finance of Russia is at the initial stage of development. Business in the country is limited in opportunities for the introduction and use of green financing due to the lack of potential green investors. The issue of green bonds is designated and supported at the state level; several activities aimed at the development of the green finance market were planned during the discussions. The development of the green financing system is now seen as an integral part of the national development strategy and green investment as a factor in the sustainable development of the country. Based on this, it is concluded that the stable and continuous use of green investments by domestic organizations requires the involvement of all economic entities in the process of their financing. Keywords Green economy · Green investments · Investment · Agricultural organization · Efficiency
1 Introduction The modern economy came to a point where one of the priorities is the integration of economic and environmental laws. Many scientists see the further development of the country in integration. Many sources call such integration a green economy. In Russia, this concept has been actively used in the scientific community over Z. A. Mishina (B) · S. N. Kozlov · A. E. Shamin Department of Accounting, Analysis, and Audit, Nizhny Novgorod State Engineering-Economic University, Knyaginino, Russia e-mail: [email protected] S. N. Kozlov e-mail: [email protected] L. M. Kornilova · M. S. Abrosimova Chuvash State Agricultural Academy, Cheboksary, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_19
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the past two decades, but it is different in practice. Foreign countries are actively implementing practical developments to implement and further promote individual elements of the green economy. International societies were developed at the turn of 20–21 centuries. Additionally, some global initiatives were adopted [21, pp. 9–21]. These initiatives can have a significant impact on the global level, both on the policies of states and the development of companies until 2030 and beyond [11, pp. 22–23]. Sustainable development of the country’s economy depends on the influence of many different factors. Nevertheless, at the present stage of development, green investments should play a particularly important role. This is mainly since any kind of production is somehow connected with the environment: water, air, soil, etc. The use of renewable energy will provide economic benefits and reduce the negative impact on the environment.
2 Materials and Methods 2.1 The Researchers Many domestic [2, 3, 9, 15] et al., and foreign scholars [1, 8, 19, 18], et al. work on the indicated problem.
2.2 Information Research Base The author uses domestic and foreign economic periodicals, materials of news agencies, documents and materials of Russian ministries and departments, and materials of foreign departments.
2.3 Methods The study uses different approaches and methods, including abstract-logical, monographic, and comparison methods.
2.4 Aim The work aims to identify and analyze economic trends in the development of green investments as a factor of sustainable development of the Russian economy. The following tasks are defined to achieve this goal:
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– To analyze the resource base for the development of green investments; – To analyze the types of green investments and their potential; – To conduct an economic analysis of the problems and risks of the development of green investments; – To evaluate the effectiveness of the implementation of green investments.
3 Results and Discussion 3.1 Integrated Economic Development Over the past fifty years, interest in the integrated development of the economy, society, and the environment only increased. Such integration is considered the key to sustainable development. This kind of integration became global recently as the growth of physical and human capital leads to a significant depletion of natural resources resulting in acute inequality between people [7, pp. 12–15]. In 2012, the global conference “The Future we want” was held. Its participants were very concerned about the current situation in the world. The idea of a green economy first saw the light within the framework of this conference. During the discussions, it was noted that the green economy is not a luxury that only successful countries can afford, and that the trade-off between environmental sustainability and economic progress is not inevitable. At the same time, serious thought had to be given to the scale of the looming threat, measures aimed at solving the existing problems were identified and partially agreed upon. As a result, these measures should reduce the negative impact on the environment, contribute to the well-being of people, and lead to social equality. In this case, the individual approach of each state to the implementation of the planned activities within the country is important, including the interest of each citizen [10, p. 42].
3.2 The Concept of Green Economy Fifty years of world experience in studying problems related to the negative impact on the environment can serve as a starting point for Russia in the study of this issue. The experience of financing the transition to a green economy, the choice of the most optimal foreign model, and its adaptation are especially important. At the moment, there is no precise definition of a green economy. However, there are many definitions for this phrase, both capacious and abbreviated. In the first case, it is an economic activity aimed at social justice, the growth of human well-being with minimal risks to the environment. In the second case, it is the development, production, and operation of technology and equipment to reduce and control the emissions of pollutants and greenhouse gases, monitoring and forecasting of climate
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change, installation and technology of energy and resource-saving, and renewable energy [21, p. 12]. The idea of developing a green economy reaches a level where further development is simply impossible at the expense of its resources. There is a need to find alternative sources. The lack of a clear definition of the green economy makes it difficult to understand the definition of green investment. Its frequent use only shows that all promising federal and regional projects, which are full of such a concept as a green investment, pursue social or economic enrichment without significant proposals for the effective use of natural resources. Consequently, such projects do not reflect the original meaning, as they involve the use of alternative sources rather than the replenishment of available natural resources. There are projects aimed at using alternative energy sources, such as solar or wind energy. They will be important at the present stage of development of the green economy because they do not require the use of any other energy sources for their activities, and the costs of creating windmills and solar panels pay off quickly enough.
3.3 The Interest of Agricultural Producers in Innovative Technologies Another important point in the development of the green economy in Russia is the readiness of the organization and companies to use modern innovative technologies. The maximum role in the development of the green economy should be given to the primary sectors of the economy, in particular agriculture, as it is the branches of agriculture that supply raw food materials. Focusing on this, we can say that the green economy is a new format of economic development of the entire world community, determined by the rational use of limited resources under unlimited growth of needs, through the use of modern resource-saving technologies and trends in organic agriculture [17, p. 61]. The answers of agricultural organizations to the question “Is the company ready to use innovative technologies in its activities?” show that 50% of organizations, to some extent, already use them [12, p. 73]. Therefore, even the industry that is most dependent on natural conditions is ready to use and implement new innovative technologies. This indicates the need to reach a new level of economic development and, as a result, to consider the environmental aspects of the management of any industry as one of the priorities for its sustainable development. The development of a green economy on a global scale involves a step-by-step, multi-level approach.
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3.4 European Experience Unlike Russia, the European Union has long been engaged in introducing innovative technologies in all sectors of the economy, but renewable energy sources are a prior and investment-attractive sphere. In 2009, the renewable Energy Directive outlined three goals for the EU in the run-up to 2020. The first goal is the reduction of greenhouse gas emissions by 20% below 1990 levels. Secondly, the increase in the share of renewable energy sources is 20% of the final consumption. Thirdly, the total primary energy consumption of the EU is reduced by 20% compared to the 2007 energy consumption projections for 2020. In 2011, the “Energy strategy until 2050” was developed, according to which the EU objectives were adjusted so that by 2050 the level of greenhouse gas emissions should be reduced by 80–95% compared to 1990. This goal should be achieved by attracting large-scale investments for the development of low-carbon technologies, renewable energy, energy efficiency, and, as a result, grid infrastructure. The share of renewable energy should rise to around 70% [16]. However, there again arises the question of investment. Talking about the formation of the market of green finance in foreign countries, we can trace the following stages of its formation: 1. 2.
3. 4. 5.
6. 7.
2007–2008—the first issuance of green bonds by international development banks; 2007–2010—major issuers of green bonds: the international bank for reconstruction and development, European investment bank, several other national and regional development banks and funds; 2010—the foundation of the International non-profit organization Climate Bonds Initiative (CBI); 2011—the publication of the first voluntary climate bond standard and its certification scheme; 2012–2015—the development and approval of four more industry standards (for solar energy, low-carbon public transport, and energy-efficient buildings) and industry standards for wind, tidal, and geothermal projects; 2014—the international Association of Capital Markets joined the work in the field of green bonds; 2017—a new version of the standards was published, reflecting all the previous standards and new ones, taking into account the use of new debt instruments [4].
The international market of green bonds is constantly developing because the issue of green bonds in the world is constantly increasing (Fig. 1). In 2017, the issue of green bonds grew to $155.5 billion (by 78%). According to Greenmarket Initiative forecasts, the Global green bond issue should reach $1 trillion by 2020. The US, China, and France accounted for 56% of the total green bond issue. The rating is headed by the US Mortgage Agency “Fannie Mae,” as the largest borrower of green bonds, with a total issue of $24.9 billion.
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Fig. 1 The issue of green bonds in the world ($ bln.) Source: [6]
3.5 Investment Funds by Industry The distribution of investments by the industry is not uniform and may vary annually depending on the conditions dictated by both the investment market itself and other internal and external factors (Fig. 2). According to Climate Bonds, there is an annual increase in investment in almost all industries, and renewable energy and low-carbon production remain priorities.
Renewable energy Low-carbon production Clean transport
Water management Rubbish management Soil use Other
Fig. 2 The distribution of investments by industry ($ bln.) Source: [6]
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3.6 Green Investment in Russia In Russia, the term green investment came into use relatively recently. The discussion of issues related to the green economy in Russia is not an entirely new direction. However, significant results were not presented, except for the results of the discussion attended by the World Wildlife Fund (WWF), economists, and business people. As part of this discussion, issues of long-term financial investments were discussed, which resulted in the creation of the document “Diagnostic note ‘Green Finance’: the agenda for Russia” [10]. Additionally, a Russian-language list of terms was created. The emergence of green bonds became possible without special regulation, and the participants expressed their willingness to make a pilot project. These results can be the starting point for attracting long-term financial investments for the implementation of green projects in Russia. Another significant step to attracting long-term investments was the establishment by the Central Bank of the Russian Federation of the Expert Council on the long-term investment market, the main tasks and functions of which are the collection, analysis, and summarizing of the opinions of participants of the Russian financial market on the most pressing problems of the market of long-term investments, assessment of existing legal acts of Russia governing the market of long-term investments and preparation of background information and analytical materials in the field of longterm investment market. The analysis and evaluation of attracting green investments in projects created and implemented in Russia are also of high importance [17].
3.7 Green Financing On February 15, 2019, the session “Green financing: developing the market of responsible investment” was held. As part of the session, the Deputy Ministry of industry and trade of the Russian Federation announced that Russia launches the mechanism of subsidizing green bonds in 2019. It will provide compensation for 0.7% of the base rate on coupon income. For this purpose, they allocated about 9.3 billion rubles for three years. This is one of the first real steps on the part of the state to develop the market of responsible investments in Russia. The formation of a full-fledged green finance market is possible only in close cooperation between all regulators and business representatives. The discussion concluded that the formation of the market of green bonds in Russia requires state support (Online magazine “investinfra.ru,” 2019).
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3.8 Green Bonds The first issue of green bonds in Russia took place on December 19, 2018. The company “Resource XMAO” posted first green bond of Russia on the Moscow exchange with a total nominal value of RUB 1.1 bn with the yield at the placement of 9.76%. The bond coupon is tied to inflation and the key rate of the Bank of Russia. In the first half of 2019, the Moscow stock exchange plans to create a separate sustainable development sector in which green and social bonds will be traded (Moscow [13]. Nowadays, the development of the green financing system is considered as an integral part of the national development strategy. For the formation and development of the market of green investment in Russia, a set of measures were proposed and developed, which are detailed in the “Road map” [4]. According to this document, the complex includes seven activities (Fig. 3). Events The development of ideology and consolidated position of regulators concerning the green finance market at the national level.
Potential participants Bank of Russia, Ministry of economic development, Ministry of industry and trade, Ministry of energy, Ministry of construction
A set of measures to create a single national brand in the field of green finance (methodological center)
Bank of Russia, relevant ministries, VEB, SRO, NAKDI, World Wildlife Fund (WWF Russia)
A set of measures to create and approve principles, standards, and taxonomy
Methodological center
3.
4.
A set of measures to form a system of certification of green financial instruments
5.
The complex of measures for the creation and development of infrastructure of the market of green finance
1.
2.
6.
7.
Lobbying for the preparation and implementation of a system of state support measures for green financial instruments (bonds) in Russia
A set of measures to international cooperation
Methodological center, public organizations, NGOs of green and financial markets: RSPP, NAKDI, SRO, auditors, rating agencies, consultants, working groups on ecology, and World Wildlife Fund (WWF Russia) Moscow Exchange, Methodological center, public organizations, green and financial markets NGOs: RSPP, NAKDI, SRO, auditors, rating agencies, consultants, working groups on ecology, World Wildlife Fund (WWF Russia) Bank of Russia, operators of existing information disclosure systems: Moscow Exchange The Bank of Russia, Ministry of economic development of Russia, Ministry of industry and trade, the Ministry of energy, Ministry of construction of Russia, Ministry of Russia, the Methodological center, development institutions Methodological center, development institutes, World Wildlife Fund (WWF Russia)
Fig. 3 Road map of forming a green finance market in Russia. Source: Compiled by the authors based on the Diagnostic note “Green Finance: the agenda for Russia” [4]
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3.9 Green Bond Issuers Together with the set of measures aimed at the development of the green investment market, a list of potential issuers for the issue of green bonds has been identified. The expert sample was conducted by the National Association of Concessionaires and Long-term Investors [NACLI], taking into account the activity of potential issuers of green bonds, which recorded the green identification of the company: 1. 2. 3. 4. 5. 6. 7. 8. 9.
The index “Responsibility and transparency”; The index “Vector of sustainable development”; National Register of corporate non-financial reports; Stock index ERAX; Social Charter of Russian business; UN global compact network in Russia; Rating of “Social efficiency of the largest Russian companies”; ESG rating of the Russian corporate sector; Recommendations for sustainable development of green investments of the National Association of Concessionaires and Long-term Investors;
As a result, the rating of green investment issuers includes 50 companies. The top ten included: “MMC ‘Norilsk Nickel’” PJSC (metallurgy), “RZHD” JSC (transport), “Gazprom” JSC (petrochemical industry), “RusHydro” JSC (energy), “SIBUR holding” PJSC (petrochemical industry), “Uralkali” JSC (chemical industry), “Transneft” JSC (petrochemical industry), “MCC ‘EuroChem’” JSC (chemical industry), “RUSAL Bratsk aluminum plant” JSC (Group of companies “RUSAL”) (metallurgy), and “ROSNEFT” PAO (petrochemical industry). The first steps in the implementation and development of the green finance market are beginning to grow into more confident measures. For example, in March 2019, the first green bonds issued by the company “KhMAO Resource Saving” are included in the international register of green bonds. The investment Fund “Alfred Berg Russland,” managed by the Swedish company “Alfred Berg,” became the first Russian equity fund. Other results that will allow Russian green investments to take a strong position in green finance are not excluded.
4 Conclusion Recently, trends indicate that Russia is lagging far behind foreign countries regarding the development of the green economy. The priority of the development of this type of economy long left no doubt since the use of renewable energy sources and the rational use of available resources can bring additional income, and, most importantly, will reduce the negative impact on the environment. The introduction of technological and scientific developments for renewable wind and solar energy entails large infusions of funds but contributes to a relatively rapid payback. In the future, it will ensure
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almost cost-free use of such types of energy. High costs for the introduction of environmentally friendly facilities are the reason for their slow spread. The particular importance of this situation should be given to investments aimed at the development of environmental projects (green investments). In world practice, green investments are widespread, while Russia is at the initial stage of the development of investment attractiveness. Of environmental projects. The first issue of green bonds and their inclusion in the international register of green bonds, the development of a roadmap for the formation of the green finance market in Russia, and the selection of potential issuers of green bonds can be considered as the first steps in this direction. The main achievement is that the development of green financing is now seen as an integral part of the national development strategy. As a result, green investments are one of the main factors aimed at sustainable economic development.
References 1. Aitken DW (2010) Transitioning to a renewable energy future, international solar energy society. https://library.uniteddiversity.coop/Energy/Transitioning_to_a_Renewable_Energy_ Future.pdf 2. Balzannikov MI, Elistratov VV (2008) Renewable energy source. Aspects of complex use. Samara State Agrarian University, Samara 3. Bezrukikh PP, et al (2007) Reference resources on renewable energy sources of Russia and local types of fuel (figures for the territories). In Bezrukikh PP (ed). IATs Energy, Moscow 4. Central Bank of Russia (2018) Diagnostic note “Green Finance: The agenda for Russia. https:// cbr.ru/Content/Document/File/51270/diagnostic_note.pdf 5. Central Bank of Russia (n.d.) Financial market development. https://old.cbr.ru/eng/finmarket/ development/ 6. Climate Bonds (n.d.) Official website. https://www.climatebonds.net 7. Fyuks P (2016) Green revolution: Economic growth without harm to the environment (Trans. From German). Alpina Non-fiction, Moscow. https://kniga.biz.ua/pdf/5622-zelenaya-revolu ciya.pdf 8. Gubbins N (2008) Community ownership models for renewable energy projects. In Conference Presentation Practical Solutions to Scotland’s Renewable Energy Challenges, Edinburgh, UK 9. Kanygin PS (2010) The economy of the development of alternative energy sources: On the example of the EU (Dissertation of Doctor of Economics). Moscow, Russia 10. Kudinov GE, Rozenberg GS, Yurina VS (2012) Towards a green economy: the path to sustainable development and poverty eradication. Princip Ecol 1(4):41–48. https://doi.org/10.15393/ j1.art.2012.1602 11. Lagard K (2015) True conversation. Way to development. Finance Dev 52:22–23 https://www. imf.org/external/russian/pubs/ft/fandd/2015/06/pdf/straight.pdf 12. Mitina IV, Frolova OA (2015) State support for the introduction of innovations to agricultural producers at the present stage. Bull NGIEI 11(54):68–75 13. Moscow Exchange (2018) The first green bonds in Russia were placed on the Moscow Exchange. https://www.moex.com/n22067/?nt=106 14. Online magazine “investinfra.ru.” (2019). The Ministry of Industry and Trade of Russia in 2019 will introduce a mechanism for subsidizing bonds to implement green projects. https://investinfra.ru/novosti/minpromtorg-rossii-v-2019-godu-vnedrit-meh anizm-subsidirovaniya-obligaciy-pod-realizaciyu-zelenyh-proektov.html 15. Osadchij GB (2010) Solar energy, its derivatives, and technologies of their use (Introduction to renewable energy). IPK Maksheeva E. A, Omsk
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16. Renewnews.ru. (n.d.) Renewable energy in the European Union https://renewnews.ru/eu/. 17. Rozhkova DV (2019) Organic production as a priority direction of the development of the green economy. Bull NGIEI 2(93):59–68 18. Shere J (2013) Renewable: The world-changing power of alternative energy. St. Martin’s Press, New York 19. Sorensen B (2010) Renewable energy, fourth edition: physics, engineering, environmental impacts, economics & planning, 4th edn. Academic Press, Cambridge 20. WWF (2018) Russian economy ready to attract investments in the green sector. https://wwf. ru/resources/news/zelenaya-ekonomika/rossiyskaya-ekonomika-gotova-privlekat-investitsiiv-zelenyy-sektor/ 21. Yakovlev IA, Kabir LS, Nikulina SI, Rakov ID (2017) Financing green economic growth: concepts, problems, approaches. Sci Res Financ Inst 3:9–21
Digital Transformations in the Agro-industrial Complex Veronika V. Yankovskaya
Abstract The paper focuses on defining key algorithms and components of the digital strategy, the central aspect of its formation, and the purpose of the digital strategy. The author identified the role and potential of the digital strategy for the agroindustrial complex [AIC], taking into account the demand for the Internet industry, the opinion of an actively developing business, and government requirements. The research purpose is to develop methodological assistance for the formation of a digital strategy, scientific substantiation, and evaluation of effective digital strategy tools that contribute to the development of the agricultural market in the digitalization era. Private scientific and general theoretical research methods were used during the study. We are currently witnessing active investments in the agricultural market and increasing competition for agricultural producers. This indicates a mature stage in the sector’s life cycle. There is an increase in the demand and quality of using modern IT technologies in this area. This creates an increasing demand for specific industrial and analytical systems. The formation and development of the website is a fundamental part of the digital strategy. Sequentially combining the digital strategy with multiple interdependent components, we get a flexible and easily adaptable tool that combines the formation/development strategy and sales. It was determined that an effective digital strategy is a kit consisting of leading basic components. The study showed that, nowadays, there is no full correspondence between innovative (IT-technologies) and strategic activities for the development of agricultural enterprises. This inhibits the implementation of technological advances. Consequently, it affects the volume and capacity of the market of agricultural enterprises and the growing needs of consumers. The forms, models, tools, and mechanisms for creating and further implementing a digital strategy for agricultural enterprises were not sufficiently developed. Actively developing digital technologies/strategies are forced to adapt to the existing organizational and economic base, which does not sufficiently stimulate the development of IT technologies. The predicted possibility of developing and implementing the digital transformation of the AIC in the digital V. V. Yankovskaya (B) State University of Management, Moscow, Russia Higher School of Tariff Regulation, Plekhanov Russian University of Economics, Moscow, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_20
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economic system is identified, and an algorithm for the formation of a digital strategy is proposed. Keywords Agriculture · Digital strategy · Digitalization · Presidential decree · Digital tools
1 Introduction After V. V. Putin, the President of Russia, adopted the decree “On national goals and strategic objectives of the development of the Russian Federation for the period until 2024” (May 07, 2018 No. 204), digitalization became a crucial trend in strategic development [13]. IT and digital technologies have a strong potential in the development of the Russian AIC. The architecture of the digital strategy is the connecting link that reflects the current and future needs of the AIC while providing it with a ready-made algorithm and a kit consisting of essential key components allowing the most optimal determination of the next tactical steps in the implementation of digital technologies in the agricultural market [2]. An industry/enterprise strategy is not just a simple and ambitious goal. It should reflect the situation in the country, the economy, current trends, and the vision of the future. There is no future without a strategy.
2 Materials and Methods The use of private scientific and general theoretical methods in the formation of digital strategies allows us to provide an innovative development stage for the AIC.
3 Results The expression “digital business strategy” is used increasingly often. Is it a useful tool or an ephemeral category? What are its principal elements? Only an expert with significant practical experience in the industry that is aware of the latest trends can identify the need for digital strategies. It will not be difficult for them to make calculations to evaluate the strategy developed by the specialists of the company for promoting and developing a business on the Internet. Nowadays, there is a unique and profitable opportunity to promote a natural agricultural product through the Internet. When forming a digital strategy, considerable attention is paid to its filling. An effective strategy consists of several components that reflect the specifics of the market that interests us. We take into account the macro and local levels to identify real competitors in this industry. Primary diagnostics of the website, the identification
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of the ratio and balance between the invested funds and the results, and the analysis of the flow of leads will assess the situation. The mistake will lead to the inadequate use of the available Internet space; the potential for online development will not be fully utilized. However, the level of competition is growing, and leadership positions will be taken by those who can use all the available potential of the Internet space. The digital strategy allows a company to achieve leadership positions. Let us present digital instruments and justify the need for their use in a market economy, identifying the strengths and weaknesses of each (Table 1). When forming a strategy, it is necessary to calculate its effectiveness and efficiency. It makes no sense to engage in an expensive tool; without preliminary assessment, it is necessary to perform a predictive ROI (Table 2). Let us look at how this happens in a company successfully operating for decades since the industrial era, meeting the post-industrial era and digital technologies. Interconnected business processes are occurring all over the world. Informatization is gaining momentum, which leads to the dynamic development of IT technologies and the Internet as a whole. Strategies as a driving tool allow companies to increase their capital significantly. The market does not stand still. High dynamics gives a quick change in technological cycles. The concept of strategy came to us from Ancient Greece “στρατηγ´ια”—“the art of a commander.” This art is aimed, as a rule, at the effective achievement of the goal. Thus, considering the existing developments, assumptions, reasoning, and conclusions proposed by domestic and foreign authors, we can define digital strategy. A digital strategy is the definition of the future development of a company on the Internet, taking into account consumer opportunities, the dynamics of market development, and the total potential of the company itself. It is a type of long-term plan for the company, aimed at competing with the use of advanced information technologies. The long-term goals of the company should be formulated using SMART technology. Let us consider one of the most promising strategies of the company “Russian Railways.” It is based on the ideology of an innovative “breakthrough.” What is the readiness of the company and its staff for changes dictated by active digitalization, and what is the place of strategy in the company? An outstanding philosopher in science and technology, a specialist in the informatization of society, A. I. Rakitov was the first to notice the interdependence between information and technological revolution. He proved that it is the information revolution that forms the basis for the dynamic development and transition of a society at a qualitatively different level [17]. The end of the 20th and the beginning of the 21st century is the time of transition from the industrial to the post-industrial era. It is the time of changing the philosophy of business entities. There was a transition from the philosophy of profit growth (profit at the forefront) to the philosophy of production for consumption and for the consumer. The post-industry did not have time to get active development, as it was covered by a wave of highly dynamic informatization of society. The basis of an information society is scientific knowledge and information resources. The rules of doing business saw a complete change; increasingly, progressive models and business management methods are used in the competition to increase the productivity of material and human resources. German Gref, at one of the international conferences, noted that by
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Table 1 Digital instruments, their strengths, and their weaknesses Instruments
Strengths
Corporate website “Virtual office”
– all the money spent on the – external promotion is creation and development of required; – additional attention is the website is a worthy required to the refinement, investment in the asset of the security, and content of the company; – key communication center of website the company: fairs, online sales, educational/familiarization webinars, specific information, productive interaction, etc.; – either partial or complete removal of the load from the call center, the site can be filled with 24/7 information
Weaknesses
SEO
– a relatively high trust of the customers, since they perceive the site as a non-advertising channel; – high traffic; – convenient distribution of cash for the current year, small initial capital; – high conversion of visitors to potential/real consumers/customers
– the result is difficult to calculate/predict; – quite often there is a forced change of individual components of the site for SEO; – quite a long time to achieve the desired stable results; – high dependence on webmasters and search engines
Contextual advertising
– almost all types and forms of targeting; – accelerated launch; – high controllability
– professional intervention is necessary to create an effective clickable ad; – if the indicators are not effective enough, the search engine can forcibly reject advertisements; – a significant budget is needed, mainly in competitive niches
Media advertising
– mass audience reach; – emotions and motives in the message; – well-remembered; – high integration with retargeting
– significant budget; – the inability to use the classic version for sales; – negatively/annoyingly perceived by visitors/users (continued)
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Table 1 (continued) Instruments
Strengths
Weaknesses
Social networks
– point impact in an informal setting for a specific/target audience; – transparent analytics of advertising policy; – constantly and significantly growing audience of potential consumers
The result of the advertising campaign is unpredictable since potential customers/users surf the Internet in search of entertainment or information on topics of interest. They surf the Internet less often for a specific purchase
Video advertising
– wide audience reach; – insignificant choice in – well suited for viral targeting; – to create a high-quality video, campaigns; – the video allows the audience significant funds are needed; – significant advertising to see and hear the promotion requires high costs advertising message; – there are several formats for testing: InStream, InDisplay, video SEO
Email Marketing
– increasing the loyalty of – blocking is possible, maybe potential and current partners mistaken for spam emails; can be achieved through the obsession must be avoided so use of email strategies; as not to provoke irritation; – as a rule, the creation will be – one must take into account quite cheap, taking into that customers may account the cost of content unsubscribe from the and delivery; newsletter – customer base can easily be increased at its expense; – a creative approach to the design of letters and database segmentation
Source Compiled by the author
2020, 75% of companies would become digital. The digital economy is developing on an equal footing with the traditional one [21]. Business processes in a market economy are subject to profound transformation, which leads to the transformation of HR strategy. Moreover, one of its essential areas is digital strategy. Companies are gaining momentum much faster if they implement digitalization in their activities. This is happening most actively in such areas as banking, media, etc. [12]. However, digitalization is taking place not only in dynamically developing areas of activity but also in traditional ones (education and production and processing of oil and gas). The forecast expects digitalization to be used in the most challenging areas of activity [16].
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Table 2 The effectiveness of digital instruments Instruments
Key Performance Indicators, KPI
Related comments
Corporate website “Virtual office”
As a rule, these are refusals
The disinterest of visitors or clients in the content of the website can be judged either by leaving the site after viewing one page or by the time spent on it, as a rule, less than 15 s
The duration of stay on the website
The amount of time spent on viewing the site by customers/users
Interest in the resource through The number of pages viewed by the depth of view customers/users of the site SEO
Contextual advertising
Media advertising
The determination of current and forecasted site positions
Different key positions of queries in various internet search engines
Opportunities for growing site positions using traffic from branded queries
Commercial requests or the number of customers/visitors (current and potential) from a search that does not contain the name of the brand and/or the company itself
The opportunities for the growth of site positions, the use of traffic from non-brand requests
Commercial requests or the number of customers/visitors (current and potential) from a search that contains the name of the brand and/or the company itself
Quantity and quality of demonstration
The number of times the ad was seen
CPC
Cost per click on the ad
CTR
Click-through rate (%)
CPL
Cost per lead
CPO
Not every lead goes into the sale. Determining the value of attracting sales
Positive sides (coincide with pluses in contextual advertising): CPM
Social networks
Advertising cost per thousand views
Positive sides (coincide with pluses in media advertising): By the duration of the temporary video viewing
The duration of the period in minutes from the watched video as a whole (continued)
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Table 2 (continued) Instruments
Key Performance Indicators, KPI
Related comments
Video advertising
Participants (their total number)
Subscriptions of community members (their total number)
Audience reach
The total number of customers/users who see company information/publications
The number of comments (positive/negative), likes, and reposts
Quantitative/qualitative indicators reflecting the activity of society/community
What is the % view of incoming emails?
–
Email Marketing
The number of rejections from – the proposed subscription Transitions to the site
The total number of clients/users who read the letter and clicked on the link to the site
The amount of time spent viewing (taking into account the landing page)
The quality of traffic (its indicator)
Emailing, contextual advertising, and the site use the same indicators Source Compiled by the author
4 Conclusion The introduction of digital technology in all areas of business is becoming not just a necessity, but rather a requirement of the competition. This shows the need to create a new HR-culture with new indicators of behavior, knowledge, and skills. Digital trends allow for increasing profits. Digital trends increase the quality and standard of living in society and the state of the economy of the country as a whole [1]. To ensure the effectiveness of the digital strategy, when developing an HR strategy, it is necessary to take into account the direction of the global strategic goals of the company spelled out until 2030. Initial business priorities are taken into account. Digitalization does not mean universal automation of the process. This is just a starting point. It is still quite early to talk about the complete digitalization of each enterprise/market. A truly positive effect should be expected only when, with the help of digitalization, it will be possible to achieve a balance between hard-to-do routine activities that require a lot of time and effort (monthly reports, administrative forms, registration of orders, and other similar types of activities and tasks), but at the same time have low efficiency and those types of activities that a person considers creative and engages in with pleasure.
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Digital technologies can make these types of activities simple and effective enough. People will consider their activity to be one of the significant tasks for the company. Their duties and professional skills will be used as intended and bring moral satisfaction to the person. The involvement of the employee in wider areas of activity, access to additional resources, and interaction with experts of various profiles motivate and stimulate the employee to productive work. Their sense of selfworth is growing, allowing them to demonstrate their best skills and qualities. In such conditions, employees will be aimed at personal career growth. Therefore, the motivation for professional development and achievement of their life goals will grow. Digital transformation involves the use of technologies that combine the virtual and physical worlds, which fundamentally change the way enterprises enter the market, interact with customers and employees, and manage internal processes. A digital strategy is the most valuable and powerful asset in a digital transformation environment and/or any future transformation. E-management allows us to take a different look and evaluate the promising direction, goals, and objectives, which are the main components of the general strategy of any corporation [22]. The digitalization of strategic management/global strategy by staff should ensure full interaction. The interdependence of a single direction in the development of the organization and the staff itself is not excluded [15]. HR is responsible for both digital and business strategies. The real driver of innovation and creative problem solving is communication between people. Technologies increasing the value of human interaction will always be an effective tool demanded by corporations. It will also contribute to the constant involvement of employees in this communication, turning the enterprise into an irresistible force. The market dictates a single rule if the business and HR strategies are based on digital technologies and the effectiveness of the formation and implementation of management decisions, namely, individualization (each employee of the company has all the conditions necessary for their self-realization/development of the potential, involvement in fields of activity related with their main one): – The ability to implement oneself as a virtual employee; – Automated recruiting; – HR-analytics [7].
References 1. Biankina AO (2017) Digital technologies and their role in the modern economy. Econ Soc Modern Dev Models 16:15–25 2. Bogoviz AV, Osipov VS, Chistyakova MK, Borisov MY (2019) Comparative analysis of formation of industry 4.0 in developed and developing countries. In: Studies in Systems, Decision and Control, vol. 169. Springer, Cham, 155–164. https://doi.org/10.1007/978-3-319-943107_15 3. Chica M, Chiong R, Adam MTP, Damas S, Teubner T (2017) An evolutionary trust game for the sharing economy. In Proceeding from CEC 2017: Congress on Evolutionary Computation, San Sebastian, Spain, pp 2510–2517
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4. Chinn MD, Frieden JA (2011) Lost Decades. The making of America’s debt crisis and the long recovery. W. W. Norton & Company, New York 5. Gell-Mann M (1988) Simplicity and complexity in the description of nature. Eng Sci LI(3):3–9 6. Hawlitschek F, Teubner T, Adam MTP, Borchers NS, Möhlmann M, Weinhardt C (2016) Trust in the sharing economy: an experimental framework. In Proceedings from ICIS: International Conference on Information Systems, Dublin, Ireland, pp. 1–14 7. Huggins R, Thompson P (2014) A network-based view of regional growth. J Econ Geogr 14(3):511–545 8. Johnson J (2010) The future of the social sciences and humanities in the science of complex systems. Eur J Soc Sci Res 23(2):115–134 9. Lobova SV, Alekseev AN, Bogoviz AV, Ragulina JV (2019) Wireless future of the agrarian market as a basis of food security provision. Stud Comput Intell 826:975–981 10. Mainzer K (2007) Der kreative Zufall. Wie das Neue in die Welt kommt. C.H. Beck Verlag, Munchen 11. Mainzer K (2009) Challenges of Complexity in the 21st Century an Interdisciplinary Introduction . Eur Rev 17(2):219–236 12. Popov EV, Semyachkov KA (2017) Features of managing the development of the digital economy. Manag Russia Abroad 2:54–61 13. Presidential Executive Office (2018) The Decree of the President of the Russian Federation “On National Goals and Strategic Tasks of the Development of the Russian Federation for the Period until 2024” (May 7, 2018 No. 204), Moscow, Russia 14. Roubini N, Mihm St (2010) Crisis economics: a Crash course in the future of finance. Penguin Press, Lonon 15. Savich YuA (2018) Digital transformation and its impact on the competitiveness of industrial enterprises. Econominfo 4:44–48 16. Stefanova NA, Sedova AP (2017) The model of digital economy. Karelian Sci J 6(1(18)):91 17. Svistunov VM, Lobachev VV, Aleshin AA (2017) Modern problems of personnel training and retraining for small businesses. Hum Resour Intellect Resour Manag Russia 3(30):30–35 18. Teubner T (2014) Thoughts on the sharing economy. In Proceedings from MCCSIS: MultiConference on Computer Science and Information Systems, Lisbon, Portugal, pp 322–326 19. Vittikh VA (2010) Problems of control and modeling in complex artificial systems. Mech Autom Manag 12:17–23 20. Vusovic S (2009) Efficiency analysis of the US Biotechnology industry: clustering enhances productivity. AgBioforum 12(3 & 4):422–436 21. Zakharenko M (2016) New technologies in the economy – finds and losses. BIT Bus Inf Technol 8(61):19 22. Zhirov VF (2011) E-management as an effective tool for globalization. Sci Modern 14:275
Agriculture in the Digital World Ludmila N. Usenko , Aleksandr N. Tarasov , Victoria A. Guzey , Anastasia M. Usenko , and Alina S. Bidzhieva
Abstract This paper focuses on the possible composition and structure of digital platforms in agriculture. Industry software is given a special place to plan, organize, and manage agricultural activities to maximize the opportunities of the digital economy. At the same time, several consequences are formed for the agricultural sector and society as a whole. Understanding these risks is necessary to build an effective and secure digital future. Keywords Digital platform · Software · Digitalization · Digital production management
1 Introduction The digitalization of the domestic economy has a long history and has gone through several stages. In 1939, Leonid V. Kantorovich published “Mathematical Methods for Organization and Planning of Production” [6], thereby initiating the use of “numbers” to increase the efficiency of the use of innovations in human economic activities. The period from the mid-1940s to the early 2000s can be attributed to the first stage of the digitalization of the economy. The idea of using “numbers” in agriculture was formulated in 1952 as the task of optimal programming of the crop. By the early 1980s, large-scale research, and experimental and practical work on programming the yields of the first digital technologies for the cultivation of crops were carried out in the USSR. After the 1950s, software and an extensive network of information and computing centers were created, making it possible to generate information that provides the opportunity to achieve maximum productivity in agriculture based on the optimal use of production resources in the prevailing agrometeorological and soil conditions. During 1983–1990, the area of programmed crops increased from L. N. Usenko · V. A. Guzey (B) · A. M. Usenko · A. S. Bidzhieva Rostov State University of Economics, Rostov-on-Don, Russia A. N. Tarasov The Federal Agrarian Scientific Center of Rostov, Rostov-on-Don, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_21
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1.0 million hectares in 1983 to 6.49 million hectares in 1990 [15]. During this period, the digital technology of programmed harvests provided 20%–30% growth in yields [15] of grains, vegetables, and forage crops throughout the USSR. Since the beginning of the 2000s, the second stage of the digitalization began in Russia, which continues to this day, approaching its equator. We can define this stage as the “digitized economy.” Market agents and households are shifting to the massive use of digital devices and technologies in public and private communications, while enterprises and organizations are digitizing and automating existing production and planning processes, organizing and managing economic activities [5]. At the same time, the production is dominated by traditional resources and institutions for carrying out economic activities. By the beginning of 2018, 92.1% of Russian organizations conducting economic activities used computers, 50.6%— servers, 61.1%—local area networks, 88.3%—e-mail, 89.7%—global information networks, 41.2% placed orders for goods, works, and services via the Internet, and 20.1% used the Internet to receive orders [15]. Our forecasts indicate that at the turn of 2023–2024, the digitalization of the Russian economy may accelerate and enter its third stage—the “digital economy,” which will end in 2037–2040. It will be an economy of a new technological order with the digital organization and production management, new labor relations, and new objects and means of labor [15]. Several studies agree to call the emerging technological order “bioinformatics” [14, 18]. The trends that currently determine the content of “digitalization of agriculture” are primarily aimed at digitizing existing technological solutions [2, 4, 13, 19, 20], which threatens to lag behind the global pace of digitalization of the economy. The purpose of the study is to substantiate technological, organizational, and economic solutions that provide a dynamic digital transformation of Russian agriculture. With the prevailing trends in the informatization of economic activities and public and private life in Russia [4, 14, 19], the formation of digital industry platforms based on domestic software [12, 17] and biotechnology and biological resources [7, 9, 17] is a necessary condition for the transition to the third stage of digitalization, to the “digital economy.” Following the purpose of the study, the following tasks were solved: – the experience of introducing digital technologies into agricultural production in the USSR and Russia was studied; – a statistical analysis of the spread of information technologies in the Russian economy, particularly in Russian agriculture; – an expert survey was carried out on the prospects for the spread of information technologies, priority areas of digitalization in public and private life in the Russian Federation; – based on the analysis of scientific and technological forecasting results and an expert survey, trends in digitalization, risks, and threats of the digital transformation of economic activities are revealed;
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– using the example of viticulture, methodological approaches to creating digital industry platforms based on domestic software, biotechnology, and biological resources are proposed.
2 Materials and Methods The methodological apparatus is based on a system of general scientific and local methods and techniques for obtaining scientific knowledge, a systematic approach using monographic, economic and statistical methods, the method of expert assessment, and scientific and technological forecasting. The information base of the research was made up of state statistics, the results of scientific, technological, and regulatory forecasting [7–10], and materials of an expert survey (N = 29). The experts were researchers performing fundamental, exploratory, and applied research in information technology, of which 20 people are candidates and doctors of sciences and nine specialists with special education. On average, all the respondents have been working in the digitalization of agricultural production for 15 years.
3 Results The results of our research indicate that the large-scale and rapid spread of digital technologies, which began after 2008, is because digital solutions bring not only savings in working time and material resources, but also have the potential to support and accelerate economic growth, which became essential after the global financial and economic crisis of 2008. However, the analysis of statistics and the results of an expert survey indicate an insufficiently high rate of the digitalization of Russian economy. A moderate rate of use of information technology in economic activity was stated by 44.8% of experts, 13.8% of experts noted that digital transformation is proceeding at a slow pace. However, 51.7% of experts predict high rates of application of information technology in the economy, and 10.3% believe that the rates will be moderate in the nearest future. At the same time, 82.8% of experts (respondents could choose several answers) consider creating and implementing analytical information products and systems in economic activities as priority areas of digitalization of the economy. Additionally, 48.3% of respondents indicated the creation and use of control systems and automation of production processes. The results of our analysis presented for the implementation of innovative projects within the framework of the future Southern Scientific and Educational Center “Digital transformation of the agro-industrial and industrial complex” (the authors acted as experts) and the results of our sociological research indicate that the trend of digitizing the economy remains a priority in Russia. This is primarily determined by
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such factors as the rent-oriented behavior of the agrarian business elite and largescale foreign technological borrowing. Suffice it to say that in 2018, for example, when planting new vineyards, the use of seedlings of domestic selection was 42%. All the above factors can lead to the next stage of borrowing foreign technologies from the digital economy and the degradation of the national technological system [3]. However, as evidenced by the research results, these aspects of digitalization are not the only risks and threats to the socio-economic development of Russia. The interviewed experts testified that the spread of information technology in all spheres of human society could lead to the fact that the state, certain groups of individuals, or organizations will be able to gain complete control over the private and public life of a person (48.3%), get an uncontrolled invasion of privacy (37.9%), and manipulate of public behavior (17.2%). Digital openness of the economy and private life can lead to other risks and threats: impact on the economic security of the state, manipulation of markets, the formation of financial bubbles, and increased risk of market collapse [11]. The blurring of the boundaries of the state and private life and the transpersonal and supra social domination of digital platforms pose philosophical and ethical problems of digitalization of the economy and all human lives. The solution to the problem of preserving human freedom in a digital society and their individuality is based on fostering independence in thinking and analyzing what is happening, preserving the national spiritual and moral foundations [14], and creating a supranational new social contract [1] by analogy with agreements within the WTO, declarations, convections of UN, and other international organizations.
4 Discussion Our research shows that complex technological solutions are required for the successful transition of digital transformation to its third stage of development— the digital economy. The complexity of the technological solution lies in the fact that information technologies are actively introduced into production processes, management technologies, marketing schemes of goods circulation, and new resources, new institutions of organization, forms of combining labor, and objects of labor. The results of predicting fundamental and exploratory research indicate a high probability of implementing an integrated approach to the digitalization of the economy. Thus, for the values of the indicators for identifying the results of forecasting scientific research (the ratio of the results of scientific forecasting with the promising directions of scientific and technological development of Russia), calculated at the Institute for Problems of Science Development [17] in the direction of research “information technology,” 29 scientific results refer to information and communication technologies and 5 to biotechnology [17]. Therefore, the results create the proper scientific groundwork for the design of an integrated technological solution based on digital and biological resources. Digital platforms can become one of the options for such solutions.
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The experience in automation of technological processes in agriculture, programming of crops and optimal planning [15], existing and developing industry software [12, 19], innovative technological mechanisms and institutions for the introduction of new non-traditional resources in agricultural production in addition to labor, capital, and land [18] allow us to propose the following structure and composition of agricultural digital platforms, which are very likely to have a certain and economic typology caused by soil and climatic conditions and labor skills, and culture of the population. For example, in viticulture, digital agricultural platforms may include varietal and species, product technologies, planting material of the Virus Free category, Virus Test, information systems, and software products: “Single information window” (rusprofile, list.org.com geographic information systems, computer programs “TEOAgro2,” “Ampelography,” “Evaluation of target indicators of food independence” [16]. The digital sectoral agricultural platform is a tool for technologically and economically sound management of innovative and technological development of agriculture based on technologies and resources of the bio-information technological order. The digitalization of agriculture reflects the achieved level of scientific and technological progress and is implemented in digital industry platforms. This implies the readiness of users to implement technological and management solutions embodied in digital platforms. Digital livestock platforms can be formed around the computer program “Financial and Economic Support for Innovative and Technological Development of Agriculture” (Rospatent certificate No. 20190666995). The considered options for digital platforms are schematic and reflect the possibilities of creating an innovative product based on the results of domestic research in various branches of agriculture. It seems to us that digital platforms of various types should be compatible. This raises the question of the technical regulation and functioning of digital platforms. Considering the economic effects of digitalization and its threats and risks, it is advisable to leave regulation of the creation and operation of digital platforms to the state and not transfer it to self-regulatory organizations.
5 Conclusion The information basis of digital platforms in agriculture is databases that archive materials of scientific and field experiments, forecast calculations, statistical reports, and other information sources of knowledge, which are transformed by the operator into an information system. At the same time, as we noted above, the risks of data manipulation by both the operator and the user of the digital platform remain, which may violate the economic, private, and other interests of third parties and lead to the commission of illegal and inappropriate actions in the context of economic reality, the commission of risky business transactions. Furthermore, these are already questions of technical regulation, moral and legal responsibility, and the preparedness of a person to live in a digital society.
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In this regard, the path of a person’s broad access to platforms that are interoperable with digital systems lies not only within the legal framework but also within the framework of the awareness of personal responsibilities when using digital technologies in private life or economic activity. Digitalization and its particular directions in agriculture are presented to the public and business community as an innovation that became a practical reality just a few years ago. The work and talent of domestic scientists, who laid the theoretical, methodological, and instrumental foundations for the digitalization of agricultural production, are being forgotten. A technological breakthrough to the digital economy is impossible without using the historical experience of these processes in our country.
References 1. All-Russian Scientific Research Institute of Economy and Standards (1995) Methodical recommendations for the development and application of an automated system for planned calculations. GS “Reklama”, Rostov-on-Don 2. Baydakov AN, Nazarenko AV, Babkina ON (2017) Forecasting directions of innovative development of fruit growing. Agric Bull Stavropol Reg 4:127–134 3. Ershov MV (2019) On some problems of digitalization. VEO Russia Proc 220:144–151 4. Fomin A (2019) The “digital agriculture” project is a driver of the innovative development of the AIC. Agro-Ind Complex: Econ Manag 11:72–76 5. Ganichev NV, Koshovets OB (2019) Technological breakthrough based on the development of a new digital economy: opportunities, problems, risks. Forecast Probl 6:48–59 6. Kantorovich LV (2012) Mathematical methods of organization and planning of production. St. Petersburg State University, St. Petersburg 7. Kuznetsov VV et al (2010) Technological development of the meat sub-complex of agriculture of the Russian Federation: current state, forecasting methodology, and forecasts. Don State Agrarian University, Rostov-on-Don 8. Kuznetsov VV, Gaivoronskaya NF, Grigorieva GV, Trofimenko IL, Bakhmut AS, Salmanova IR, Yakovenko YuYu (2011) Target forecasts of technological development of the crop production industry. BHIICX, Rostov-on-Don 9. Kuznetsov VV, Garkavy VV, Gaivoronskaya NF, Grigorieva GV, Trofimenko IL, Bakhmut AS, Kartamysheva AA, Salmanova IR (2010) Forecasting the technological development of crop industries at the federal level. State Scientific Research Institute of Economics and Standards, Rostov-on-Don 10. Kuznetsov VV, Tarasov AN, Gaivoronskaya NF, Egorova OV, Grigorieva GV, Bakhmut AS (2017) Forecasting parameters of innovative development of agricultural sectors: theory, methodology, and practice. All-Russian Scientific Research Institute of Economics and Standards, Rostov-on-Don 11. Marinichev DN (2019) Where digital trends lead. VEO Russia Proc 220:169–176 12. Mindeli LE, Ostapyuk SF, Fetisov VP (2019) On the results of long-term forecasting of fundamental and exploratory scientific research. Econ Math Methods 4(55):5–27 13. Morgunova AV (2016) The development of food technologies with preventive properties based on computer modeling. In: Priority and innovative technologies in animal husbandry – the basis for the modernization of the agro-industrial complex of Russia. Stavropol State Agrarian University, Stavropol, pp 124–127 14. Svistunov VV (2015) Bioinformation economy: trends, cultural and moral foundations. AzovPrint, Rostov-on-Don
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15. Tarasov AN (2019) Digital systems in the agricultural economy. In: Proceedings from international scientific and practical conference: cross-border factor: the pros and cons of farming, Rostov-on-Don, Russia, pp 157–169 16. Tarasov AN, Maksutova LG, Gaivoronskaya NF, Kavardakov VY, Pavlushkina OI, Shchitov SE, Antonova NI (2019) The catalog of scientific and practical recommendations, software for innovative developments of scientists VNIIEiN. AzovPrint, Rostov-on-Don 17. Tarasov AN, Kavardakov VY, Semenenko IA (2017) Normative forecasting of innovative and technological development of animal husbandry in the Russian Federation based on bioinformatics technological paradigm: theory, methodology, and practice. AzovPrint, Rostov-on-Don 18. Tarasov AN, Kavardakov VY, Semenenko IA, Maksutova LG (2018) Innovative and technological development of animal husbandry in the Russian Federation in the context of the industry’s transition to a bioinformation technological mode: theory, methodology, and practice. AzovPrint, Rostov-on-Don 19. Troshkov AM, Troshkov MA, Shlaev DV, Samoilenko IV, Rachkov VE, Zhuk AP, Rezenkov DN (2017) Designing a model for digital processing of human biometric characteristics. Agric Bull Stavropol Reg 4:57–62 20. Yurin DA (2016) The selection of computer programs for calculating rations. In: Priority and innovative technologies in animal husbandry – the basis for the modernization of the agro-industrial complex of Russia. Stavropol State Agrarian University, Stavropol, pp 224–226
Digital Transformation in Agriculture: Goals, Tasks, and Main Development Paths Elena A. Batishcheva , Roman V. Kron , Anna F. Dolgopolova , Ludmila A. Latysheva , and Vladimir P. Shibaev
Abstract Currently, domestic agriculture has great potential. Under the current conditions of the food embargo and, as a consequence of the need for import substitution of a significant share of products, it shows noticeable positive dynamics and growth rates. The most significant successes were achieved primarily in the crop production sectors, which, ultimately, allowed Russian agriculture to enter the global agricultural food markets decades later. However, it is impossible to deny the fact that, for several developments and efficiency indicators, domestic agricultural production lags significantly behind the leading economies, which will not allow us to reveal our export potential fully. In the long term, the end of “counter-sanctions” will negatively affect the results of fierce competition with external producers and food imports. Based on the preceding, it is proposed to consider the possibility of introducing elements of the digital economy in the field of agriculture, through digital technologies in crop production and animal husbandry, storage, and processing of products, the management system in the agricultural sectors, as the main direction for increasing the efficiency of agricultural production. The focus is made on smart digital networks. Keywords Digital transformation · Digital agriculture · Competitiveness · Digital technology
1 Introduction The growth of grain yields, in 2019, relative to 2000, amounted to more than 60%, due to government support measures in terms of high costs for the preferential purchase of agricultural equipment and significant technical re-equipment of the industry. However, it is still inferior to the levels of technologically and innovatively developed economies (Germany (3 times), the USA, and Canada (4 times)), while the cost of production per employee is lower than that of the US and Canada by 22 times. E. A. Batishcheva (B) · R. V. Kron · A. F. Dolgopolova · L. A. Latysheva · V. P. Shibaev Stavropol State Agrarian University, Stavropol, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_22
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Consequently, the potential for growth, development, and modernization of agricultural production is great, and the realities of export and the need to ensure food security indicate the necessity to transform domestic agriculture into a high-tech industry with the integration of the latest innovative developments, including in the field of management decisions, which will increase production efficiency at all stages of the agro-industrial complex redistribution.
2 Materials and Methods According to expert estimates, the heads of agricultural enterprises, managers of various levels, and farmers, within the calendar year and production cycles, have to make more than 40 critical management decisions in concise and limited periods. Almost all of them significantly affect the efficiency and economy of agricultural production and are associated with the need to quickly search, obtain, and process large amounts of information. However, a significant number of subjects may encounter difficulties and limitations in access to this information. The lack of necessary information and loss of time is very expensive for Russian agricultural producers and the industry as a whole. This study was based on a systemic and logical approach. In the process of preparing the study, methods of analysis, synthesis, induction, and deduction, as well as descriptive techniques, were used.
3 Results In order to increase the competitiveness of the economy, to bridge the gap in labor productivity and the efficiency of the main technological processes of agricultural production, as well as to increase the effectiveness of government support measures and governance mechanisms, elements of a digital transformation system for agriculture are being developed and implemented, which should become one of the primary and essential links in the domestic digital economy. From the point of view of digitalization, agriculture has several characteristic features that determine the potential and effectiveness of IT innovations. Firstly, this is a large number of external factors that influence the results of production processes. Moreover, they, as a rule, can have multidirectional dynamics, both in space and in time. This, in turn, causes high costs even within the framework of a specific economic entity [2]. Secondly, the adoption of timely and effective management decisions is negatively affected by a large number of interaction subjects within the framework of various production chains, their spatial remoteness, and dispersal. Thirdly, there is a complex system of the totality of inter-industry relations within agricultural production and with subjects of other sectors of the agro-industrial
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complex as a whole (resource suppliers, buyers, and processors of finished products), which leads to a considerable number of transaction costs. The studies carried out within the framework of the departmental project “Digital Agriculture” (Fig. 1) indicate deficient current levels of digitalization of its industries, insufficient supply of knowledge and best practices in the field of innovative technological processes, unsatisfactory level of provision of agricultural producers with information, technical means, and equipment. A high level of costs is often caused by the low level of development of logistics, storage, and delivery systems. A very limited part of the entities has sufficient resources for the acquisition and implementation of modern IT solutions, equipment, and platforms. The situation is complicated by the low level of agricultural production with IT specialists, and their number is two times lower than the relatively more developed agricultural sectors of the EU economies. According to the Ministry of Agriculture of the Russian Federation, about 90,000 employees with competencies “Digital Economy” are required in the industry. Under the current conditions, scenarios of digitalization and substantial innovative transformation of the industry, as well as its integration with other vectors of the accelerated development of digital economy, without incentive mechanisms and direct participation of the state, will, at least, require long implementation and will not be complex and structured. This means that the obtained result would be less effective. This predetermined the decision on the formation of the National Platform for Digital State Administration of Agriculture, as well as the departmental project “Digital Agriculture” as part of the program “Digital Economy of the Russian Federation” (July 28, 2018 No. 1632-r) approved by the Government of the Russian Federation. The main goal of these measures is the transformation of agricultural industries based on innovative digital technologies and platforms for leveling technological gaps in the agricultural sector, ensuring significant productivity growth and lower costs [1]. Such an ambitious project requires significant investment. According to the Ministry of Agriculture, 300 billion rubles will be attracted and financed within Fig. 1 Digital agricultural environment. Source Developed by the authors
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80,900.00
21,450.00 2019
33,500.00 2020
59,150.00
60,000.00
2022
2023
45,000.00
2021
2024
Fig. 2 Total expenses for the implementation of the “Digital Agriculture” project, million rubles. Source Developed by the authors
the framework of a departmental project for the development and implementation of digital technologies until 2024. (Fig. 2). At the same time, 152 billion rubles will be financed from the federal budget. (50.66%). Eight billion rubles will be financed from regional budgets (2.66%), and another 140 billion rubles (46.68%) will be attracted from extrabudgetary sources, as part of a public–private partnership. Digitalization will take place in stages in a system of four main blocks, within the framework of which both common strategic goals and tasks of the national and regional level, as well as tactical applied tasks, located at the levels of individual economic entities, will be solved. One of the main and fundamental elements will be the national platform “Digital Agriculture,” which will be the basis for data processing and analysis on the resource potential of the industry. At the same time, the specific gravity (Fig. 3) of agricultural areas and data on their structure, bonitet, and other agro-climatic features “digitized” within the platform will increase from 50 to 100% by 2024, the share of digitally processed and analyzed information on farm animals (data on the structure of livestock, productivity) will increase from 25 to 100%. At the same time, the proportion of data on the composition and structure of the tractor fleet, agricultural machinery, and equipment available in
3%4% 15%
78%
The costs for the design and implementation of the national platform "Digital Agriculture" The costs for the creation and implementation of the "Agro Solutions" module The costs of creating a system of continuous training and training of agricultural specialists The costs of implementing the departmental project "Digital Agriculture"
Fig. 3 The structure of costs for the project “Digital Agriculture.” Source Developed by the authors
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the digital platform system for the period of implementation of digital systems will increase from 45 to 100%. The development and implementation of the “Digital Agriculture” platform will take 78% or 118.08 billion rubles of the project’s financial resources [3].
4 Discussion As part of this block, the following list of key events will be carried out and implemented: • The concept of a digital platform with an integrated system of processes and mechanisms was developed. Conceptual, technical, and parametric requirements for ensuring agricultural production were systematized. Standards and regulations have been developed for the collection, transfer, storage, analysis, and interpretation of the necessary information to ensure their accounting, monitoring, and analytics at the regional levels. The rules for interdepartmental and intersectoral interactions are defined and implemented. • Information and telecommunications infrastructure of a digital platform with integrations of all levels and links of agricultural production were designed and deployed. Specialized dedicated servers will be allocated to deploy the digital system. • The elements of a regulatory reference documentation management system were developed and implemented; regulatory reference books were registered and filled out, a mechanism for their continuous updating was implemented, data were synchronized with tools using artificial intelligence. A system of data mining and calculating possible scenarios will be formed. • Government support measures were implemented in the framework of financial incentives to fill the digital platform with the data of the primary links of the system through regulated digital products. Reducing transaction costs and increasing the level of interaction of agricultural production entities, including with contractors of other sectors of the agro-industrial complex, as well as increasing the efficiency of production processes, will be implemented in the structure of activities of the digital module “Agro Solutions” for the implementation of which 22.8 billion rubles will be allocated (15% of the financial resources of the project) (Fig. 4). The following measures will be implemented until 2024: • The development and implementation of the technical requirements of the specialized module “Agro Solutions” and its integration into the domestic system of the digital economy. • Design and implementation of a system that ensures effective interaction of entities of the agricultural market. The “Electronic Marketplace” and the subsystem “Personal Accounts of Agricultural Producers” will be implemented, as well as the
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Fig. 4 State support in the framework of subsidizing digitization of data, million rubles. Source Developed by the authors
subsystem “Finance,” which will include electronic document management tools, government support, and financing measures, digital lending service “Business Modeling,” basic federal and regional digital services. • The tools for the continuous support of the operational activities of agricultural entities within the framework of integrated digital solutions, including “Smart Field,” “Smart Flock,” “Smart Farm,” “Smart Garden,” “Sharing of Capacities and Equipment,” etc. will be developed and implemented. A shortage of personnel with the necessary qualifications will be solved by organizing a system of continuous training of specialists with competencies in the fields of Digital Agriculture and Digital Economy. Agrarian universities will become representative offices of the “Center of Competencies “Digital Agriculture.” Based on the studies, the needs for the necessary specialists in the digital transformation of the industry will be determined, and the necessary institutional environment will be formed. Within the framework of this block of measures, the educational environment “Land of Knowledge” will be developed, which will provide qualified distance training for agricultural specialists. Additionally, an institutional subsystem of professional retraining of specialists will be formed, including those released as a result of digital transformations in the industry. Mechanisms for the professional orientation of schoolchildren to study in the necessary specialties of professional education will be initiated. The practical implementation of the activities of the digital transformation personnel support unit will require 5.368 billion rubles - vocational guidance of students to study in the vital areas of education (Fig. 5). The practical implementation of the activities of the digital transformation personnel support unit will require 5.368 billion rubles. Undoubtedly, domestic agriculture (Fig. 6) has significant reserves for increasing efficiency (3–5 times relative to the leading economies of the EU, USA, and Canada) and significant potential for growth in the industry’s turnover through the introduction of digital processes and technologies, increasing labor productivity.
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5,500.00 4,562.50 3,775.00 2,962.50
2020
2,725.00
2021
2022
2023
2024
Fig. 5 The costs for the design, creation, and implementation of the “Agro Solutions” module, million rubles. Source Developed by the authors
1,828.60
478.6
2020
2021
378.6
378.6
378.6
2022
2023
2024
Fig. 6 Expenses for the formation of systems for continuous training of agro-industrial complex specialists in the competencies of the digital economy, million rubles Source Developed by the authors
5 Conclusion The digital transformation of the industry should result in a general decrease in the share of material costs in the structure of the cost of agricultural products from 60 to 43% by 2024 and the achievement of a growth rate of labor productivity of 200% relative to 2018. At the same time, the gross product of the industry should reach a value of 5.9 trillion rubles; export revenue will grow to $45 billion, which will have a beneficial effect on the socio-economic development of rural areas.
References 1. Batishcheva EA (2019) Digital agriculture: current status, problems, and development prospects. Econ Agric Russia 1:2–6
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2. Batishcheva EA, Bezgina YuA, Zinisha OS, Goncharova NA, Ryndina IV (2018) Digital agriculture: current state, problems, and development prospects. Res J Pharm Biol Chem Sci 9(6):1556–1561 3. Skiperskaya EV, Gunko AYu, Batishcheva EA, Steklova TN, Kharchenko MA (2018) State and development trends of associated forms of agrarian business in the context of Russia’s membership in the WTO (on the example of the Stavropol territory). Res J Pharm Biol Chem Sci 9(3):782–786
Food Security in a Globalizing Environment Lyudmila Yu. Piterskaya , Tatyana G. Gurnovich , Lyudmila A. Latysheva , Victoria V. Prokhorova , and Elena O. Goretskaya
Abstract This paper discusses the main problems associated with the current state of the food security of Russia. The paper aims to justify the mechanism for adjusting the level of food security of the state. Since it is the foundation of the national security system, food security, as a whole, is determined by the effective state economic policy and foreign and domestic policies. Ensuring food security is the prerogative of the state, its implementation ensures stability and progress in its development, high quality of life of the population, and social peace. The current state of food security in Russia indicates the full supply of food to the population, and, for some food products, there is an excess of rational norms. However, it should be noted that the diet is unbalanced due to the high proportion of fats in food, which leads to an increase in patients with obesity and anemia. In order to conduct a comparative assessment of the food security of countries, the authors used a methodological approach, which is based on the calculation of the Global Food Security Index [GFSI], its components, and ranking by main indicators. The obtained results indicate the need to improve the quality of products and the availability of quality food for the bulk of the population. Scientific, technical, and innovative development is highlighted by expanding the use of public–private partnerships as a priority in ensuring the food security of Russia. Keywords Food security · Self-sufficiency · Balanced diet · Product quality · Food safety · Regulation
L. Yu. Piterskaya · T. G. Gurnovich Kuban State Agrarian University named after I. T. Trubilin, Krasnodar, Russia L. A. Latysheva (B) Stavropol State Agrarian University, Stavropol, Russia V. V. Prokhorova Kuban State Technological University, Krasnodar, Russia E. O. Goretskaya Plekhanov Russian University of Economics, Moscow, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_23
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1 Introduction The problem of ensuring food security was significantly updated after the introduction of economic sanctions against Russia, which served as the trigger for the actions of the government in this direction [2, 5]. Food security is a global issue that is closely monitored by international organizations. Thus, the assessment and monitoring of the level of change in food security of countries are carried out by the Food and Agriculture Organization of the United Nations [FAO]. Also, FAO implements measures to combat poverty and hunger in the world through the development of agriculture in depressed countries and ensuring access to food for the population of these countries. In the modern economy, there is a system of basic quantitative and qualitative indicators for assessing food security, which was developed in 1966 by the Rome Declaration on World Food Security. Following this declaration, the fundamental performance indicators are physical accessibility of food, economic affordability, sufficiency and safety, the ability to provide food to all segments of the population, and the reliability and sustainability of the national food system. Such a system of aggregated indicators is specified by a system of private calculated indicators, which are grouped into production, logistics, and consumer ones. It is the combination and correlation of these indicators, along with their harmonious and simultaneous interaction, that forms the basis of various food security models. There are autarchic, imperial, dynamic, and innovative models.
2 Materials and Methods The research subject was estimated data on food security in Russia in the context of global spatial globalization. The assessment was based on the dynamics of the Global Food Security Index [GFSI]. The study was based on system analysis, structural, and logical approaches. In the course of the study, economic-statistical and analytical research methods were used, as well as methodological tools of generalization, comparison, systematization, and argumentation.
3 Results The GFSI is a tool for studying and determining the state of food security based on assessments of availability, accessibility, and quality. It is calculated in 113 countries. The index is a dynamic quantitative and qualitative model of comparative analysis
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built based on 28 unique indicators that measure the drivers of food security in both developing and developed countries. The first group of indicators characterizes the availability and consumption of food (Affordability), the second group serves to assess the availability and sufficiency of food (Availability), the third group includes indicators of food safety and quality (Quality & Safety). Table 1 summarizes the methodology presented in the context of 113 countries, including Russia. The annual indicators of the Global Food Security Index, calculated based on the annual base model as of October 2018, are presented in Table 2. The resilience to risks associated with natural resources and climate poses long-term threats to food systems in different countries. Table 1 The Global Food Security Index of Russia Indicator
Points
Rank among 113 countries
2012
2013 2014 2015 2016 2017 2012
2013 2014 2015 2016 2017
66.7
65.6
62.8
61.5
62.3
66.2
40
39
44
48
48
41
Affordability 67.7
67.9
68.7
68.9
68.6
70.7
36
36
37
40
40
36
Availability
63.2
60.7
53.1
49.7
51.6
58.7
39
46
61
74
71
52
Quality & Safety
73.6
73.6
74.5
75.7
75.7
75.7
34
33
30
27
27
26
Overall score
Source [7]
Table 2 Annual indicators of the Global Food Security Index, 2018 Global ranking
Country
Overall score
Affordability
Availability
Quality & Safety
1st
Singapore
85.9
94.3
81.0
78.1
2nd
Ireland
85.5
87.8
83.6
84.8
3rd
United Kingdom
85.0
82.6
88.8
80.4
3rd
United States
85.0
86.8
83.2
85.4
19th
Portugal
79.3
76.7
78.7
87.3
20th
Israel
78.6
78.7
78.0
80.3
21st
Spain
78.0
79.2
74.9
83.6
42nd
Russia
67.0
70.5
61.0
75.2
43rd
Mexico
66.4
67.4
63.0
73.6
46th
China
65.1
65.0
63.1
71.1
Source [7]
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Table 3 shows the use of the coefficient of adjustment of natural resources and sustainability, as well as its fundamental indicators, in 2018, in various countries. The obtained grades are based on indicators of natural resources and sustainability. Table 3 Natural resources and sustainability, 2018 Global ranking Country
Category score
Global ranking
Global
Country
Category score
Exposure
1
Slovakia
81.7
1
Portugal
79.4
2
Denmark
81.5
2
Cote d’Ivoire
78.5
10
Portugal
75.7
2
Laos
78.5
18
Russia
73.4
4
Spain
77.8
19
Spain
71.9
34
Russia
67.9
22
Japan
71.7
36
Mexico
67.5
Water
Land
1
Uganda
97.8
1
Dominican Republic
97.2
2
Denmark
92.1
2
Bulgaria
94.4
3
Malawi
90.6
70
Portugal
81.9
45
Russia
61.5
72
Nigeria
81.1
72
Portugal
49.2
87
Russia
78.8
113
Israel
3.0
89
Switzerland
78.5
Sensitivity
Adaptive capacity
1
Australia
92.6
1
Austria
100
2
Czech Republic
84.6
1
Canada
100
39
Japan
58.2
1
Denmark
100
40
Portugal
57.7
1
Portugal
100
52
Egypt
53.9
23
Niger
91.7
53
Russia
53.0
23
Russia
91.7
Demographic stresses Global ranking
Country
Category score
1
Bulgaria
99.6
6
Japan
92.7
7
Poland
92.1
8
Portugal
91.8
12
Russia
88.1
13
Slovakia
87.5
Source [7]
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4 Discussion A vital target indicator of food security is the level of rational norms of food consumption per capita. The analysis of actual food consumption in Russia revealed that six out of ten products exceeded the recommended scientifically-based norms, while rational norms were not achieved in four groups: – significant excess in the consumption of bread, potatoes, and sugar; – insignificant excess of consumption for poultry meat; – non-compliance with consumption standards for vegetables, fruits, and fish. Thus, the nutritional value of the existing diet of Russians is generally unsatisfactory. The recommended norm has not yet been achieved, and the excess of fat intake is 14% (Table 4). In the consumption of products, there is an excess of the norms of consumption of fat, bread, and insufficient caloric content of the set. An increased level of fat in the diet of the Russian population and unbalanced nutrition leads to an increase in people suffering from obesity and anemia (Table 5). The concept of a balanced and healthy diet is becoming the basis for improving the quality of life of the population, increasing its duration. Table 4 The nutritional value of the current diet Indicator
Diet norms
2013
2014
2015
2016
2017
2017 in % to
Proteins
82
78
78
77
80
80
103
98
Fats
95
106
105
105
109
108
102
114
Carbohydrates
417
337
333
328
341
338
100
81
Energy value, kcal per day
2,850
2,626
2,603
2,575
2,675
2,655
101
93
2013
The norm
Source [1]
Table 5 The growth dynamics of obesity and anemia in the population of Russia Diseases
2014
2015
2016
2017
2017 in % to 2014
Obesity, thousand people
1557
1727
1825
1936
125.0
per 100 thousand people
1065
1180
1245
1319
125.0
Anemia, a thousand people
1586
1632
1638
1650
104.0
per 100 thousand people
1084
1115
1117
1124
104.0
The population of the country, million people
143.7
146.3
146.5
146.8
103.0
Source [1]
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Table 6 The average life expectancy, 2019 Rating
Country
Life expectancy, years The average for the population
Men
Women
1
Japan
83.7
80.5
86.8
2
Switzerland
83.4
81.3
85.3
3
Germany
83.1
80
86.1
11
The Republic of Korea
82.3
78.8
85.5
12
Canada
82.2
80.2
84.1
23
Portugal
81.1
78.2
83.9
108
Bolivia
70.7
68.2
73.3
109
The Democratic People’s Republic of Korea
70.6
67
74
110
Russia
70.5
64.7
76.3
Source [7]
At the same time, according to the World Health Organization, in 2019, the average life expectancy in Russia was 70.5 years (men—64.7 years, women—76.3) (Table 6). The average life expectancy in Japan is 83.7 years (men—80.5 years, women— 86.8 years). Nowadays, in terms of living standards and public health, Russia was in 119th place in the ranking of 188 states published in The Lancet [3]. Even North Korea and Honduras were ahead of Russia, taking 116th and 115th places, respectively. Iceland, Singapore, and Sweden took the first three places. The United States was in the 28th position. To solve modern problems of ensuring food security in Russia, it is necessary to develop innovative potential in this area and actively formulate scientific, technical, and innovative cooperation in the form of public–private partnerships (PPPs) [4, 6, 8]. We highlighted the basic principles of PPP: – The relations are based on the parity-beneficial interests of partners (the state and the agricultural producer); – The relationships in the PPP should be based on official documents (agreements, contracts, etc.); – The partners are united by common interests and solve a single state-important task; – Partners use the principle of co-financing for their activities, combining financial resources; – Partners share income, expenses, and risks among themselves in conditions of equality. Solving the problems of food security in Russia based on innovative and technological breakthroughs requires special conditions for the formation and functioning of PPPs. The most critical conditions are as follows:
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– The substantiation of the methodological apparatus for studying models of innovative interaction between the state and business; – The formation of a legal framework ensuring innovative business development based on PPP; – The creation of innovation and investment infrastructure; – The implementation of scientific and technical policies in agriculture; – The development of an effective mechanism for technical and technological modernization of agricultural production; – Progressive increase in the effectiveness of scientific and personnel potential; – The development of information and consulting services for agricultural producers.
5 Conclusion Thus, the assessment of the state of food security and the level of food security of the state allows us to come to the following conclusions: – The nominal provision of the Russian population with food was achieved; for some food products there is an excess of rational nutrition standards; – Excess fat in foods and, as a result, an imbalance diet of the Russian population leads to an increase in patients with obesity and anemia; – The key tasks are the need to improve the quality of food products and reduce the share of falsified food products in the market; – The income level of the population, along with the price factor in the segment of quality food products do not provide access to quality food for all segments of the population; – The cost of necessary food products occupies a fairly high share in the budget of the population, limiting the possibilities of its spiritual and intellectual growth; – Current conditions of economic globalization actualize the need to ensure food security in Russia based on scientific, technical, and innovative development through the use of public–private partnerships in the agricultural sector of the economy. In general, the mechanism for regulating food security in Russia needs to be actively adjusted to solve the problems identified in the analysis process.
References 1. Baturin AK (2019) Nutrition of the population of the Russian Federation. https://www.cnshb. ru/prezent/pnrf.pdf 2. Burdukov P (1999) Russia in the global food security system. Economics, Moscow
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3. GBD 2015 SDG Collaborators (2016) Measuring the health-related sustainable development goals in 188 countries: a baseline analysis from the global burden of disease study 2015. Lancet J 388(10053):1813–1850. https://doi.org/10.1016/S0140-6736(16)31467-2 4. Kuznetsov S (2008) The problems of innovative support for agricultural production. AIC: Econ Manag 6:38–39 5. Shagayda NI, Uzun VYa (2014) Food security in Russia: Monitoring, trends, and threats. https:// www.ranepa.ru/news/item/download/2148_3457100313aa5f2cfd9488b29087e302.html 6. Sklyarova Y, Sklyarov I, Latysheva L, Piterskaya L, Zenchenko S (2019) Theoretical and methodological features the investment analysis of the agricultural economy sector. Indo Am J Pharm Sci (IAJP) 6(3):5603–5610 7. The Economist Intelligence Unit (n.d.) Global Food Security Index. Ranking and trends. https:// foodsecurityindex.eiu.com/ 8. Uzun VYa (2005) Large and small business in agriculture in Russia: adaptation to the market and efficiency. Rosinformagrotehc, Moscow
The Korean Experience in Implementing the Fourth Industrial Revolution: General and Agricultural Aspects Svetlana V. Ivanova
and Artyom V. Latyshov
Abstract The paper focuses on the general and agricultural aspects of the fourth industrial revolution in the Republic of Korea [RK]. The paper aims at identifying the main trends of the innovative development of the RK. We considered several indicators that characterize the position of the country in international ratings. The heterogeneity of the innovation space of the RK is revealed, which determines the novelty of the work. The study used general scientific and statistical methods, comparisons, and content analysis. It is concluded that the Republic of Korea, with the active participation of the state, created the foundations of the material base for the deployment of the fourth industrial revolution. The greatest success is achieved in terms of Internet coverage, the production of information and communication technologies (ICT), which are highly competitive in world markets, in industrial robotics per 10 thousand people, in the development of e-commerce, especially in the B2B format. The B2C format is described as highly dynamic and referenced for the domestic market. The leading trading partner for cross-border B2C is the United States. Growing cyber threats (e.g., a limited number of secure servers per 1 million people) slow further growth of e-commerce. The diffusion of ICT in the field of agricultural production has a growing trend. The technologies of precision farming are gradually implemented. However, the issue of the economic efficiency of their use is still not solved. Keywords Digitalization · Fourth industrial revolution · Republic of Korea · E-commerce · Precision farming
1 Introduction The relevance of the work is determined by the rapid development of information and communication technologies, which have a comprehensive impact on modern S. V. Ivanova (B) · A. V. Latyshov Plekhanov Russian University of Economics (PRUE), Moscow, Russia A. V. Latyshov e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_24
201
202
S. V. Ivanova and A. V. Latyshov
86.6
80.0 60.0
53.6
40.0
47.0
20.0
19.1
0.0
Developed countries
90.0 80.0 70.0 60.0 50.0 40.0 30.0 20.0 10.0 0.0
82.5 77.2 72.2 51.6 48.4 28.2
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
100.0
Developing countries
Africa
Arab countries
World
APR
CIS
The least developed countries
Europe
America
Fig. 1 The share of citizens using the Internet by country according to the degree of economic development and regional affiliation, %. Source [5]
society. AI technologies, 5G communications, blockchain technologies, the Internet of Things, cloud technologies, and other modern technologies significantly speed up and simplify the exchange of information, goods, and services. However, the global innovation space is highly heterogeneous. Countries vary in the degree of using the Internet (Fig. 1). Thus, the population of developed countries actively uses the Internet in business and everyday life (86.6% of the total population as of 2019), while Internet users in developing countries are almost two times lower. In the least developed countries, only one in five people use the Internet. Regionally, the situation is also heterogeneous: with the unequivocal leadership of European countries and the countries of North and South America, less than half of the population of the Asia–Pacific region use the Internet. However, this does not apply to one of the leading countries in Asia—the Republic of Korea.
2 Materials and Methods In the course of the work, we used abstract-logical methods, content analysis, comparisons, groupings, and expert analysis. The research informational basis was the statistical data of various international organizations, particularly UNCTAD statistics and other Internet resources.
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3 Results The Republic of Korea is a country where, already in 2001, more than half of the population had Internet access [5]. In April 2019, the country, the first in the world, launched 5G technology [8]. The Logistics Performance Index of the RK is highly rated by the World Bank. According to this indicator, it overtakes such Asian countries as China, India, and Taiwan [11]. The Republic of Korea occupies an important place in the world’s trade in ICT goods (Fig. 2)—9% of world exports and 4% of world imports of ICT goods. At the same time, ICT products account for about 30% of all Korean exports and 20% of Korean imports [10]. It is noteworthy that one of the differences between South Korea and North American countries is a large proportion of older people buying goods online. More than 5 million Koreans, over the age of 60, surf the web, and more than half of them use messengers to communicate. At the same time, only 30% of US residents over 65 have a smartphone [3]. Several factors (digitalization of the economy, world leadership in technology, massive access to broadband, high-speed Internet, the prevalence of smartphones, the emergence of new online platforms and networks (second place in the ranking of the development of information and communication technologies)) contribute to the development of e-commerce in the RK [12]. Various ratings are used to assess the development of e-commerce and digitalization. One of them is the B2C E-commerce Index developed in 2015 by UNCTAD (Table 1). When calculating this index, several factors are considered: the proportion of the population that uses the Internet; the proportion of people over the age of 15 with a bank account; the number of secure servers; the reliability of the provision of mail services in the country. As in previous years, the top 10 included European countries (eight out of ten countries). Asia–Pacific is represented by Singapore (third place) and Australia (tenth place). The positions of the “Asian tigers” are as follows: Hong Kong was on the 15th place, and the Republic of Korea—on the 19th .
VietnamOther MexicoJapan 3% 0.4% 4% 4% Malaysia 4% USA 4%
Import PRC 38%
Singapore 7%
EU 21%
Republic of Korea 4%
Japan 4%
USA 16%
Singapore 4%
Taiwan 9% Republic of Korea 9%
Export
Other Malaysia 13.0% 2% Mexico 3% Taiwan 3%
EU 18%
Hong Kong 14%
Fig. 2 Geographical distribution of trade in ICT, 2017. Source [10]
PRC 16%
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Table 1 UNCTAD B2C E-Commerce Index, 2019 No
Country
1.
Netherlands
2.
Switzerland
3. 4.
Ranking place (2019)
The percentage of people using the Internet (2018 or later)
The percentage of people over the age of 15 with a bank account (2017)
The number of secure servers per 1 million people (normalized) (2018)
UPU mail reliability assessment (2018+)
1
95
100
98
93
2
94
98
95
95
Singapore
3
88
98
97
97
Finland
4
94
100
90
94
5.
UK
5
95
96
88
98
6.
USA
13
87
93
95
90
7.
Hong Kong
15
89
95
85
92
8.
Republic of Korea
19
96
95
67
99
9.
Japan
21
85
98
81
86
10.
Russia
40
81
76
75
80
11.
China
56
54
80
55
85
Source [10]
We should note the dynamic change in the position of the Republic of Korea in this rating. In 2016–2017, the country was in seventh and fifth places. In 2018, there was a sharp drop down to 21st place. The authors evaluate such a change as “costs of growth.” Increased involvement in e-commerce outpaced the growth in the number of secure servers per 1 million people. Singapore had a different way—23rd place in 2016 and second place in 2018. Hong Kong practically did not change its position. Even though the RK ranks in the third tens in the rating of B2C e-commerce readiness, in 2017, in terms of e-commerce volumes (B2B and B2C) according to UNCTAD, it was among the top five countries (Table 2), occupying the third position among Asian countries (after Japan and China). In the e-commerce of the RK, there dominate the transactions of B2B format (95%) (in the USA—90%). One of the trends of recent years is the development of cross-border B2C sales. Even though most buyers purchase goods online from local companies, the share of people ordering goods online from abroad increased from 15% in 2015 to 21% in 2017 [10]. In South Korea, most cross-border purchases come from the United States (48%), followed by China (15%), and Japan (13%) [4]. In Korea, domestic online purchases, including purchases via PC and mobile devices, reached $69.2 billion in 2017, compared with $55.9 billion in 2016 [6]. According to UNCTAD estimates, the Republic of Korea is among the top ten countries in terms of cross-border B2C sales. Nevertheless, their share in B2C sales
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205
Table 2 Top 5 countries in terms of e-commerce, 2017 No
Country
The volume of Share in e-commerce, GDP, % $ billion
B2B, $ billion
Share in electronic commerce, %
B2C, $ billion
The average annual expense per customer, $
1.
USA
8,883
46
8,129
90
753
3,851
2.
Japan
2,975
61
2,828
95
147
3,248
3.
PRC
1,931
16
869
49
1 062
2,574
4.
Germany
1,503
41
1,414
92
88
1,668
5.
Republic of Korea
1,290
84
1,220
95
69
2,983
World
29,367
25,516
Source [10]
remains insignificant—3.8%. Koreans are characterized by a focus on the domestic market (Table 3). Thus, digitalization and a constant emphasis on the development of information and communication technologies had a significant impact on the growth of e-commerce in the RK. Nowadays, several B2B and B2C electronic trading platforms operate in the country (Gmarket, 11Street, Auction.co.kr, WeMakePrice, Interpark.com, Ssg.com, Ticketmonster.co.kr, Coupang.com, Lotte, etc.), through which electronic commerce is carried out. According to experts [3], the e-commerce market in the Republic has highly competitive advantages. This allows local companies to compete with potential foreign players in the price-quality ratio successfully. Buyers are sophisticated in Table 3 The assessment of cross-border B2C sales: top 10 exporters of goods No.
Country
Cross-border B2C sales, $ billion
Share in commodity export, %
Share in B2C sales in general, %
1.
USA
102
6.6
13.5
2.
PRC
79
3.5
7.5
3.
UK
31
7.0
15.0
4.
Japan
18
2.6
12.2
5.
Germany
15
1.0
17.1
6.
France
10
1.8
10.6
7.
Canada
8
1.8
12.7
8.
Italy
4
0.7
16.2
9.
Republic of Korea
3
0.5
3.8
10.
Netherlands
1
0.2
5.0
412
2.3
10.7
World Source [10]
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choice and used to receiving services quickly and efficiently. In the e-commerce market, changes are occurring extremely fast.
4 Discussion In general, the high level of innovation in the economy of the RK leaves out the question of implementing fundamentally new technologies into traditional activities (in particular, in agriculture). Several features characterize its condition. Perhaps, the main issue is the shortage of land. From 1995–2014, the share of farms with more than 3.0 hectares increased from 4.7% to 8.7%. However, in 2017, the average area of cultivated land per 1 farm was only 1.56 ha [7]. The Government of the RK set the task of expanding the scale of the farm, but it is implemented slowly. The RK is marked with a decrease in the rural population, low birth rate, and an aging population, which is a prerequisite for mechanization and robotization. According to the International Federation of Robotization, the RK is a world leader in the density of industrial robots concentrated in the processing industry. Their implementation in the countryside is still sporadic. The high efficiency of agriculture in the RK was achieved due to the production intensification, including the introduction of fertilizers and pesticides, which has its limits. In this regard, there arose the question of cultivating profitable organic agricultural products. Three factors will make the Fourth Industrial Revolution significantly affect the agricultural sector. Firstly, the accurate optimization of agriculture, which saves resources and the environment. Secondly, the reversal of elements of agricultural production. The capital, labor, and technological resources that left the villages are likely to return. Finally, the technological revolution can reduce the business risks associated with the weather. Currently, science does not have the means to predict and control the weather accurately, which determines the high variability of decision-making and the instability of agriculture [2]. In a comprehensive form, new technologies are embodied in precision farming [9], which allows monitoring the yield and health status of crops, diagnosing insect pests, and harvest time. Using the Internet of Things (IoT), one can measure temperature, humidity, and the amount of sunlight at sites and production farms, providing a remote control for mobile devices. The essence of such farming is the integrated management of plant (animal) growth following their needs while saving resources [1]. Back in the late 1990s, within the framework of the concept of “Low Input Sustainable Agriculture,” the introduced concept of precision farming became the subject of discussions by Korean scholars and practitioners. Rice fields became the object of research on the possibilities of applying future technology. During the experiments, it turned out that many sensors and smart machines developed in the USA and Germany are not suitable for rice fields flooded with water. The small area of land plots requires a more detailed consideration of the variability of land. Digital
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solutions developed in other countries require substantial refinement and adaptation to the Korean farming system. There is a question on the economic feasibility of introducing precision farming for individual farmers. The weaker, compared with large cities, the development of digital infrastructure and the insufficient educational level of farmers complicate the existing problem. Nevertheless, currently, the RK successfully implement the state program for creating an intellectual environment in rural areas. The implementation of pilot projects of smart farms is initiated in rice and other areas. The developed technologies and management are to be applied in the cultivation of orchards and vegetable crops of protected soil (for example, ginseng), which will allow obtaining positive economic effects. The Government of the RK announced a plan to create 4,300 jobs in smart agriculture by 2022.
5 Conclusion The Republic of Korea is at the forefront of economic innovation. However, the country has different progress in different criteria. To the greatest extent, the RK is “advanced” in terms of Internet coverage, in using 5G technology, in the development of new logistics services, and in the volume of trade in ICT goods. In terms of ecommerce, the RK is among the five leading countries. The structure of this type of trade is dominated by the B2B format. The B2C segment is relatively narrow but dynamic; there prevail purchases on the domestic market. In terms of cross-border B2C, the RK occupies the ninth place in the world. The country has created material and non-material conditions for the deployment of the fourth industrial revolution. Smart technologies are gradually spreading to the agriculture of the RK, which has several features, including small-scale farms, reduction, and aging of the population, excessive intensification of production. Despite the difficulties in adapting the tested technologies of Western countries to the Korean farming system, the country successfully implements the state program for creating an intellectual environment in rural areas.
Reference 1. Balabanov V (2013) Navigation technology in agriculture. Coordinate agriculture. Russian State Agrarian University – Moscow Timiryazev Agricultural Academy, Moscow. https:// bookz.ru/authors/viktor-balabanov/navigaci_258/1-navigaci_258.html 2. Bogoviz AV, Osipov VS, Chistyakova MK, Borisov MY (2019) Comparative analysis of formation of industry 4.0 in developed and developing countries. Stud Syst Decis Control 169:155–164 3. Eriksson T, Matheson K, Pitt L, Plangger K, Robson K (2019) E-commerce in South Korea: a Canadian perspective. https://www.asiapacific.ca/sites/default/files/filefield/south_korea_ecommerce_report.pdf
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4. International Post Corporation (n.d.) Cross-border E-commerce shopping survey. https://www. ipc.be/services/markets-and-regulations/cross-border-shopper-survey 5. International Telecommunication Union (2019) Statistics. https://www.itu.int/en/ITU-D/Statis tics/Pages/stat/default.aspx 6. International Trade Administration (n.d.) South Korea commercial guide. https://www.trade. gov/knowledge-product/exporting-korea-market-overview?section-nav=1933 7. Kim S-C, Kim K-H, Lee J-S (2019) Rice precision farming in Korea. https://ap.fftc.org.tw/art icle/1412 8. McCurry J (2019) The US dismisses South Korea’s launch of the world-first 5G network as ‘stunt’. https://www.theguardian.com/technology/2019/apr/04/us-dismisses-south-koreaslaunch-of-world-first-5g-network-as-stunt 9. Sung J (2018) The fourth industrial revolution and precision agriculture. In: Hussmann S (ed) Automation in agriculture – securing food supplies for future generations. https://doi.org/10. 5772/intechopen.71582 10. UNCTAD (2019) Digital economy report, 2019. https://unctad.org/en/PublicationsLibrary/der 2019_en.pdf 11. World Bank (2018) Logistics performance index. https://lpi.worldbank.org/international/global 12. International Telecommunication Union (2017) Development Index 2017. https://www.itu.int/ net4/ITU-D/idi/2017/index.html
World and Russian Agriculture Facing Digitalization Challenges Svetlana V. Ivanova
and Galina V. Kuznetsova
Abstract The paper focuses on the digitalization of agricultural production as a sphere of activity with a potentially high return on innovation. The work aims to analyze the characteristics of the digitalization process of agro-industrial complexes [AIC] of different countries and Russia and identify opportunities and risks of this process for business and society, which determines the novelty of the study. The objectives of the study include highlighting the most dynamically developing forms of digitalization and related innovative technologies used in the agricultural sector of different countries, taking into account the factors of unevenness and varying degrees of readiness of countries to implement information technologies (IT), formulating the digitalization features of the Russian AIC. The study used the dialectical approach, historical, abstract-logical, and statistical methods. It is concluded that the implementation of the export-oriented model of agricultural development directly depends on the speed and breadth of the introduction of digital technologies in this industry. The features of the Russian AIC are revealed, its practices, and conditions of digitalization are analyzed. The authors believe that the digitization of the AIC is essentially a transition to the digital management of food security, the development of territories, rural society, and agricultural biocenosis. The technocratic approach to complex socio-economic systems is limited, especially in agriculture. It is necessary to avoid the gap between technological and social progress. Significant progress was revealed in Russia regarding the formation of adequate legislation, the partial use of precision farming technologies, and new agricultural management. The main directions of further digitalization of Russian agriculture are indicated. Keywords Digital transformation · Robotization · Biotechnology · Agriculture · Precision farming · Russia · Multinational companies S. V. Ivanova (B) · G. V. Kuznetsova Plekhanov Russian University of Economics (PRUE), Moscow, Russia e-mail: [email protected] G. V. Kuznetsova Russian Presidential Academy of National Economy and Public Administration (RANEPA), Moscow, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_25
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1 Introduction The relevance of the study is due to the dynamism, scale, and cardinality of the changes taking place under the influence of information and other fundamentally new technologies. This, according to K. Christensen, “… breaks the old path of development, or changes its direction, moves technology to a new higher step” [5]. The world is undergoing radical changes, which, according to Professor A. N. Spartak, twice the ability of society and politicians to adapt to them. The ongoing transformations are associated with disruptive technologies that radically change socio-economic conditions, production systems, business models, and everyday practices [18]. The term “digital economy” was created by Don Tapscott, who in 1994 published a book entitled “Digital Economy” [21]. For decades, this book identified the primary trend in the development of the global economy, and its title has become a brand of a new era. The concept of digital transformation also entered the scientific revolution, which means not just the introduction of new technologies for the automation of production, but the transition to new models of business organization around the entire perimeter of companies, a fundamental restructuring of production and management processes, the creation of new supply chains [10]. The importance of the ongoing changes prompted the governments of developed and some developing countries to start long-term development strategies based on digitalization tools. From 1997, the term digital economy has been officially used by the Ministry of International Trade and Industry of Japan. In 1998, the US Department of Commerce issued a report entitled Digital Economy Development [8]. In the interpretation of the G-20 summit, the term “digital economy” refers to a wide range of economic activities, including the use of: – Digital information and knowledge as a critical factor in production; – Modern information networks as an essential area of activity; – The effective use of information and communication technologies (ICT) as a factor in productivity growth and economic structural optimization [6]. The purpose of work is to identify business and society opportunities and risks based on the analysis of the characteristics of the digitalization process of AIC of different countries and Russia. The objectives of the study include highlighting the most dynamically developing forms of digitalization and related innovative technologies used in the agricultural sector of different countries, taking into account the unevenness and varying degrees of readiness of countries to implement IT, formulating the digitalization features of the Russian AIC.
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2 Materials and Methods The study is based on a conceptual understanding of the digitalization of complex socio-economic systems as the material (non-material) basis of globalization in the format of the “Washington Consensus” and postmodern paradoxes. A dialectical approach is used, which considers digitalization as a process, the moments of which are the expedient activity of the subject, the subject of activity, and the means to achieve a new globally digitized world order. In the course of the study, we used such methods as content analysis, historical, abstract-logical, and system analysis of statistical data and expert estimates. Reasoning and conclusions are based on statistics from official international organizations and Internet resources.
3 Results 3.1 The Main Features of Digitalization of the Agricultural Sector of Foreign Countries According to the world ranking of the potential positive effects of global technology, digital agriculture ranks first. Researchers are mostly optimistic about the digitalization of agribusiness, noting quite noticeable positive shifts. First of all, this concerns the expansion of distribution channels for agricultural products. Rural residents (even from the most remote areas) start to use online trading sites on the Internet to sell their products. In China, at least 10% of households sell their products through Taobao, one of Alibaba’s most popular venues. Sales of nuts amounted to $60 million in 2018 [11]. Moreover, this trend is developing, especially rapidly in African countries. In modern agriculture, robots are often used (remotely controlled drones, uncrewed agricultural machinery, vertical greenhouses, remote climate control in greenhouses and stall livestock breeding, the use of artificial intelligence (AI), and Big Data). In 2018, sales of agricultural robots amounted to $2.96 billion, and by 2025 it could reach $11.58 billion [23]. The use of robots is promising in the agricultural sector, not only for developed countries, where there is a shortage of labor, and salaries go up to 40% of all costs but also in developing countries with cheap labor that seek to ensure high standards of their products and bring them to global markets. The chemical industry, which has taken shape within the framework of the Chemical Industry 4.0 concept in recent years, contributes to the development of the AIC and is characterized by the transition to digital transformation using robotics, closedloop production, artificial intelligence, and databases. The digital achievements of the industry make it possible to analyze the state of plants and soil in combination with weather forecasts and market conditions, which allows farmers to increase the efficiency of their economy and reduce negative pressure on the environment [20].
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The most comprehensive technology is the Precision Farming system, based on soil and yield mapping, autopilot technology, and the normalized application of nutrients and water using GPS systems. According to Goldman Sachs, using this technology will increase productivity by 70% by 2050 and halve the cost of water for irrigation [7]. The United States is the undisputed leader, followed by Germany, Japan, China, France, and the Netherlands. The flagship in the field of robotic technology for such a system are the United States, the Netherlands, and Japan [17]. The use of biotechnology is expanding. In the modern sense, biotechnologies are methods and technologies for the production of valuable substances and products using living organisms, parts of cells, and biological processes [25]. The most characteristic example in this area is soy, which has evolved from local to global culture. According to estimates, from 1996 to 2018, areas under transgenic crops increased from 1.7 million to 191.7 million hectares and amounted to 13% of all arable land. The cultivation and production of GM products in the world employs 17 million farms. The most significant areas under these crops are occupied in the USA (75 million hectares). The second and third places are occupied by Latin American countries—Brazil (51.3 million hectares) and Argentina (23.9 million hectares) (Table 1). Biotechnologies are developing rapidly in China, where biotechnological cotton (3.7 million ha) is especially successfully cultivated. The foreign expansion of Chinese capital is also growing. So, the company “Chem China” acquired a controlling stake in the Swiss company Syngenta, which allows China to access a wide range of ready-made commercial GM crops and become one of the leaders in the development and use of biotechnology [16]. Table 1 The area under GM crops in some countries, million hectares Country
Area Country share Types of crops in GM sown area, %
USA
75.0 40.3
Brazil
51.3 23.3
Corn, soybeans, cotton, rapeseed, sugar beets, alfalfa, papaya, pumpkin, potato, apples Soybeans, corn, cotton, sugarcane
Argentina 23.9 13.4
Soybeans, corn, cotton
India
11.6
6.4
Cotton
Canada
12.7
6.3
Canola, soybeans, corn, sugar beets, alfalfa, apples
2.9
2.1
Cotton, papaya
China Source [9]
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3.2 Features of Digitalization of the Russian Agricultural Sector The attempts to assess the level of digitalization in Russia give quite different indicators. On the one hand, Russia is in 8th place in the world in terms of the number of Internet users with a relatively high relative penetration rate (78%). The.ru domain zone is in 8th place among the world’s domain zones. Russian is considered the second language on the Internet by the volume of content created on it. Yandex Internet search engine is the only example outside East Asia when the national search service wins the competition for market share from the international giant Google for almost 15 years. Almost half (47%) of the Russian population is registered in social networks and actively uses them, 55.9 million people do it from mobile devices [10]. On the other hand, the country has a rather low position in almost all international digitalization ratings: the best results are 22nd in terms of ICT implementation in the WEF global competitiveness index and 29th in the government’s readiness index for the use of Artificial Intelligence. In the digital economy, such Russian companies as Yandex, Mail.ru, Ozon, Rambler have a limited presence on the global Internet, although they have strong positions in the domestic market. By international standards, their market capitalization is low. As of January 25, 2020, Yandex, the leading Russian company, had a market capitalization of $14 billion, the capitalization of the Chinese company Baidu with a similar business model amounted to $45 billion. Russia is losing its position in the global ranking of supercomputers: in November 2010, it occupied 7th place with a share of 2.2%, and in November 2019, it fell to 16th with a share of 0.6% [2]. In 2019, the Ministry of Agriculture of Russia developed a plan for the digital transformation of agriculture [12] as an essential element of the national program “Digital Economy of the Russian Federation.” The government set the goal “to create and implement an intelligent system of management, planning, and use of agricultural land, functioning based on digital, remote, geoinformation technologies and computer modeling methods” [12]. Russia ranks 15th in the world in the digitalization of agriculture, and the market for information and computer technologies in the industry is estimated at 360 billion rubles. According to the Ministry of Agriculture, by 2026, it should grow at least five times. This means that precision farming [PF] technologies will soon be used on every farm [4]. Vast spaces of relatively level sown fields are a natural prerequisite for their implementation. In order to achieve these goals, it is necessary to create an infrastructure and technological base (first of all, a new generation of “smart” agricultural machines, the expanded coverage of fast Internet network), adequate legislation (including in terms of aerial photography), human resources (computer literacy of farmers), the network of integrators (consulting companies). According to the Center for forecasting and monitoring the scientific and technological development of the AIC, in 2017, elements of precision farming were used in 40 Russian regions. By the number of involved farms, the leader is the Lipetsk region, where 812 agricultural producers use the elements of PF (Ministry of Agriculture of Russia, 2019). In general, about 3% of Russian
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agricultural organizations implement PF elements (in the USA—60%, in the EU countries—about 80%) [1]. The material basis is imported equipment, in particular, the machines of the American company “John Deere.” In the production of uncrewed aerial vehicles, Russia is one of the three leaders and can provide PF technology with domestic models. The most significant progress was made in the field of digitalization of document flow and payments using the 1C program, as well as in the implementation of the blocks “Electronic Customs,” “Information Technologies,” “Transport and Logistics.” The scale of activity of online marketplaces—platforms for trading in agricultural products is still not significant. The so-called AgroTech map of the Russian market, created by the Russian company “Rusbase,” together with iDealMachine and Arrotech Skolkovo Ventures, already has its presence in more than 70 companies working in the AIC. The most important of them are Smart Seeds—a platform for ordering and transporting agricultural products, “Electronic farmer”—a platform for ordering and delivering farm products; AgroCargo—“Uber for freight transport” with a focus on the transport of agricultural products; FoodZa—a service that connects farmers with restaurants, offers delivery, and storage [26]. So far, the share of sales of these sites in the total sales of agricultural products does not exceed one percent. The lag of our country in biotechnology development is noticeable. It occupies the 17th place in the world with only 22 patents obtained. While in the USA, there were obtained 9,106 patents. The costs of biotechnology companies for R&D are only 0.53% of all investments of Russian business in R&D [3].
4 Discussion Possible “shocks of the future” [22] are debatable. The main risks of digitalization, according to the author, should include several points. There might be a possible restructuring of the hierarchies of world society in seven population groups: the global elite caste, salariat, qualified personnel (mainly consultants and freelancers), precariat, unemployed, socially disadvantaged [19]. The last three groups will inevitably grow, displaced by robots and IT. In this case, the traditionally excess rural population will suffer more than others. The use of digital technologies in practice primarily affects the sphere of finance and trade. According to the World Bank, labor productivity growth in real sectors tends to decrease [24]. The main subject, purposefully promoting digital and related innovative technologies, is a giant transnational business. Capital concentration and the inevitable monopolization of the markets of technology, services, and goods continue. Thus, 10 TNCs dominate the seed market, accounting for 50% of global sales. They include Monsanto (27% of world production), DuPont (17%) [15]. The monopolization of sales of GMO seeds and the crowding out of traditional seed production leaves farmers with no choice. The long-term consequences of consuming GMO products
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are unclear. However, there is a possibility of a sharp decline in reproductive functions in the third consumer generation and the development of cancer and allergies. Negative environmental impacts are significant. The duality of the effects of the “gene revolution” is reflected in poorly coordinated documents regulating this area of activity. The newly adopted Doctrine of Food Security of the Russian Federation [14] and the need to continue harmonizing international requirements for the quality and safety of food products, notes the need to control genetically modified foods (paragraph 21b). Presidential Decree No. 680 “On the Development of Genetic Technologies” was adopted on November 28, 2018, and a Federal Scientific and Technical Program for the Development of Genetic Technologies for 2019–2027 was adopted in April 2019 [13]. According to the approved program, in the next 3– 6 years, with the help of genetic editing, it is planned to create lines of at least four crops. Simultaneously, transparent procedures and rules for identifying a GM product for the end-user are not spelled out.
5 Conclusion Digitalization, launched by global capital, supported by the governments of different countries and international organizations, is gaining momentum. The most important motivation for this process includes the problem of manageability by complex socioeconomic systems of national, regional, and transnational levels, the exhaustion of the model of intensification of agricultural production, and population growth in the world. There is a need for cost reduction, growth in production volumes, and a change in the matrix of economic and personal life. With regard to agribusiness in the world, the most advanced innovative practices are seen in expanding the distribution channels of agricultural products (in particular in China); robotization and the “new chemicalization” as essential elements of precision farming (the most sophisticated technology where the United States is the undisputed leader), and introduction of biotechnologies (USA, Brazil, Argentina, and China). From the perspective of the components of the Fourth Industrial Revolution, Russia is at the beginning of the road, including in the field of introducing new technologies in the agricultural sector. Until recently, the industry was not included in the list of priorities in the Federal Digital Economy Program. Export orientation of agriculture requires increasing production, including through its digitalization. The country has regions and farms that use elements of precision farming. The full implementation of TK requires serious investment in creating the necessary conditions: IT infrastructure, “smart machines and mechanisms,” education, and the legal environment. Overcoming Russia’s innovation dependence on technology imports is possible if efforts are concentrated in certain areas of scientific and technological progress and stimulate the development and implementation of domestic developments.
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The authors proceed from the fact that digital management in the agro-industrial complex (AIC) is essentially a digital management of food security, territorial development, rural society, and agricultural biocenosis. The technocratic approach to complex socio-economic systems is minimal, especially in agriculture. Agronomics is an increase in the fertility of the land and the reproduction of rural society, which does not always fit into the paradigm of maximizing profits. A substantial gap between technical and social progress is unacceptable.
References 1. Altukhov AI, Dudin MN, Anischenko AN (2019) Global digitalization as an organizational and economic basis for the innovative development of the agricultural sector of the Russian Federation. Market Econ Chall 2:17–27. https://doi.org/10.33051/2500-2325-2019-2-17-27 2. Bahur V (2019) The number of Russian supercomputers in the world Top 500 has grown for the first time in 5 years. https://www.cnews.ru/news/top/2019-11-19_chislo_rossijskih_supe rkompyuterov 3. Basis Genomics Group (2019) The program of development of genetic technologies in 2019–2027. https://basisgenotech.ru/articles/programma-razvitiya-geneticheskikh-tekhno logiy-na-2019-2027-gg/ 4. Chepollina F (2019) A computer on the beds: how “precision farming” will revive the Russian agricultural sector. https://www.forbes.ru/tehnologii/378755-kompyuter-na-gryadkah-kak-toc hnoe-zemledelie-vozrodit-rossiyskiy-agrosektor 5. Christensen KM (2016) Innovator’s dilemma: how powerful companies die because of new technologies, 5th edn. Alpina Publisher, Moscow 6. Eurasian Economic Commission (2016) Program for the development and cooperation in the field of digital economy. Final document. https://www.eurasiancommission.org/ru/act/dmi/ workgroup/materials/Pages/Cifpova%20povectka%20v%20pamkax%20G20/G20_Cot pydniqectvo%20po%20pazviti%20cifpovo%20konomiki_2016%20(pyc.).pdf 7. Goldman Sachs Global Investment Research (2016) The report in the profiles in innovation. Precision farming. Technologies. Cheating Malthus with digital agriculture. https://docdrop. org/static/drop-pdf/GSR_agriculture-N1sH6.pdf 8. Huaten M, Joali M, Yang D, Houaley V (2019) Digital transformation of China. Experience in transforming the national infrastructure of the economy. Alpina, Moscow 9. International Service for the Acquisition of Agri-biotech Applications (n.d.) Official website. https://www.isaaa.org/default.asp 10. Korovkin VV (2019) The agenda of Russian CDOs. https://doi.org/10.2139/ssrn.3396072 11. Xu M (2019) How internet connectivity has changed people’s lives in China. https://news. cgtn.com/news/2019-10-22/How-internet-connectivity-has-changed-people-s-lives-in-ChinaKZR0tk5tra/index.html 12. Ministry of Agriculture of the Russian Federation (2019) Digital Transformation of Russian Agriculture. https://mcx.ru/upload/iblock/28f/28f56de9c3d40234dbdcbfac94787558.pdf 13. Presidential Executive Office (2019) Resolution “On the approval of the Federal Scientific and Technical Program for the Development of Genetic Technologies for 2019–2027” (April 22, 2019 No. 479). Moscow, Russia. https://www.garant.ru/products/ipo/prime/doc/72128722/ 14. Presidential Executive Office (2020) The decree “On approval of the Food Security Doctrine of the Russian Federation” (January 21, 2020 No. 20). Moscow, Russia. https://www.garant. ru/products/ipo/prime/doc/73338425/ 15. Revenko LS (2017) International economic relations: pluralism of opinions in an era of change. MGIMO University, Moscow
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16. Rodovid (2016) ChemChina – a new GMO player from China, now Monsanto’s main competitor. https://rodovid.me/ustoichivoe_razvitie/chemchina_gmo_china_syngenta.html 17. Sosland M (2016) Precision agriculture technologies growing in the US. https://www.foodbu sinessnews.net/articles/8150-precision-agriculture-technologies-growing-in-u-s 18. Spartak AN (2018) Modern transformation processes in international trade and Russia’s interests. Publishing House “IKAR”, Moscow 19. Standing G (2011) The precariat. The new dangerous class. https://www.hse.ru/data/2013/ 01/28/1304836059/Standing.%20The_Precariat__The_New_Dangerous_Class__-Blooms bury_USA(2011).pdf 20. Tadviser.ru (2017) Chemical industry 4.0. https://www.tadviser.ru/index.php/ 21. Tapscott D (1994) Digital economy. McGraw-Hill, New York 22. Toffler E (2002) Shock of the future. AST, Moscow 23. Verified Market Research (2018) Global Agriculture Robots Market Size by Type (Driverless Tractors, Automated Harvesting Machine, Others), By Application (Field Farming, Dairy Management, Indoor Farming, Others) By Geography Scope and Forecast. https://www.verifi edmarketresearch.com/product/global-agriculture-robots-market-size-and-forecast-to-2025/ 24. World Bank (2017) Digital dividends. Overview. World Development Report 25. Zykova S (2019a). Introducing the AgroTech Russian Market Map. https://rb.ru/news/agrotech2019/ 26. Zykova S (2019b) AgroTech: 13 marketplaces that help farmers and consumers. https://rb.ru/ list/agro-marketplaces/
Digitalization as the Key Factor in AIC Development Irina P. Belikova , Olga M. Lisova , Abubakir H. Tambiev , Inna A. Semko , and Larisa A. Altukhova
Abstract Currently, the pace of digitalization of the economy is growing. Despite the progress of many high-tech sectors of the economy over the past few decades, the welfare of the population is still determined by the development of agriculture. Moreover, in the foreseeable future, the importance of this sector of the economy will only grow steadily due to an increase in the population, urbanization processes, a reduction in the size of cultivated land, environmental pollution, and several other reasons that accompany evolutionary changes. Therefore, the production of products and meeting the needs of the population in food products with high quality are invariably among the strategic tasks of national importance. The innovative nature of advanced agricultural technologies, including the active use of information technologies as basic elements, led to the digital transformation of the agro-industrial complex [AIC]. The review of successful practices of introducing modern information technologies into the organization and management of agricultural production confirms that ensuring an acceptable degree of efficiency is achieved through the adoption of system management decisions, taking into account the mutual conditionality, specificity of the applied information technologies, and various software and hardware systems. Keywords Agro-industrial complex · Agriculture · Digitalization · Digital economy · Digital technology · Modernization · Innovation
I. P. Belikova (B) · O. M. Lisova · I. A. Semko · L. A. Altukhova Stavropol State Agrarian University, Stavropol, Russia A. H. Tambiev Uchkeken Branch of the Southern Federal University, Uchkeken, Russia e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_26
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1 Introduction The world entered an era of digital globalization, defined by data streams containing information, ideas, and innovations. For Russian agribusiness, digital technologies are new and not widespread. The current digitalization level causes serious concern due to the lack of scientific and practical knowledge on modern agricultural technologies, the lack of the proper amount of technical means and equipment, and the foreign origin of the used digital services. Nowadays, only a small number of agribusiness entities have the necessary financial capabilities to purchase new equipment, technologies using IT equipment, and various platforms. The solution to these problems is essential for improving the economic efficiency of Russian agribusiness and the transition to a digital economy, which determined the relevance of the study. Following the Strategy for the Development of the Information Society in Russia, the activity “in which the key factors of production are the data presented in digital form, their processing, and use in large volumes … can significantly increase efficiency, quality, and productivity compared to traditional forms of management in various types of production…”, (“Digital Economy Russia” ANO, n.d.) characterizes the digital economy. The purpose of the digitalization of the agro-industrial complex [AIC] is to increase productivity and efficiency due to the introduction of modern digital technologies and business interest in the development of IT solutions for the agricultural industry. Developed countries are successfully modernizing their economies at an accelerated pace, developing innovative technologies using AI, automation, and digital platforms. Nowadays, global spending on R&D is about $2 trillion, with an average annual growth of 4.0%. The transfer of valuable flows of information and data provides the ability to move all kinds of goods, services, and finances. Almost any kind of cross-border transaction already has its digital component. Over the next five years, it is projected to increase information flows tens of times, including various search queries, data, video, and internal traffic. Nowadays, the digital form of globalization creates opportunities for developing countries, small companies, start-ups, and billions of people. Tens of millions of small and medium-sized enterprises worldwide became exporters, joining the bases of ecommerce. All types of global flows support growth through increased productivity. Data flows help create more efficient markets. Digital technologies in the AIC are the primary way to strengthen the economy, as well as its reloading from the raw material model to the industrial-service model using smart agricultural technologies, which are provided thanks to AI, neural networks, digital platforms, 3D printing, robotics, biosensors, and Big Data.
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2 Materials and Methods The research methodological basis was economic-statistical, abstract-logical methods, comparative analysis, and systemic and institutional approaches. To achieve the research goal, we studied the statistical and analytical reports, forecasts contained in various literary sources, and Internet resources of the state and public organizations. The theoretical and informational basis was the work of domestic and foreign scholars dealing with the problems of labor economics, the digital economy, innovative development, effective functioning of various sectors of the AIC, public administration, and various regulatory legal acts of legislative and executive authorities.
3 Results and Discussion With the advent and spread of the latest technologies, the use of considerable arrays of data, the future of the economy is increasingly determined by the opportunities and limitations of digital development. Significant and continuously increasing virtualization of the entire sphere of economic activity in the economy causes noticeable structural changes and new values and categories. The digital transformation of the economy is a natural process since it manifests systemic evolutionary changes. In practice, transformation is reflected in a change in the values of the economic system, which affect the authority of states and their importance in the international arena. For example, two centuries ago, such values were the size of the territory of the state, and one century ago—developed industry and natural resources. Nowadays, the primary value is knowledge and information, which are reflected in the volume of innovations that contribute to improving the quality of life. Innovations in information computer technology give the development a positive character and make it sustainable. In the global economy, there is a tendency to widen the gap between those companies that use digital technologies and those that develop and distribute them, defining and, to some extent, “imposing” performance standards. Typically, the latter is located in advanced economies (Germany, Japan, Sweden, the United States, and China). By focusing on the benefits of the first order and not paying attention to the decisive importance of the development of technologies and their management, many countries are giving up the possibility of using the advantages of the second order. Emerging market economies should strive for second-order benefits. For example, policies aimed at expanding participation in e-commerce and digital technologies can increase the long-term competitiveness of the country only if there is a clear understanding that additional efforts on the part of the state will be required to push the economy towards independent development and management of digital
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technologies. Therefore, various digital initiatives need to be combined into a single national strategy to prepare the economy of the country for a gradual transition from the introduction and use of such technologies to the direct development and further management of them. These will be second-order advantages. Consequently, the previous “Strategy for the Development of Science and Innovations in the Russian Federation for the period until 2015” is disappointing. The results cause considerable and fair criticism from the scientific community. Currently, the digital economy is just beginning to develop and gain momentum in Russia. “Digital technologies are becoming an everyday part of economic, political, and cultural life of Russian economic entities and the engine of development of society” [10]. Moreover, some digital technologies are already successfully operating in Russia (electronic databases, electronic document management, digital media, electronic signatures, mobile banking systems, public access to public services and social services through electronic platforms, and many more). According to studies of international agencies, Russia saw a steady increase in the use of new information and communication technologies in the business environment and everyday life (Fig. 1). Many experts conclude that the digitalization of the Russian economy is still not significant compared with foreign countries. For example, the share of the digital economy in the GDP of developed countries from 2010–2016 increased from 4.3 to 5.5%, while the GDP of developing countries from 3.6 to 4.9%. In the G20 countries, over five years, this indicator grew from 4.1 to 5.3%. The UK is the world leader with the largest share of the digital economy in GDP (12.4%) [2]. According to BCG, the share of the digital economy in Russia in the gross domestic product is only 2.8%, or $75 billion. According to specialists, Russia is generally 5–8 years behind the leading countries in the development and implementation of digital technologies. Therefore, if the growth rate of digital technologies in Russia will continue to be at the same level as today, then by 2021, due to the high speed of the ongoing global changes and the introduction of innovations, this gap will already be in 10–15 years [11].
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Thus, the digital economy is the main priority in the Strategy of scientific and technological development of the Russian Federation. V. V. Putin, the president of Russia, said that: “…The digital economy is not a separate industry; in fact, it is a way of life, a new basis for the development of public administration, the economy, business, and the social sphere, the whole society… The formation of a digital economy is a matter of national security and independence of Russia, the competition of domestic companies…” [8]. The government of the Russian Federation constantly controls the development of the Russian agricultural sector. It was indicated as one of the national priorities for 10–15 years [7]. When setting the goals and objectives of the digital transformation of the Russian AIC, it is necessary to understand that the transition to the digital economy as a whole and in individual industries is carried out in two main directions: – The appearance and introduction of new goods and services in the form of information software products, technological equipment (software), and new products and services in e-form. – The modification of existing products, services, technologies, configurations of the organization of production and business, the improvement (change) of approaches to managing agribusiness, and other socio-economic systems at different levels. The digitalization processes of the agrarian sector determine the synchronization of information flows and reduce transaction costs. Modern agribusiness should be “smart,” which means not only focusing on demand and preferences of consumers of goods and services but also reducing costs and increasing efficiency through the introduction of digital technologies (satellite imagery, diversified cultivation algorithms, high-tech sensors, drones, innovative mobile applications, GPS systems, etc.). The market for information technology in the agricultural sector is rapidly developing. The volume and quality of modern systems for collecting, storing, and processing data are growing. According to the All-Russian Agricultural Census 2016, 47.6% of agricultural organizations had access to the Internet, compared to 9.5% in 2006. That is, over ten years, Internet coverage of agricultural organizations increased five times. However, there remains unevenness by category of holdings. In 2016, the Internet was available to 17.9% of peasant (farmer) enterprises and individual entrepreneurs and 20.2% of households [5]. The Russian government will likely aim to increase the market share of digital technologies in the AIC. Currently, funding for the information technology and digital component of agricultural production in Russia is about 360 billion rubles. By 2026, according to the plans of the Ministry of Agriculture of the Russian Federation, this figure should increase more than five times. As a positive fact, it should be noted that several agricultural entities are actively introducing digital technologies in Russia. Thus, in particular, the Kuban agricultural firm “Agronout,” in 2017, developed and tested technology for fertilizer application that takes into account the real state of the soil. The estimated economic effect of its use is 50 million rubles per year.
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The use of innovative digital technologies should be the main factor in the growth of production and an increase in profits in the agricultural sector. According to the Federal State Statistics Service and the Ministry of Agriculture of Russia, the use of digital technologies is marked with the data presented in Fig. 2 and 3. Nowadays, only 10% of Russian arable land is cultivated using digital technology, while about 40% of the crop is lost due to the unused innovative technologies. In terms of the agricultural digitalization, Russia ranks 15th in the world [3]. Currently, the opportunities for the modernization of the AIC are enormous. In all countries, agriculture is turning from a traditional to a high-tech industry, which can create new markets for multiple innovative developments to solve a significant number of practical problems successfully. The introduction of digitalization in the agricultural sector will reduce risks, better adapt to climate change, and increase crop yields. Reducing the cost of agricultural production and improving its quality and competitiveness due to the more
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efficient use of various resources and science-based approaches are the main tasks of digitalization. Presently, working without digitalization means losing the global competition. Therefore, it is necessary to forecast offers for agricultural products depending on market demand and consumer preferences to remain competitive. Therefore, to make the right managerial decision, agricultural producers must possess such digital technologies as satellite images, high-tech sensors, mobile applications, and GPS systems. The problem of the storage and processing of agricultural products in Russian regions is being solved. The construction of five wholesale distribution centers with a total area of more than 260,000 square meters has already begun. The former wholesale distribution centers were focused mainly on retail and wholesale trade. Analysts say it is the time for new and technological alternatives. The active construction of modern agricultural parks in the regional centers is expected to start within the next five years. These centers will include warehouse terminals with multi-temperature chambers for storing fruits and vegetables, cross-docks, and equipped wholesale warehouses. Russian agribusiness has great potential for increasing production by introducing digital technologies in crop and livestock production, increasing labor productivity, and the full use of digital platforms for management at the macro and micro levels. A high-quality exchange of accessible and reliable information is needed from production to the promotion of products on the market [4, 9]. Constraining factors for digitalization of agribusiness include: – The existing agricultural structure with numerous small forms of management (more than 99%), which produce 44.9% of all agricultural products, mainly for own consumption, as of 2018. They are marked with a lack of financial resources due to which modern means of mechanization and automation are not available, and low production efficiency and labor productivity are observed. In turn, agricultural organizations have a high level of debt (in 2017, the total debt on bank loans and loans amounted to 1.4 trillion rubles), which does not allow one to finance the implementation of modern technologies fully; – The presence of a significant number of empty agricultural land (in 2017, the area of agricultural land amounted to 222 million hectares (13% of the total area), and the sown area of crops amounted to only 80 million hectares, (36% of the area of agricultural land)) [6], which allow increasing production volumes due to the development of new lands instead of the introduction of new technologies to improve their use; – Low level of material and technical equipment, especially in peasant farms and households (the provision of agricultural organizations with tractors per 1,000 hectares of arable land amounted to 3 units in 2018). The use of obsolete equipment, insufficient number per unit of cultivated area, and the lack of service centers make it impossible to include it in the digitalization process, particularly for IT projects;
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– A long chain of promotion of agricultural products, including producer, processing enterprises, wholesale and retail companies, and the underdeveloped logistics, storage, and delivery systems. The low level of communication between the links of the chain leads to high transaction costs and difficulties in selling products. Consequently, agricultural enterprises need to produce more food products with the least resources. Therefore, a significant breakthrough in agricultural production technologies is a necessity. If we continue to use old methods and work by eye without digitalizing agriculture, we will lose the global competition.
4 Conclusion For a long time, agriculture was not attractive to investors due to the extended production cycles, natural risks, high crop losses during the cultivation, the collection and storage of products, and the lack of automation of biological processes, absence of progress in increasing labor productivity, and lack of innovation. The introduction and application of information computer technology in the AIC was limited only to the use of computers and software for financial management and tracking commercial transactions. Quite recently, agribusiness began to use digital technologies to monitor crops, livestock, and various elements of the agricultural process. The technology evolved and made a breakthrough jump, which attracted attention to the industry. Currently, technological organizations concentrated their interest on the AIC, which, together with partners, mastered the control of the full cycle of plant growing and animal husbandry by using smart devices that can transmit and process the current parameters of soil, plants, microclimate, animal characteristics, etc. They also introduced seamless communication channels inside the organization and with external partners. It is now possible to automate the maximum number of agricultural processes due to combining objects into a single network, exchanging and managing digital data based on the Internet of Things, increased computer productivity, and the use of software products and new cloud platforms. Additionally, the processes are automized by using a digital model of the full production cycle and interconnected parts of the value chain. It allows us to plan work schedules, make decisions, take emergency measures to prevent risks and losses in cases of recorded threats, and calculate the probable productivity, production costs, and profitability in advance. Thus, digitalization is becoming the primary tool in developing priority areas for the regulation of the AIC, including affordable financing for agribusiness entities, access to markets, and export development. The use of digital technologies in the agricultural sector can increase competitiveness and labor productivity and ensure quality and safety, coupled with attracting investment in the industry.
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References 1. “Digital Economy Russia” ANO (n.d.) Official website. https://data-economy.ru/organization 2. Akhmetshina LG (2019) Digitalization of Russian agribusiness: the possibility of implementing IT projects. Econ Labor Manag Agric 8(53):116–120 3. Bauer VP, Podvoisky GL, Kotova NE (2018) Strategies for adapting US companies to digitalize manufacturing. The world of the new economy, vol 2. https://wne.fa.ru/jour 4. Belikova IP, Sahnyuk TI, Sahnyuk PA, Korshikova MV, Svistunova IG (2016) Methodological provision of active management of economic risk in agrarian business. Eur Res Stud 9(2):113– 124 5. Federal State Statistics Service (n.d.) Official website. https://gks.ru 6. Kuban State Agrarian University (2019) Monitoring and forecasting in the field of digital agriculture in 2018. https://foresight.kubsau.ru/ 7. Presidential Executive Office (2018) The Decree of the President of the Russian Federation for the period until 2024, Moscow, Russia, 7 May 2018 8. Russian Agricultural Academy (2007) The concept of the development of agricultural science and scientific support for the agricultural sector of the Russian Federation until 2025, Moscow, Russia 9. Tenishchev A, Mysova OS, Dovlatyan GP, Belikova IP, Troyanskaya M (2016) System approach to business administration innovation-oriented enterprises. Eur Res Stud 9(2):302–309 10. Ustinovich ES, Kulikov MV, Vorobyov YuN (2019) Digitalization of agriculture: Russian and foreign experience. Econ Agric Process Enterp 9:48–52 11. Vartanova ML, Drobot EV (2018) Prospects for the digitalization of agriculture as a priority area of import substitution. Econ Relat 8(1):1–18
Priority Areas for Sustainable Agricultural Development: Regional Aspects Raisa I. Safiullaeva , Tatiana A. Neshchadimova , Irina A. Demchenko, Olga I. Solovieva , and Sergey V. Zolotarev
Abstract The paper is devoted to the problems of sustainable agricultural development in the Stavropol Krai. The most important socio-economic task of any state is to ensure food security. Under the conditions of foreign economic sanctions, the Russian food embargo, the development of domestic agriculture and rural territories became an imperative of the economic policy of the country. The relevance of this topic is confirmed by the fact that it touches on some of the most “painful” issues in the industry, including the depressive state of certain areas of the agricultural sector, poverty, and the deficient standard of living in the countryside, contributing to the extinction of villages, the deterioration of the environmental situation, etc. The purpose of the study is to develop theoretical and methodological provisions on the substantiation of priority areas for sustainable development of agricultural production in the Stavropol Krai. During the study, we used a systematic approach to the studied objects and processes and methods of general scientific research. During the study, the main trends in the development of the agro-industrial complex [AIC] of the region and the existing problems were identified. The principles of sustainable agricultural development are considered in the synthesis of economic, social, and environmental development. The analysis and conclusions formed the basis of the identified priority areas for agricultural development in the Stavropol Krai. Keywords Sustainable development · Agriculture · Rural territories · Priority areas · Stavropol Krai · Agricultural production
R. I. Safiullaeva · T. A. Neshchadimova · I. A. Demchenko Stavropol State Agrarian University, Stavropol, Russia O. I. Solovieva · S. V. Zolotarev (B) Russian State Agrarian University, Moscow Timiryazev Agricultural Academy, Moscow, Russia e-mail: [email protected] O. I. Solovieva e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_27
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1 Introduction In the global context of sustainable development, agriculture plays a leading role. The agro-industrial sector is the largest employer globally, employing about 1 billion people of the economically active population. Agriculture is critical to global food security and vulnerable to climate change. The agro-industrial and food industries occupy an important place in the global economy, having special significance for developing countries. That is why investment in agriculture has one of the best effects, contributing to economic growth, providing the population with necessary products, and combating poverty [2]. The main objective of agriculture is to produce food products at a level that will ensure food security, meet growing demand, and adhere to the principles of sustainable development. Within the agricultural sector, this means that basic resources (such as soil, nutrients, and water) cannot be used indiscriminately. Therefore, decisions aimed at sustainable development of agricultural production should focus on improving the use of available resources. World food production should increase by about 70% in the next generation. To achieve this indicator, we need to use the same area of agricultural land and less water. Climate change, energy issues, and soil degradation make the task even harder. Therefore, to ensure the sustainable development of agriculture and partially solve the problem, we should consider economic, social, and environmental sustainability issues in their close relationship.
2 Materials and Methods The research is based on the works of domestic and foreign scientists on the problems of sustainable development of agriculture, regulatory and legal acts of the Russian Federation and the Stavropol Krai, and state programs of agricultural support [1, 4, 10]. The research was also based on the data of the Federal State Statistics Service, statistical and accounting reports of organizations of the Stavropol Krai, domestic and foreign publications, and materials of conferences and seminars on the studied issues. During the research, general scientific methods of analysis, synthesis, induction, deduction, grouping, generalization, detailing, analogy, graphic, comparison, historical, and systemic approaches were used.
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3 Results According to the generally accepted approach to sustainable development in agriculture, it should be considered in three main dimensions: economic, social, and environmental. The economic dimension includes ensuring food security, increasing agricultural production, organizing profitable production, and increasing its efficiency. Under sustainable agricultural development, producers should receive sufficient financial remuneration to improve the material and technical base, introduce innovations in economic activities that contribute to more efficient crop production, increase animal productivity, and preserve the environment [3, 5]. In recent years, the country was actively developing the agricultural sector. Real production growth was achieved in several agribusiness sectors. The driver of the agricultural industry development was introducing pro-embargo and an active course on import substitution in the main food items (meat, vegetables, fruits, and dairy products) in 2014. The effectiveness of the agricultural sector development largely depends on the interaction of business and the state. On the one hand, the total amount of financing the industry from the federal budget in various directions, according to the state program for the development of agriculture, from 2013 to 2025, will amount to 3.54 trillion rubles. This is mainly supported in the form of subsidies and benefits. Another support mechanism is market protection, including duties on imported products, the fight against counterfeit goods, and public procurement mechanisms. Stavropol Krai is one of the most favorable regions of the country for the organization of agricultural production. To assess the current level of agricultural development in the region, we consider the dynamics of the main industry indicators Table 1. For the analyzed period, the area of agricultural land in the region remained virtually unchanged and amounted to 5,651.9 thousand hectares in 2018. Over the same period, the sown area expanded by 4.4%. In terms of agricultural output, in 2018, the Stavropol Krai, among the regions of the North-Caucasian Federal District, takes the first place. It occupies the third place in the South of Russia after the Krasnodar Krai and the Rostov Region. In crop production, production growth was 29.5% and 24% in livestock production. The largest share in agricultural production is occupied by agricultural organizations—67.3%, 19.2% falls on households, and 13.5%—on peasant (farmer) enterprises. Over the past eight years, investments in fixed assets of the Stavropol Krai significantly increased from 88.6 in 2010 to 158.2 billion rubles in 2018 (78.5%). At the same time, the largest share in the investment structure of the region falls on agriculture and accounts for 20%. It should be noted that this indicator in the whole of the Russian Federation is only 4.4%. According to the results of monitoring the renewal of the fleet of agricultural machinery, the Stavropol Krai became one of the three leaders along with the Altai and Krasnodar Krais. According to operational data from the Ministry of Agriculture of Russia, in the framework of the federal program in 2019, the purchase of 24
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Table 1 Key indicators of agriculture in the Stavropol Krai Indicators
2014
1 Agricultural 5,657.3 land, thousand ha, including
2015
2016
2017
2018
2018 in % to 2014
5,657.1
5,657.0
5,652.3
5,651.9
99.9
99.9
arable land, thousand ha, of which
3,932.3
3,932.1
3,931.9
3,928.8
3,928.3
sown area, thousand ha
3,009
3,041
3,097
3,110
3,139
104.4
2 The number of people employed in agriculture, thousand people
213.0
216.6
213.1
197.8
194.7
91.4
3 Crops produced by farms of all categories, million rubles
101,842.0
131,807.0
148,836.0
129,608.0
131,862.0
129.5
4 Livestock products produced by farms of all categories, million rubles
47,159.0
56,749.0
58,246.0
57,282.1
58,480.3
124.0
5 Indices of agricultural production in % of the previous year
106.4
103.6
110.0
99.0
92.7
–
Source Compiled by the authors
thousand units of agricultural equipment was subsidized throughout the country, which is a third more than in 2017. In 2019, the volume of budget funds for these purposes was increased by 6.5 billion rubles, amounting to 14 billion rubles. Along with the positive trends in the agricultural sector of the region, several factors have a negative impact on the construction of a sustainable agricultural development system. One of such factors is the constant reduction in the number of people employed in the AIC of the Stavropol Krai. In 2018, this indicator amounted to 194.7 thousand people, i.e., only 15.5% of the total number of people employed in the region’s economy. One of the leading indicators characterizing the efficiency of agricultural production is profitability [6]. However, according to the data presented in Fig. 1, most of the main types of agricultural products in the Stavropol Krai are either low-cost or
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Fig. 1 Profitability (loss-making) of agricultural products of the Stavropol Krai Source Compiled by the authors
even lie in the “negative” plane. This is especially true of the livestock industry, in which, throughout the analyzed period, the production of wool, cattle, sheep, and goats in live weight is unprofitable. The social dimension includes increasing the real income of the population, improving conditions and living standards in rural areas, and ensuring employment. Sustainable development of agriculture in the region can be achieved only in close connection with the social well-being of rural areas, which, in Russia, are experiencing a deep crisis. A significant lag in living standards from cities, the lack of necessary infrastructure, and unemployment contribute to a significant outflow of young people from rural areas. In the Stavropol Krai, during the subprogram “Sustainable Development of Rural Territories” of the state program of the Stavropol Krai “Development of Agriculture,” there was noticed a positive growth trend in the main socio-economic indicators Table 2. Thus, despite the continued reduction in the rural population of the region (by 1.4% for the analyzed period), there is a significant increase in the average monthly nominal accrued wages in agriculture, the growth rate of which is ahead of the growth rate of wages in the whole economy of the region (152.1% against 128.6%). In 2016 and 2017, wages for the type of activity “agriculture, hunting, and forestry” were even higher than the average for the economy. The rate of unemployment is also reduced. In 2018, its level amounted to 5%, i.e., it decreased by 27.5% compared with 2014. The state program on sustainable rural development was successfully implemented in the Stavropol Krai since 2014. Over the entire period of its implementation, more than 1.7 billion rubles were spent. Under the program, 746 families received affordable housing, more than 65% of them are young families. More than 50 km of
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Table 2 Socio-economic indicators of the Stavropol Krai 2014
2015
2016
2017
2018
1 Total population, thousand people
Indicators
2,799.5
2,801.6
2,804.4
2,800.7
2,795.2
99.8
2 Including: Urban population rural population
1,627.5 1,172.0
1,632.1 1,169.5
1,636.8 1,167.6
1,636.9 1,163.8
1,639.3 1,155.9
100.7 98.6
41.7
41.6
41.5
41.4
3 The share of the 41.9 rural population in the total population of the region, %
2018 in % ti 2014
98.8
4 Average monthly nominal accrued wages: In the whole economy, rubles
22,597.0 23,245.0 24,655.0 26,645.0 29,065.0 128.6
agriculture, hunting, and forestry, rub
18,310.0 21,416.0 24,793.0 27,113.0 27,858.0 152.1
5 Unemployment rate, %
6.9
5.6
5.7
5.2
5.0
72.5
Source Compiled by the authors
gas supply networks and 137 km of water arteries were commissioned. Moreover, 24 new sports grounds were built. A new school was built in the Predgorny district, and two roads were laid in the Trunovsky and Stepnovsky districts. Agriculture contributes to the prosperity and vitality of the rural population, its economic and social development, with a separate topic being the environment protection, the production of organic food, and providing the population with healthy food. The environmental dimension of sustainable agricultural development involves environmental protection, rational use of natural resources, and measures to replenish depleted resources. However, agricultural production negatively affects the environment [7]. Nowadays, agriculture is one of the primary sources of greenhouse gas emissions. Therefore, reducing carbon dioxide emissions in this sector or even turning it into a carbon sink can contribute to solving this problem. The unreasonable expansion of farmland associated with the loss of biodiversity is the key moment in the process of growing greenhouse gas emissions caused by agriculture and generated by a change in land use. Greenhouse gas emissions also accompany the production process of mineral fertilizers. For the study period, the emissions of air pollutants in the Stavropol Krai increased from 78.9 thousand tons in 2014 to 94.7 thousand tons in 2018. The content of the most important organic substance—humus in the soils of the region saw a significant decrease (from 2.13% to 2%). Other factors that negatively affect the quality of agricultural land resources include water and wind erosion of soils, low potassium
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and phosphorus levels, soil salinization, waterlogging, desertification, and a general decrease in arable land quality to 48 points. In this regard, the development of organic agriculture in the region is of paramount importance. Its main goal is the health of soils, ecosystems, and people. In organic agriculture, in addition to pesticides, the use of antibiotics, GMOs, growth hormones, and chemical food additives is prohibited. As a result, the environment is being improved, soil fertility is being restored, biodiversity is increasing, and bees are being preserved.
4 Discussion Despite the positive changes outlined in the AIC of the Stavropol Krai over the past five years, there are still several unresolved problems and questions. Based on the results obtained during the study, we consider it necessary to identify priority areas for sustainable agricultural development in the region Fig. 2.
Priority areas for sustainable development of agriculture in the region
Improving land relations and increasing the efficiency of land use Institutional transformations in agribusiness Development and implementations of innovations in the main areas of development of the AIC of the region Improving the system of training specialists and scientific personnel for the agricultural sector Development, popularization, and increase in the share of organic agricultural production in the agricultural sector of the region Improving the efficiency of agricultural production while reducing environmental impact Monitoring the efficient use of budget funds in the framework of existing state programs
Sustainable agriculture in the region
Fig. 2 Priority areas for sustainable agricultural development in the Stavropol Krai Source Developed by the authors
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The efficient use of land resources is one of the main factors of sustainable agricultural production. In the current conditions of the functioning of the AIC, there is an urgent need to improve land legislation aimed at protecting property rights and land use, protecting valuable agricultural land from their use in other areas, and unjustified development. The first step in this direction may be creating an agency for the protection and use of agricultural land resources as part of the Ministry of Agriculture of the Russian Federation. Another priority area is the institutional transformation of the AIC, which should be based on the cooperation of small and medium-sized producers of agricultural products, which will become an alternative to large agricultural holdings that have considerable land areas at their disposal, which may have negative socio-economic consequences. Achieving sustainable agricultural development is not possible without innovation. Innovation in the agricultural sector makes it possible to bring the industry to a different, higher level of development [8]. The creation of hybrid varieties, the use of new tools for tillage, innovative approaches to sowing seeds, automation and mechanization, the use of new equipment and machines, the development of modern drugs to protect plants from harmful insects and diseases, the improvement of irrigation technology, and the introduction of fertilizers are the main tasks requiring solutions in this direction. To increase the efficiency of the AIC, the agricultural development program also provides subsidies to scientific organizations and educational institutions. Currently, the education system must be continuously transformed to meet the needs of the market. Thus, agricultural universities need to change and introduce new specialties that would allow graduates to be in demand in the labor market. The leading companies in the agricultural sector of Russia are ahead of agricultural universities in technological and scientific level, forcing educational institutions to switch to a new standard of education. Unfortunately, domestic universities do not graduate geneticists, specialists in sustainable agriculture and agricultural product quality control, biotechnologists, and researchers in various scientific fields. This state of affairs makes the improvement of the system of training specialists and scientific personnel for the agricultural sector one of the main priorities. No less significant are the problems of developing and increasing the share of organic agriculture in the agricultural sector of the region and minimizing the environmental impact [9]. A significant impetus for their decision may be the implementation of the federal law dated “On Organic Products and on Amending Certain Legislative Acts of the Russian Federation” (August 3, 2018 No. 280-FZ), which entered into force on January 1, 2020. The main activities aimed at greening agriculture in the Stavropol Krai should include scientifically based crop rotation of an ecological orientation, taking into account the specialization of agricultural enterprises and maximally adapted to certain soil and climatic conditions; systems for selecting the optimal combinations and doses of mineral and organic fertilizers , taking into account the characteristics
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of crop growth in specific conditions and the possibility of increasing crop yields and the quality of products while reducing material costs per unit of production and unit of area.
5 Conclusion Summarizing all the above, it should be concluded that the sustainable development of agriculture in the region is ensured by the balanced well-being of the economic, social, and environmental conditions. However, the problems of the region identified during the study do not allow us to consider the development of agriculture and rural territories of the Stavropol Krai sustainable. The interaction of business and government in the region is now in the vein of simultaneous financing of various priority projects. However, if we assume that the role of the state, on the contrary, is reduced to decreasing administrative obstacles in regulating or lowering tariffs for services of monopolistic structures (water supply, electricity, and heating), then state support in such volumes is not required. The problem of a lack of qualified personnel is being gradually solved, albeit at a slow pace. It has already become evident at all levels that high-quality professional education is unthinkable without superior experience, both of leading Russian companies and international experts. Priorities in the field of state regulation of the socio-economic development of rural territories of the Stavropol Krai should be formed, taking into account the establishment of restrictions on the anthropogenic impact of agricultural production on the environment and ensuring a decent standard and quality of life for the population. The priority directions of sustainable development of agriculture in the Stavropol Krai will help to develop a set of specific measures in the context of each direction, the implementation of which will solve the identified problems.
References 1. Frolov AV, Frolova AA (2014) The analysis of the effectiveness of functioning and staticdynamic evaluation of effective agricultural organizations of the Stavropol Krai. Econ Entrepreneurship 12–3(53–3):653–657 2. Gerasimov AN, Gromov YI, Pshenichniy PP (2015) Quantification of the economic management system of a microregion. Actual Prob Econ 169(7):420–429 3. Glotova II, Tomilina EP, Agarkova LV, Klishina YE, Uglitskikh ON (2019) The development of a scoring model for determining the probability of a delay in lease payments by the lessee. Int J Sci Technol Res 8(9):1995–2003 4. Khoruzhy LI, Karzaeva NN, Katkov YuN, Tryastsina NY, Ukolova AV (2018) Identification and presentation of information on sustainable development in the accounting and analytical systems of the organization. Int J Civil Eng Technol 9(10):1575–1581
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5. Kontsevaya SR, Khoruziy LI, Kharcheva IV, Makunina IV, Kostina RV (2015) Taking the managerial decisions at the enterprise in the age of agriculture globalization in Russian Federation. In: Proceedings of the international scientific conference “Agrarian perspectives XXIV – global agribusiness and rural economy”, pp 216–223. Czech University of Life Sciences, Prague 6. Kostyukova EI, Yakovenko VS, Germanova VS, Frolov AV, Grishanova SV (2017) Evaluation of the company’s financial condition from the position of different groups of stakeholders. Espacios 38(33):11 7. Kulish NV, Sytnik OE, Tunin SA, Frolov AV, Germanova VS (2018) Approaches to the valuation of biological assets at fair value. Res J Pharm Biol Chem Sci 9(3):746–750 8. Titova OV, Kostyukova EI, Boboshko NM, Drachena IP (2019) New types of taxes and forms of taxation in the conditions of information economy: perspectives of optimization. Stud Syst Decis Control 182:229–235 9. Trukhachev VI, Sklyarov IY, Sklyarova YM, Gorlov SM, Volkogonova AV (2018) Monitoring of efficiency of Russian agricultural enterprises functioning and reserves for their sustainable development. Montenegrin J Econ 14(3):95–108 10. Usenko LN, Usenko AM, Uryadova TN, Bashkatova TA, Beliaeva SV (2017) Monitoring methodology for the socio-economic development of a region (through the example of the South of Russia regions). Espacios 38(23):24
Assessment of the Influence of Spatial Effects on the Efficiency of Agriculture in European Countries and Russia Stanislava R. Kontsevaya , Aleksander I. Metlyahin , Elena I. Kostyukova , Irina V. Makunina , and Daria D. Postnikova
Abstract Economic globalization plays an essential role in the modern world and has a significant impact on agricultural productivity within individual countries. The countries’ economies mutually influence each other, and it is crucial to assess this influence (country effect). The research objective is to assess the return on one hectare of agricultural land in different European countries and the impact of spatial effects. The research was based on the data of 35 European countries for 2002– 2015 taken from the FAO database at comparable prices of 2010. For the analysis, a spatial panel regression model with fixed effects was used. In total, 11 factors of production influencing the efficiency of agriculture were selected, grouped into three subgroups—labor, land, and capital. To determine the weight matrix, the “four nearest neighbors” methodology was used. Based on the research results, we concluded that European countries are subject to spatial dependence; spatial effects are significant for agricultural productivity; there are positive spatial effects from an increase in population density and the share of people employed in agriculture in neighboring countries. Keywords Regional analysis · Agricultural efficiency · Spatial panel regression
1 Introduction At the present stage of the world economic development, almost every country is forced to integrate into the system of international economic relations to provide
S. R. Kontsevaya (B) · I. V. Makunina · D. D. Postnikova Russian State Agrarian University, Moscow Timiryazev Agricultural Academy, Moscow, Russia A. I. Metlyahin Vologda State University, Vologda, Russia E. I. Kostyukova Stavropol State Agrarian University, Stavropol, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_28
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incentives for the development of domestic economic activities and to meet the evergrowing needs of citizens. At the same time, the most significant successes are shown by those countries that take an active part in the international division of labor. The increasing degree of globalization of the economy leads to the mutual penetration of technologies. It has a significant impact on the productivity of activities within individual countries, in connection with which there is a need for a quantitative assessment of spatial effects in changing the productivity of using certain factors of production. Most noticeably, these effects should be shown within the framework of interstate economic unions. However, such effects can also be observed within a single country. Kelejian and Piras [8], in their study on the spatial model of cigarette demand, indicated that buyers could cross country borders to find better cigarettes to purchase. Demidova [3] examines the regions of Russia and their influence on each other. The research objective is to assess the return in monetary terms from 1 ha of agricultural land in different European countries and to check the spatial effects. The hypothesis is that the presence of positive spatial effects affecting the efficiency of agricultural land in Europe.
2 Materials and Methods The base of the study includes European countries. These are all the countries of the EU, Ukraine, Albania, Russia, etc. We selected data for 14 years (2002–2015) of 35 countries. “Problem countries” with incorrect data or no data on agriculture (Belarus, Vatican, San Marino, etc.) were removed. The source of the statistics is the Food and Agricultural Organization of the United Nations (FAOSTAT). We grouped the independent variables into three large groups by factors of production—labor, land, and capital (Table 1). The dependent resulting variable y is the efficiency of land use ($) per 1 ha of agricultural land. The value added per worker in agriculture and the number of workers employed in agriculture per 1 ha should have a positive relationship with agricultural land productivity since they characterize the intensity of the use of land resources. The share of agricultural workers in the total employed and the total population density should be negative because, in the case of the share of agricultural workers, the law of decreasing marginal return from the use of resources is manifested. In the case of population density, we can talk about alternative ways of using land (more efficient than agriculture). We used spatial panel regression with fixed effects and three types of weight matrices. • Inverse Distance Weight Matrix; • Weights matrix based on Gabriel “neighborhood”; • Weight matrix for four nearest neighbors.
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Table 1 Initial variables for the model Independent variables for factors of production: Labor
Land
Capital
Value added per worker in agriculture, $ (vapw); Share of agricultural workers in total employment, % of total employment (empl); General population density, people for one sq. km (dnst); Employed in agriculture, workers per hectare (emplha)
Dummy variable for EU membership (EUmemb); The amount of application of nitrogen fertilizers kg per 1 hectare (frt); Ln (area) of agricultural land, thousand hectares (lnagrlnd); The percentage ratio of livestock production in total agricultural production,% (lvs)
Increase in fixed capital, % (cptl); Foreign direct investment, $ per hectare (fdi); Consumption of fixed capital (depreciation), million $ (consfix)
The resulting variable—the efficiency of land use, million $ per 1,000 ha of agricultural land Source Compiled by the authors
By the method of experiments, it was presented that four nearest neighbors are the optimal solution for choosing the neighborhood’s weight matrix, since almost all the necessary information about the neighbors is taken into account, and there is no redundant information. Nevertheless, all models were evaluated for all considered weight matrices, while similar results were observed, which indicates relatively high stability of the obtained estimates. The basic model for spatial regression [4] is: Y = Xβ + ε,
(1)
where Y—the value of agricultural land productivity per 1 ha; X—the factorial attribute values matrix; β—the vector of parameters characterizing the influence of the considered factors; ε—the vector of a random component characterizing the impact of factors not included in the model.
3 Results Figure 1 shows the differences in the efficiency of land use in Europe. Russia does not use its lands very efficiently because there are six time zones on the territory, and most of the agricultural land is included in the zone of risky farming. For the initial analysis of the presence of spatial effects, we constructed the Moran and Geary Indices [6, 10]. The analysis showed that there are spatial connections in Europe, which is very logical based on the history of its development.
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Fig. 1 The efficiency of land use in European countries, $ per 1 ha of agricultural land, 2015. Source: Calculated by the authors, based on [5]
We first built a baseline model (Formula 1) based on the variables in Table 2 to assess spatial effects in the residuals. We had only 35 observations and quite a lot of control variables. As a result, we did not take all the variables that were initially proposed. All regression coefficients turned out to be explainable from common sense. Moreover, it was interesting that the amount of fertilizer applied negatively affects the efficiency of agriculture. This trend is explained by the general trend in the production of environmentally friendly products, which use expensive fertilizers but in fewer proportions. Accordingly, the agricultural organization receives more profit. Moreover, green production receives large subsidies from the EU. The test for spatial lag and spatial effects in the residuals showed that we could have a spatial lag in the model. This lag is observed in the variables, and the lag in the residuals is most likely absent. Therefore, we decided to test several types of models. In the SAR model (Table 3), the spatial effect was not significant, which can most likely be explained by the relatively small sample size within one year. In contrast to the analysis of Moran and Giri’s spatial indexes, in the SEM model (Table 2), spatial effects are already detected (the Lamda coefficient is significant). The rest of the indicators are also significant. Moreover, if such models are built for each of the years from 2002 to 2015, the result will be approximately identical. Furthermore, to obtain more accurate estimates, we work with panel data using cross-sectional analysis. The figures are presented in prices comparable with 2010 in $, which gives us the possibility of a correct comparable result. As a result, it turned out that the higher the percentage of workers employed in agriculture among the total number of employed, the lower the efficiency of agriculture. The theory of production intensification logically supports this. Furthermore, the higher the performance of an individual worker, the greater the efficiency, and the more workers per 1 ha, the higher the return on agriculture.
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Table 2 Baseline regression without spatial effects, SAR, SEM for 2015 Variables
Simple regression
SAR
SEM
fdi2015
−0.0224***
−0.0255***
−0.0287***
(0.00682)
(0.00661)
(0.00456)
lvs2015
−0.00356
−0.00488
−0.0164*
(0.0153)
(0.0126)
(0.00873)
1.43e−05
1.64e−05**
2.60e−05***
(8.76e−06)
(7.55e−06)
(5.74e−06)
empl2015
−0.341**
−0.394***
−0.356***
(0.157)
(0.142)
(0.0934)
dnst2015
0.0189***
0.0206***
0.0229***
(0.00383)
(0.00370)
(0.00265)
−0.671
−0.766
−0.923***
(0.578)
(0.485)
(0.334)
frt2015
−0.0159*
−0.0184**
−0.0269***
(0.00894)
(0.00786)
(0.00657)
emplha2015
−3.613
−3.376
−4.741
(4.064)
(3.333)
(3.034)
−0.287
−0.299**
−0.373***
(0.184)
(0.151)
(0.115)
cptl2015
0.0911
0.405
1.076***
(0.599)
(0.611)
(0.415)
Constant
4.896*
5.387**
6.515***
(2.821)
(2.376)
(1.878)
vapw2015
eu2015
lnagrlnd2015
−0.129
rho
(0.150) −0.869***
lambda
(0.170) Observations
35
R-squared
0.891
35
35
Standard errors in parentheses *** p < 0.01, ** p < 0.05, * p < 0.1 Source Calculated by the authors
Foreign direct investment in the economy harms agriculture. Nevertheless, in this case, the time lag is not taken into account. The fixed-effects model is slightly better on the test than the random-effects model. However, the interpretation coefficients are practically the same. Haussmann’s test showed that the fixed effects model better describes the presented data.
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Table 3 Panel regression, 2002–2015 Variables
Simple regression Panel regression RE Panel regression FE
fdi
−0.000355** (0.000170)
(4.38e−05)
(3.85e−05)
lvs
−0.00192
−0.0101***
−0.0119***
(0.00319)
(0.00329)
(0.00307)
2.13e−05***
8.04e−06***
7.19e−06***
(2.45e−06)
(1.41e−06)
(1.28e−06)
empl
−0.116***
−0.0430***
−0.0234***
(0.0202)
(0.00966)
(0.00872)
dnst
0.00911***
0.00502***
−0.00378***
(0.000295)
(0.000674)
(0.00120)
−0.0290
0.00207
−0.0247
(0.105)
(0.0456)
(0.0404)
frt
0.000856
−0.00278***
−0.00193***
(0.000857)
(0.000324)
(0.000318)
emplha
2.990***
3.672***
2.008***
(0.673)
(0.589)
(0.556)
0.00333
−0.502***
−1.404***
(0.0323)
(0.0922)
(0.188)
cptl
−0.0501
−0.0862
0.0573
(0.164)
(0.0660)
(0.0616)
Constant
0.222
5.757***
14.52***
(0.433)
(0.872)
(1.580)
490
490
490
vapw
eu
lnagrlnd
Observations
0.000174***
0.000138***
Standard errors in parentheses *** p < 0.01, ** p < 0.05, * p < 0.1 Source Calculated by the authors
We found that practically all coefficients are significant, except for membership in the European Union. This may be because the impact on agriculture cannot be instantaneous. Moreover, preparatory work is carried out for the accession to the European Union to meet specific indicators. After the accession, countries also continue to implement changes until the level set in the European Union is reached. Regarding agriculture, these can be subsidies and protective bans for farmers that limit the production of certain types of products. In this model, we already see that foreign investment in the long term shows a positive impact. When we added the dummy variable of the year, it turned out that they are not significant for almost the entire period under our consideration.
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4 Discussion The question of choosing the types of distance matrices for the model remains debatable. In our study, we relied on the “four nearest neighbors” method. However, Corrado [2] suggests using a weight matrix based on the Gabriel neighborhood, since, in her opinion, it gives more objective results.
5 Conclusion Our hypothesis is confirmed. European countries are marked with the presence of positive spatial effects affecting the efficiency of agricultural land. The importance of spatial effects for agricultural productivity was confirmed. There are also positive spatial effects from increased population density, agricultural employment, and the use of fertilizers in neighboring countries. EU membership has no significant impact on agricultural efficiency. Reducing the intensity of the use of fertilizers while introducing the latest technologies increases the efficiency of agriculture.
References 1. Bobryshev AN, Elchaninova OV, Tatarinova MN, Frolov AV (2015) Management accounting in Russia: Problems of theoretical study and practical application in the economic crisis. Journal of Advanced Research in Law and Economics 6(3):511–519 2. Corrado LA, Fingeleton B (2011) Where is economics in spatial econometrics? J Reg Sci 52(2):210–239. https://doi.org/10.1111/j.1467-9787.2011.00726.x 3. Demidova O (2014) A spatially autoregressive model for two groups of interconnected regions (on the example of the eastern and western parts of Russia). Applied Econometrics 34(2):19–35 4. Elhorst, J. P. (2014). Spatial Econometrics from cross-sectional data to spatial panels, Springer 5. FAO. (2019). Official website. Retrieved from https://faostat3.fao.org/home/E. 6. Geary RC (1954) The contiguity ratio and statistical mapping. Inc Stat 5:115–145 7. Gerasimov AN, Gromov Ye, I., Nesterenko, A. V., Bezdolnaya, T. Y., & Klishina, J. E. (2015) Government control of regional agricultural economic systems under institutional transformations. Mediterr J Soc Sci 5(6):200–208 8. Kelejian HH, Piras G (2014) The estimation of spatial models with endogenous weighting matrices and an application to a demand model for cigarettes. Reg Sci Urban Econ 05:1–29. https://doi.org/10.1016/j.regsciurbeco.2014.03.001 9. Kulish NV, Sytnik OE, Tunin SA, Frolov AV, Germanova VS (2018) Approaches to the valuation of biological assets at fair value. Res J Pharm, Biol Chem Sci 9(3):746–750 10. Moran PAP (1948) Interpretation of statistical maps. Biometrika 35:255–260 11. Sapozhnikova NG, Batishcheva YA, Steklova TN, Demchenko IA, Kalnaya AY (2017) The improvement of the assessment mechanism of agricultural enterprises creditworthiness in conditions of national specificity. Journal of Advanced Research in Law and Economics 8(2):581–590
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12. Temirkanova AV, Anopchenko TY, Murzin AD, Taranova IV, Leshcheva MG (2017) The assessment of ecological and economic health population risk. Int J Appl Bus Econ Res 15(23):55–70 13. Trukhachev VI, Sklyarov IY, Sklyarova YM, Gorlov SM, Volkogonova AV (2018) Monitoring of efficiency of Russian agricultural enterprises functioning and reserves for their sustainable development. Montenegrin Journal of Economics 3(14):95–108
Key Digital Competencies Among University Students to Ensure Sustainable Development of Economic Systems Eugenia V. Taranova , Emin M. Magomadov , Olga A. Voropinova , Alina A. Vahrushina , and Tamara V. Skrebtsova Abstract The paper focuses on the problem of the formation of basic digital competencies among university students. It is a necessary condition for the formation of stability and sustainability of economic systems, through the organization of a new format of intensive project activities. The research relevance is due to the high rates of digitalization of the economy and the need to train qualified personnel capable of the digital transformation of economic structure as the basis for the sustainable development of socio-economic systems. A successful solution to this issue requires the emergence of more flexible and innovative forms of vocational training focused on building an individual trajectory of student development for the dynamic demands of the economy. One of such formats is the project and educational intensive, which, as a large-scale pedagogical experiment, was implemented on the basis of the Stavropol State Agrarian University under the auspices of the STI University 20.35. The authors reveal various approaches to determining the list of basic competencies of the digital economy among students and describe the algorithm for implementing the “SmartAgro” intensive for the formation of these competencies. The key stages of the design and educational intensive are digital input diagnostics on the platform of the University 20.35, selection to the intensive based on the results of diagnostic activities, recruiting interfaculty multiage project teams based on the roles identified using the diagnostic tools, and the project and educational activities immersed in a digital environment. The “SmartAgro” intensive became a successful experience of accelerated short-term preparation for the implementation of entrepreneurial project activities at a university, focused on the integrated formation of key competencies of the digital economy of future agribusiness specialists to increase their competitiveness. E. V. Taranova (B) · T. V. Skrebtsova Stavropol State Agrarian University, Stavropol, Russia E. M. Magomadov Chechen State University, Grozny, Russia O. A. Voropinova Stavropol State Medical University, Stavropol, Russia A. A. Vahrushina Financial University under the Government of the Russian Federation, Moscow, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_29
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Keyword Project activities · Design and educational intensive · Digital economy · Competencies of the digital economy · Practice-oriented learning
1 Introduction The post-industrial period of the functioning of modern society is due to the breakthrough development of digital technologies, revolutionary changes in the information space, and the exponential growth of data flows, causing the digitalization of all spheres of modern social life including the economy [11]. A radical change in the economic structure and modern challenges of the digital economy, which determine the sustainable development of economic systems, set global trends in the development of education, which should be aimed at forming the basic competencies of the digital economy and training leaders of digital transformation who are ready to effectively use the potential of digital technologies in the context of any professional activity. However, nowadays, the pedagogical, scientific community does not have a common understanding of the basic competencies of the digital economy. Thus, some authors refer to them as communication and cooperation in the digital environment, self-development in conditions of uncertainty, creative thinking, information and data management, and critical thinking in the digital environment [7]. Others include ways of thinking, ways of working, tools for working, and skills for everyday life [14]; necessary skills, interpersonal business skills, digital, technical, information, and entrepreneurial skills [2], information and computer literacy, media literacy, communication literacy, and attitude to technological innovation [3], etc. From our perspective, the most common basic competencies of the digital economy are such competencies as the skills of searching, analyzing, communicating, and processing information on the digital economy and project and entrepreneurial thinking. Based on this, the need for a transition from conservative, strictly standardized educational programs and closed educational systems to the emergence of new formats in the educational space of higher education aimed at the formation of this set of competencies is becoming apparent. Their key features should be short-term, mobility, flexibility, and variability, designed to build individual educational trajectories for students’ needs and the challenges of the modern economy. One of the most similar formats that meet the above features is student intensives, the organization experience of which will be described below.
2 Materials and Methods The initial stage in the implementation of the design and educational intensive was the mass diagnostics of students, in which 2,242 students from all faculties of the university took part. Diagnostics was focused on obtaining comprehensive results
Key Digital Competencies Among University Students …
Diagnostics, selection to intensive
The formation of teams
The organization of the first and second measures of the intensive
249
Control diagnostics
Fig. 1 The algorithm for the implementation of the design and educational intensive Source: Compiled by the authors
about each of the potential participants in project teams, including the level of formation of their basic competencies in the digital economy. The diagnostic examination included eight computer techniques placed on a special digital platform: The Behavioral Style and Motivation test, a diagnostic game for understanding project activities, a questionnaire for participants in a project and educational intensive, a Zimbardo time perspective test, a psychometric test, knowledge and skill tasks, business squat, and technical squat. All diagnostic activities were completed by 1,492 students. According to the results of the entrance diagnostics, students with the highest rating results were selected. They took part in the implementation of projects and educational activities in the intensive format. The project and educational intensive were organized according to the entrepreneurial type, based on the educational model developed by the University of the National Technology Initiative 20.35. Figure 1 shows the full cycle of the design and educational intensive. The specificity of the design and educational intensive of the Stavropol State Agrarian University, in contrast to other types of project activities at the university, was practice-oriented learning taking place in extracurricular activities with the team creating a real product result in a short time.
3 Results Based on the results of the entrance diagnostics, 200 students, who showed the highest scores, were selected to participate in the entrepreneurial intensive “SmartAgro.” Based on the diagnostic data, the students were given a specific role: – Entrepreneur (visionary)—a participant who can discern the core of innovation, new opportunities, and promising future; – A technologist-analyst—an executing specialist who organizes the implementation of project ideas, conducts analytical research, summarizes information, and owns technologies for implementing project activities; – Organizer—the coordinator between the project participants, an intermediary, and a communicator capable of creating conditions for everyone to work. The analysis of the results obtained based on the results of the entrance diagnostics in the intensive showed that the most significant number of students were
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Organizers
15%
42%
43% Entrepreneurs visionaries
Fig. 2 The overall ratio of the students’ roles in the recruitment of project teams based on the results of input diagnostics Source: Compiled by the authors
Table 1 The distribution of students’ roles in the intensive course based on the results of entrance diagnostics (in %) Roles
Facultiesa 1
2
3
4
5
6
7
8
9
Technologists-analysts
20
59
40
41
17
39
44
39
75
Entrepreneurs visionaries
80
35
52
44
67
22
41
47
35
Organizers
–
6
8
15
16
39
15
14
–
a1
– The Faculty of Social and Cultural Service and Tourism; 2 – The Faculty of Agricultural Mechanization; 3 – The Faculty of Veterinary Medicine; 4 – The Faculty of Agrobiology and Land Resources; 5 – The Faculty of Ecology and Landscape Architecture; 6 – The Faculty of Electrical Power Engineering; 7 – The Faculty of Economics; 8 – The Faculty of Accounting and Finance; 9 – The Faculty of secondary vocational education Source: Compiled by the authors
recommended for the roles of entrepreneur-visionary (43%) and technologist-analyst (42%) (Fig. 2). Simultaneously, the clear priority of the scored points related to the entrepreneurial profile is 64%. The smallest category is students who are recommended to be the organizers (15%), which is due to the specifics of the professional orientation of the university, focused primarily on the applied technological and economic training of agricultural specialists (Table 1). Subsequently, based on the input diagnostics data, the project teams of students were recruited randomly (based on a blind choice of the project team number) to form the most potentially productive collaboration combinations. Thus, 23 interfaculty teams of different ages were formed, including students from 9 faculties in 41 areas of training from 1 to 4 years of bachelor degree (specialty). Each team included 5–8 people, including participants of the intensive, recommended for the role of entrepreneur-visionaries, technologist-analysts, and organizers. Each team had a project mentor from among the undergraduates or university professors who expressed their desire to participate in the intensive. The general plan for the development of an entrepreneurial intensive at the Stavropol State Agrarian University assumed the implementation of two five-week cycles of design and educational activities. The work in the intensive involved the activity of students along three parallel lines:
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– Staged team project activities; – Individual educational activities of students; – Work to create a digital footprint on the Trello cloud project management program and the University platform 20.35. Intensive project activities were a priority. It assumed the creation of projects in the areas of STI markets and the priorities of the modern agricultural sector: the FoodNet market (smart agriculture, accelerated selection, new sources of raw materials, affordable organic matter, and personalized food), the TechNet market (3D prototyping for various sectors of the national economy), the market EnergyNet (alternative energy sources for agriculture), and EduNet market (educational technologies and products in the agricultural education system). According to a special methodology related to the project life cycle implementation, weekly team meetings of students with mentors were organized based on the “Boiling Point of Stavropol State Agrarian University,” where project ideas were formed and tested. The teamwork resulted in the creation of projects developed according to the Lean Startup and Customer development methodology, in the form of a prototype, a digital twin of a device, a digital 3D model of agricultural objects, an application for mobile devices, a demo version of a portal or website, online educational content, a virtual tourist route, etc. Together with the project activities, intra-university and extra-university educational activities were organized, scheduled on the University 20.35. The special value of educational events was because they took place at the same time with the educational activities of students and covered a wide range of topics related to project activities and the development of competencies in the digital economy. They were implemented at the request of project teams and by independent pre-registration for events of interest. The work with educational requests of students was carried out regularly in the form of a constructor for online surveys “Mentimeter” (Fig. 3). Thus,
What would you like to know more about? Большие данные Uncrewd aerial vehicles AI VR Project management Digital Diaries Blockchain
0
20
40
60
80
100
Fig. 3 Collecting educational queries using the “Mentimeter” online survey builder (in %) Source: Compiled by the authors
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the unique individual educational trajectories of the participants of the intensive were modeled, taking into account their interests and requests. The progress of educational and project activities of teams and individual students within the intensive structure was recorded in the formation and loading of a highquality digital footprint in the form of diaries on projects, educational artifacts in the form of collective digital summaries, reflections, presentations, etc. Together, they made it possible to build individual digital competence profiles of students and provide recommendations for further educational activities, taking into account the recorded achievements. At the end of the intensive, the final diagnosis was carried out using the same methods as the input one. We obtained results separately for each method (Table 2), and as a whole, reflecting the level and dynamics of the formation of the digital economy (Fig. 4). It should be noted that, compared with the initial data, there is an increase in all the studied parameters of the competencies of the digital economy among students participating in the intensive, which is the result of its effective implementation. According to the results of the repeated diagnostic section, it is clear that the most significant dynamics were recorded in such parameters as the skill of information processing (from 58.2% to 83.1%) and project-entrepreneurial thinking (from 36.1% to 66.8%). In the control group, 31.8% of students have the highest level, and 53.1% have an average level. In general, several conclusions can be drawn based on the results of the intensive. First of all, we solved a special educational and project task—generating and selecting the most productive project ideas, collecting and analyzing information, working with a potential consumer of the project, deep immersion and mastering digital technologies that accompany project activities, rallying the project team, forming basic competencies in the basics of the digital economy, etc. At the end of the intensive, the results of project activities were presented to experts in the field of IT technology and digitalization of the agricultural sector of the economy; the winning teams were selected. We will pay special attention to transferring the intensive to a permanent channel, ensuring the life of projects outside the intensive in the form of participation in acceleration programs and student competitions (grants) at the regional, federal, and international levels. Table 2 Scaling indicators according to the business squat method Qualities Awareness Autonomy
Entrance diagnostics 8.4
Control diagnostics based on the results of the intensive 10.1
6.4
7.2
10.6
10.7
Planning
8.3
9.4
Design-entrepreneurial thinking
7.5
9.2
Decision-making
Source: Compiled by the authors
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The formation of competencies of the digital economy for students participating in the intensive (in%) information retrieval 100 77,4% 80
92,9%
60 design-entrepreneurial thinking
information analysis
20 0
66,8%
36,1%
40
information processing 58,2% 83,1% Entrance diagnostics
62%
72,3%
digital communication 93% 84,6% Control diagnostics
Fig. 4 Comparative results of entrance and control diagnostics in intensive Source: Compiled by the authors
4 Discussion Thus, the presented experience of the functioning of the design and educational intensive showed the possibilities of building an educational and design environment in the conditions of a modern Russian university to form key competencies of the digital economy among students. We were also interested in identifying the existing international practice of developing these competencies in modern higher education. Additionally, we wanted to find out what university representatives use formats and methods of work for this and how effective they are. The discussion about the specifics of training future specialists for work in the digital economy to achieve its sustainable development is actively taking place in the modern pedagogical community. Thus, E. K. Samerkhanova, L. N. Bakhtiyarova, A. V. Ponachugin, E. P. Krupoderova, and K. R. Krupoderova [12] describe the experience of using projects when forming professional competencies of students. However, unlike our study, they implement the project method directly in educational activities using digital technologies, which, in their opinion, are a tool for creating and presenting a project, an information environment for a project, and an information space for presenting and storing a project. Interesting in the framework of our research is the work of a team of authors who present their experience in the formation of digital competencies of students based on the digital footprint in the digital educational environment (DEE). In other words, we are talking again about formalized learning activities. However, the authors agree with us about the special meaning of the digital footprint for the formation of digital competencies [5].
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E. E. Kotova [6] believes that digital competencies are based on high-level cognitive skills, for the formation of which new teaching methods are needed based on communication technologies for managing collective projects at the initial stages of training at a university. That is, she limits the use of project activities to 1–2 training courses, which, from our point of view, does not seem entirely justified, since the experience of conducting an intensive showed the effectiveness of the work of project teams of different ages. A. I. Rudskoy, A. I. Borovkov, P. I. Romanov, and O. V. Kolosova [10] conducted a large-scale study on reducing risks in building a digital economy. They identified seven types of competencies of university graduates relevant during the transition of Russia to the digital economy and developed twelve pilot training modules necessary for their formation. Their experience is interesting and will be partially taken in the future for the second cycle of the intensive since a comprehensive plan for the implementation of project activities is presented on the example of academic disciplines. E. V. Soboleva [13] suggests using the traditional approach with gamification and informatics to form the competencies in digital economy. In her project “Digital School,” she experimentally tests the effectiveness of mobile gaming applications with quest technology. She notes changes in cognitive activity, motivation, competencies in project activities, system thinking, and interdisciplinary communication among students. A. N. Privalov, Yu. I. Bogatyreva and V. A. Romanov [9] see the creation of a university engineering center “Digital means of production” based on the university as a way to form digital competencies. From our perspective, this innovative structure is quite promising since it allows students to engage in extracurricular project activities consistently and creates conditions for commercialization projects. Another promising area related to the formation of applied competencies in the digital economy is research, which describes the experience of using technological learning platforms. For example, some authors propose developing educational projects based on technology platforms with artificial intelligence “High Vox,” which creates a digital tracing of each student [4]. Other authors, for these purposes, use the corporate technological platform “Virtual Machine-Building Enterprise” [8]. Another group of authors uses a scientific and educational platform for training digital personnel for cyber-economy in EdTech subjects [1].
5 Conclusion Thus, we see that there is no single way to solve the issue of forming the digital economy competencies among students. Each of the presented options showed its pedagogical effectiveness. However, the implementation of the project-educational intensive within the university has, from our point of view, several advantages because this is an applied multifunctional activity of students, as a result of which they receive
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such competencies that are in demand on the labor market and correspond to the challenges of the modern digital economy.
References 1. Abdulkadyrov AS, Aliyev RM, Badavov GB (2019) Edtech: the scientific and educational platform for training digital personnel for the cyber economy. Contrib Econ 2:163–168 2. Asliturk E, Cameron A, Faisal S (2016) Skills in the digital economy: Where Canada stands and the way forward, information and communications technology council, Ottawa, Canada 3. Baymuratova LR, Dolgova A, Imaeva GR (2018) Digital literacy for the economy of the future. NAFI Publishing House, Moscow 4. Blagodarny EV, Vedyakhin AA, Raygorodsky AM (2019) The development of educational projects based on technological platforms with artificial intelligence. The experience of MIPT on the use of high vox-platform. In: Proceeding from IC-AIAI: international conference on artificial intelligence: applications and innovations, pp 12–17, Nicosia, Cyprus 5. Gurfova RV, Alikaeva MV, Prigoda LV, Karakaeva EU, Mineva OK (2019) Formation of a student’s digital competencies based on a digital footprint. In: Proceedings of the IT&QM&IS: international conference quality management, transport and information security, information technologies, pp 497–501, Sochi, Russia 6. Kotova EE (2019) Communication technologies in the training of IT specialists in the digital economy. In: Proceedings of the ComSDS: communication strategies in digital society workshop, pp 30–33, St. Petersburg, Russia 7. Ministry of Economic Development of Russia (2020) On the approval of methods for calculating indicators of the Federal project “Personnel for the digital economy” of the national program ‘Digital Economy of the Russian Federation’, 24 January 2020 No 41, Moscow, Russia 8. Pozdneev B, Tolok A, Ovchinnikov P, Levchenko A, Sharovatov V (2019) Digital transformation of learning processes and the development of competencies in the virtual machine-building enterprise environment. J Phys Conf Ser 1278(1):12–18 9. Privalov AN, Bogatyreva YuI, Romanov VA (2019) Engineering center as an innovative component of professional training of future IT specialists. Educ Sci 21(7):90–112 10. Rudskoy AI, Borovkov AI, Romanov PI, Kolosova OV (2019) Ways to reduce risks when building the digital economy in Russia. Higher Educ Russia 28(2):9–22 11. Samans R, Davis N (2017) Advancing human-centered economic progress in the fourth industrial revolution. http://www3.weforum.org/docs/WEF_Advancing_Human_Centred_E conomic_Progress_WP_2017.pdf 12. Samerkhanova EK, Bakhtiyarova LN, Ponachugin AV, Krupoderova EP, Krupoderova KR (2020) Project activities of university students by means of digital technologies. Lect Notes Netw Syst 91:460–467 13. Soboleva EV (2019) Quest in a digital school: The potential and peculiarities of mobile technology implementation. Eur J Contemp Educ 8(3):613–626 14. The Assessment and Teaching of 21st Century Skills (ATC21S) (n.d.). http://atc21s.org/
Educational Innovation in the Digitalization of Agroindustry Oleg P. Chekmarev , Elena V. Kovalenko , Irina G. Sudorgina , Svetlana A. Timoshenko , and Pavel M. Lukichev
Abstract The research relevance is due to the current challenges faced by the system of higher agricultural education in Russia. Technological and organizational changes taking place in the labor market in the agricultural sector change the role of higher education in the economy and require the improvement of the educational process. Ensuring the competitiveness of graduates of agricultural universities in the modern labor market requires mastering not only “hard” (primarily digital), but also “soft” skills. According to employers, graduates often lack such “soft” skills as leadership, adaptability, communication, creative skills, and the ability to work in a team. The analysis of the current system of agricultural education in the Russian Federation showed its low compliance with the listed requirements. Attention is drawn to the demand and low feasibility of mastering the competencies of using digital technologies and staffing the agricultural consulting system. The authors indicated the need to take into account methods of eliminating the shortcomings of modern school education when creating university educational programs. Models for improving education are proposed, including those based on the interaction between the administration of universities, teachers, students, employers, and government authorities. The presented models contain direct and indirect impacts on the formation of competencies of graduates. Keywords Innovation · Digitalization · Agro-industrial complex · Agroindustry · Higher education · Additional education
O. P. Chekmarev · E. V. Kovalenko · I. G. Sudorgina · S. A. Timoshenko Saint Petersburg State Agrarian University, Saint Petersburg, Pushkin, Russia P. M. Lukichev (B) Baltic State Technical University “VOENMEKH” named after D. F. Ustinov, Saint Petersburg, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_30
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1 Introduction Trends in the development of the economy and agroindustry lead to the need to introduce innovative approaches in education to improve the quality of human capital. Modern processes in the economy cause the need for a change in emphasis in the formation of various kinds of competencies, and the need for the development of new knowledge, skills, and abilities. Being an integral part of the economy, the agricultural sector is obliged to perceive and respond appropriately to the noted challenges of the time. Simultaneously, the system of training qualified personnel for agriculture should consider the specifics of the AIC economy. Thus, the purpose of this paper is to search for innovative approaches to improve higher agricultural education.
2 Materials and Methods To achieve the research objectives, at the first stage, general trends in the development of the economy associated with digitalization, robotization, and other new processes of economic activity are studied. The specifics of the agroindustry are considered. The primary, current, and future requirements for specialists working in this area are investigated. In accordance with this, the main guidelines for the development of agrarian education are determined, and some innovative models aimed at improving educational technologies are proposed. The paper provides a critical analysis of the state of educational technologies taking into account modern and promising requests for specialists in the agricultural sector. At the same time, the analysis is based on a systematic understanding of the formation of educational systems reflecting the intertwining interests and capabilities of students, business, government, and educational institutions. The substantiation of the provisions and conclusions on the work is carried out based on the study of statistical materials reflecting certain problems in the agroindustry, the solution of which is limited without the use of innovative approaches in the organization of agricultural education in universities.
3 Results 3.1 Trends in the Development of the Agricultural Sector The trend of the modern labor market is determined by a combination of technological and organizational shifts that fundamentally change the working conditions. We should consider digitalization, robotization, the Internet of Things, information
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technology, and bioengineering among the technological changes. It is information and communication technologies that determine the face of modern civilization. The authors join the definition of digitalization as a process that turns actions, information, and results in data that can be compiled, analyzed, and disseminated [19]. As a result of digitalization and specialization, workplaces will become more knowledge-intensive and dynamic than it is now. Among the organizational changes, we highlight the increasing role of flexible employment, freelancing, self-employment, and a project-based approach. Technological and organizational innovations in the modern labor market require updating the educational process [8]. The directions of development of the agrarian sector repeat the trends in the development of the economy in many respects. At the same time, the agro-industrial complex also has specific features that must be taken into account when introducing innovations. Among these features, it is necessary to distinguish the following: • The land is not just a location for economic entities, but it is the primary means of production; • The means of production include living organisms, which determine the importance of bioengineering in the development of agroindustry; • Relatively high dependence of labor results on agro-climatic conditions; • The period of use of labor is less than the period of production; • The presence of territorial dispersal of production; • Limited opportunities for the development of small businesses without the use of cooperation mechanisms [7]. The modern labor market in the agricultural sector is fundamentally different from that existed 30–40 years ago. Earlier agriculture was based on the attraction of cheap unskilled labor. Currently, the use of free labor, including migrants, became difficult. Labor shortages are evident, especially in labor-intensive crop production. In particular, according to CalAgJobs, there are two jobs in U.S. agriculture for every new job seeker [24]. According to our calculations, the number of people employed in agriculture decreased by 20%, while their wages increased by 51% from 2000 to 2014 [22]. This creates the need for the digitalization and robotization of work processes. The next challenge for modern agriculture is the changing nature of the demand for consumer products. Three trends are developing almost in parallel: growing demand for organic products, growing meat consumption in developing countries, and the growing consumption of vegetable proteins in developed countries. Considering the growth in incomes of the population of developing countries and following the FAO forecast, by 2050, there will be an increase in the total volume of consumed meat by 76%. This prompts the development of laboratory-grown meat from animal cells and other artificial foods. The consequence of the ongoing changes in the agrarian sector is an increase in global investment in food technologies, from farm management systems, robotics, and mechanization to the development of new food products.
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The listed set of features of farming in the conditions of the noted trends in its development leads to the formation of specific working conditions and requirements for specialists working in the agricultural sector. This includes: • Less-developed socio-economic infrastructure in rural areas than in urban areas, which affects motivation to work and live in rural areas; • The processes of labor specialization in agriculture, expanding the list of narrow professions (drone operator, agrocybernetic, agroecologist, etc.), and increasing labor efficiency when using innovative technologies lead to an increase in the number of facilities serviced by one specialist. There is a gradual separation of the professional from the service of a specific organization, transitioning to the contract nature of work. These tendencies are especially manifested in the provision of specific functions of agricultural production in small forms of management (farmers, etc.). • The role of universal specialists who have competencies in their narrow field and in related areas of agroindustry is growing. Even IT specialists or economists working in the agroindustry should have versatile agricultural knowledge and skills. • There is a growing demand in the market for specialists who can effectively master new technologies, have the skills of continuous training, and can conduct a critical assessment of proposed innovations. The analysis of the current agrarian education system in Russia allows us to speak about its low compliance with the listed requirements. Studying the enlarged group of training directions 38.00.00 “Economics and Management” that is closest in terms of the possibilities of using digital technologies, it can be noted that out of 54 universities included in the system of agricultural education, no more than six organizations implement specialized training programs for work in the field of the AIC digitalization. Even taking into account the concept of flagship universities [2], with eight federal districts and 85 regions, this is not enough. Analyzing the statistics on the staffing of the agricultural consulting system in Russia, it can be seen that, on average, one region of Russia accounts for about three agronomists-consultants, five livestock specialists, two engineers, and less than one specialist in the field of IT technology. Even taking into account part-time workers, these numbers do not increase much. Just over a third of consultants have Candidate or Doctor Degrees [6]. Moreover, these specialists are practically not trained in universities.
3.2 New Requirements for the System of Training Specialists for the Needs of the Agroindustry Educational innovation can be defined as changing learning or teaching activities, leading to improved learning outcomes. The criteria for innovation are the efficiency
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and effectiveness, sustainability over time, and transferability of results outside the specific context of emergence [15]. In this case, it is required to take into account the objective capabilities and interests of applicants. Researchers draw attention to the shortcomings of school education in Russia, including the weak ability to use knowledge to solve applied problems and a low level of mastering general interdisciplinary skills [17]. In agricultural education, the low motivation of applicants to acquire professions related to agriculture is observed. Based on the analysis, in the formation of educational programs in the higher education system, it is necessary to pay special attention to the following elements: • The creation of programs providing for the formation of skills in the digitalization of agricultural production. There is a need for programs aimed at training specialists in digitalization in the AIC. At the same time, as part of the training of graduates of other professions, it is required to introduce separate disciplines or modules to develop digital technologies; • The training of highly qualified specialists should be oriented towards activities in the conditions of predominantly contracting and consulting services by including the corresponding blocks of disciplines in the educational programs. To create a personnel reserve of organizations and managers of farms, it is necessary to increase attention in relation to the formation of competencies in specialists in areas of activity related to the acquired profession; • The new nature of work and the growth of its specialization lead to an increase in the role of soft skills relative to hard skills. Skills in teaching, critical analysis, teamwork, and communication come to the fore; • The discrepancy between the basic training of applicants and the needs of modern higher education and the labor market makes it necessary to focus on the formation of competencies in self-education and system thinking in the first years of the bachelor’s degree; • The speed of changes in the agrarian sector requires the preservation and development of systemic knowledge and skills in agroindustry among first-year undergraduate students. Simultaneously, the growth of efficiency and motivation for learning is facilitated by filling the training programs of the first semesters with disciplines that reveal the essence of the future profession; • Based on the limited time for classroom work and the need for the formation of soft skills, which, by their specificity, are better learned during direct communication with the teacher, leads to an increase in the role of independent work in mastering hard skills. This, in turn, requires increased attention to the methodological support of the educational process; • The reduction of the inertia of universities [3] is achieved by focusing senior courses on interaction with business entities and developing a practice-oriented approach, • It is inexpedient to train specialists in the field of digitalization, economics, and legal support of agriculture outside agricultural universities, as they have the potential to develop industry-specific competencies required by these specialists.
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The center of gravity of the educational process should be shifted from lectures to a mixed set of educational methods. The prevailing standardized testing of knowledge in students [12] requires replacement by assessment measures that are more adequate to the modern labor market. Meeting current challenges in higher education requires new ways of learning, teamwork, and new definitions and measures of progress and success [18, 20]. In general, innovative technologies in education should be focused on creating an institutional sphere focused on improving the quality and competitiveness of educational organizations [9] and on transferring knowledge to society [14]. It is important to create an atmosphere of “joint creativity” of students, professors, and practitioners (employers). The goal of the transformation is a harmonious combination of hard and soft skills in graduates to make them resistant to the challenges of a flexible labor market and determined to follow the concept of “Learning for Life.”
4 Discussion Taking into account the guidelines for the development of agrarian education formed in the previous part of the work, we will offer schematic models for its improvement. The first model is system-wide and is aimed at taking into account the factors contributing to the formation of current and future competencies of graduates of agricultural universities (Fig. 1). The model is based on the ideas about the relationship of educational subjects [4] and the roadmap for developing key competencies developed by Aleryani and AlMunifi [1]. Unlike the authors of this roadmap, we propose to expand the circle
Competencies of graduates
Business entities
Teachers Administration of universities
State and municipal authorities
Students and parents
direct impacts indirect impacts Fig. 1 The model for the formation of competencies in the field of the agricultural industry, taking into account the future requirements of the labor market. Source: Compiled by the authors
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Table 1 The model of the staged formation of competencies in the field of agroindustry within the educational program Course of Study
1
2
3
4
The main period for the formation of competencies UC
++ +
GPC
+
PC
++
+
+
++
++
Priorities of requirements for the organization of the educational process within the stage The development of learning skills, independent work, ability to search for information; The formation of system knowledge; Unification of requirements for the organization and control of the educational process in all disciplines; Special attention to the quality of methodological support; Introducing students to their future profession
The formation of systemic knowledge and skills in professional and related fields; The development of teamwork, communication, and analytical skills; Enhancing the use of unstructured data and information in the educational process
Enhancing interaction between students and employers; Practice-oriented learning; Project work
The development and consolidation of highly specialized skills; The preparation of the final paper; Employment
+ + – main period of competence development. + – initial or reinforcing period of competence development. Source: Compiled by the authors.
of subjects that influence the formation of competencies. This, in turn, presupposes the division of such impact into direct and indirect. At least five groups of agents take part in the formation of competencies: business entities, teachers, university administration, students and their parents, state, and municipal education authorities. Teachers who are directly involved in the process of learning and control of knowledge have a direct impact on the formation of competencies. Students directly impact the formation of competencies through self-motivation, completing assignments, and participation in the educational process [21]. Employers can influence the formation of competencies through direct interaction with students during practice and quality control of education. The administration of universities also has an indirect effect on the acquisition of competencies by creating conditions for obtaining an education (the formation of training infrastructure, the development of academic mobility programs, etc.). The other influences of the subjects of the educational process are of an indirect nature and affect the direction and quality of education through the interaction between these subjects. Thus, state authorities, through interaction with employers and focusing on the strategic interests of the state and its particular regions, set the vector for the long-term development of education, changing the amount of funding, forming admission figures for budget places, rising prestige, and informing
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the population about the prospects of choosing a particular profession. The administration of universities creates incentives for teachers through the formation of systems of material incentives, career growth, etc. [16]. Thus, when each subject participating in the education process fulfills its functions, one can count on improving the quality of mastering competencies, both relevant and those that will be needed in the future. Simultaneously, the consistency of this process is apparent, failures in one element of the system can significantly reduce the possibilities of an effective educational process as a whole. The next proposal is devoted to modeling the stages of forming groups of competencies within the educational program (Table 1). The model is based on the existing system of division of competences in the Federal State Educational Standard of generation 3++ into universal (UC), general professional (GPC), and professional competences (PC), taking into account the timing of training of bachelors, features of basic training, and the demands of the modern labor market. The use of this model will improve the process of forming competencies and direct their development to the current demands of the labor market.
5 Conclusion Higher education of the future, focused on training specialists in the digitalization of the agroindustry, should be more flexible than the existing one. This is due to technological and organizational changes taking place in the modern agricultural market. The introduction of educational innovations in the educational process is the primary means to achieve this goal. It should be designed for a harmonious combination of “hard” (especially digital) and “soft” skills, the formation of not a one-sided specialist, but a comprehensively developed employee capable of independently responding to the challenges of the time in the agroindustry.
References 1. Aleryani AY, AlMunifi AA (2019) A roadmap to the development of key competencies of engineering and technology graduates. Int J Eng Pedagogy (IJEP) 9(5). https://doi.org/10. 3991/ijep.v9i5.11094 2. Baryshnikova MJ, Vashurina EV, Sharykina EA, Sergeev JN, Chinnova II (2019) The role of supporting universities in the region: transformation models. Educ Issues Educ Stud Moscow 1:8–43. https://doi.org/10.17323/1814-9545-2019-1-8-43 3. Berényi L, Deutsch N (2018) Effective teaching methods in business higher education: a students’ perspective. Int J Educ Inf Technol 12 4. Bidabadi N, Isfahani A, Rouhollahi A, Khalili R (2016) Effective teaching methods in higher education: requirements and barriers. J Adv Med Educ Prof 4(4):170–178 5. Caplan B (2018) The case against education: why the education system is a waste of time and money. Princeton UP, Princeton
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6. Center for Agricultural Consulting and Retraining of Agricultural Personnel (2014) Report on the provision of advisory assistance to agricultural producers and the rural population in the Russian Federation in 2013, Moscow, Russia. https://mcx-consult.ru/otchety-ob-okazanii-kon sultatsionnoy-pomoshchi-selskokhozyaystvennym-tovaroproizvoditelyam-i-selskomu-nasele niyu-v-rossiyskoy-federatsii. 7. Chekmarev OP (2013) Motivation and socio-economic efficiency of agricultural cooperation. Proc St. Petersburg State Agrarian Univ 31:142–148 8. Clement S (2017) Digital learning, education, and skills in the digital age. RAND Corporation, Santa Monica 9. Fidalgo-Blanco A, Sein-Echaluce ML, García-Peñalvo FJ (2015) Epistemological and ontological spirals: from individual experience in educational innovation to the organizational knowledge in the university sector. Progr Electr Lib Inf Syst 49(3):266–288 10. Fitzgerald H, Bruns K, Sonka ST, Furco A, Swanson L (2016) The centrality of engagement in higher education: reflections and future direction. J High Educ Outreach Engagem 20(1):245– 254 11. Francis CA, Jordan N, Porter P, Breland TA, Lieblein G, Salomonsson L, Sriskandarajah N, Wiedenhoeft M, DeHaan R, Braden I, Langer V (2011) Innovative education in agroecology: experiential learning for sustainable agriculture. Crit Rev Plant Sci 30:1–2. https://doi.org/10. 1080/07352689.2011.554497 12. French D (2018) Massachusetts consortium for innovative education assessments: creating a grassroots accountability system to leverage state policy change. Educ Policy Anal Arch 26(16). https://doi.org/10.14507/epaa.26.3442 13. Friedman HH, Friedman LW (2018) Does growing the number of academic departments improve the quality of higher education? Psychosociol Issues Hum Resour Manag 6(1):96–114 14. García-Peñalvo FJ (2016) The third mission, education in knowledge. Society 17(1):7–18 15. García-Peñalvo FJ, Llamas Nistal M (2017) The engineering behind the technological-based educational innovation. Int J Eng Educ (IJEE) 33(2B):763–767 16. Ivanova NL, Popova EP (2017) Professionals and the problem of introducing innovations at the university. Educ Issues Educ Stud Moscow 1:184–206. https://doi.org/10.17323/1814-95452017-1-184-206 17. Klyachko TL, Semionova EA, Tokareva GS (2019) Success and failure of schoolchildren: parents ‘expectations, teachers’ assessment. Educ Issues Educ Stud Moscow 4:71–92. https:// doi.org/10.17323/1814-9545-2019-4-71-92 18. Lukichev PM (2017) Economics of higher education in Russia: state regulation or deregulation? Prosp Sci Educ 4(28):23–27 19. Martin DA (2018) Shaping the digital future in education – together. Int J Eng Pedagogy (IJEP) 8(2):7–9. https://doi.org/10.3991/ijep.v8i2.8228 20. Ramaley JA (2014) The changing role of higher education: learning to deal with wicked problems. J High Educ Outreach Engagem 18(3):7–22 21. Shcheglova IA, Koreshnikova JN, Parshina OA (2019) The role of student involvement in the development of critical thinking. Educ Issues Educ Stud Moscow 1:264–289. https://doi.org/ 10.17323/1814-9545-2019-1-264-289 22. U.S. Department of Agriculture, Economic Research Service (USDA/ERS) (2014) Farm Labor, Washington, D.C. https://www.ers.usda.gov/topics/farm-economy/farm-labor/backgr ound.aspx. 23. U.S. Department of Agriculture, National Agricultural Statistics Service (USDA/NASS) (2014) Quick Stats, Washington, D.C. 24. Walter J (2018) Help wanted: how farmers are tackling a labor shortage. Successful Farming (SF). https://www.agriculture.com/farm-management/estate-planning/help-wantedhow-farmers-are-tackling-a-labor-shortage.
Digitalization and Sustainable Development in the Federal Districts of Russia Vladimir I. Trukhachev
Abstract The paper focuses on the development of the digital economy in Russian federal districts. The research relevance is because the digital transformation of the economic structure of Russian society as an innovative trend in its sustainable development is of key importance for increasing the efficiency of innovation and overall economic growth, as well as the welfare of the population. The successful implementation of this process requires the development of system-integrated methods for monitoring digitalization processes throughout Russia for an objective differentiated assessment of the current situation of digital transformation in the regions and further management decisions to intensify it. One of these methods is the methodology presented by the author of the paper for analyzing the development of the digital economy of Russian federal districts, which includes five analytical blocks for assessing: availability, technical security, management, infrastructure, and innovation. The author describes in detail the specifics of the development and implementation of this technique. Based on the results obtained with its help, the author draws conclusions about the level of digitalization of the Russian federal districts; their comparative analysis is given in the context of individual analytical blocks of digital transformation. The described methodology can be used for annual monitoring of digitalization in the country and obtaining relevant information for regional and sectoral management of the digital transformation of the regional economy to increase the sustainability of their development and smooth out existing imbalances. Keywords Sustainable development · Digital transformation of the economy · Digital divide · Regional economy · Digital technology
V. I. Trukhachev (B) Stavropol State Agrarian University, Stavropol, Russia e-mail: [email protected] Russian State Agrarian University, Moscow Timiryazev Agricultural Academy, Moscow, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_31
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1 Introduction The dynamics of the introduction of digital technologies in the industry of the world economy shows that modern socio-economic systems are going through cardinal transformations. With the networked economy and digital communication channels, the world started to implement a trajectory of accelerated exponential growth. The business models of the largest corporations and Internet companies underwent a significant transformation, which predetermined an increase in GDP in developed economies [5]. Despite the significance and irreversibility of digital transformation in all spheres of public life, in Russia, it occurs at an uneven pace. This is due to the scale of the territorial structure, different levels of financing the regions, the heterogeneity of their geopolitical and natural resources, demographic and human potential, etc. [11]. In such conditions, it becomes an objective need to develop analytical methods designed to generate relevant and complete information about the degree of balance in the development of digital infrastructure in the regions. Such information can subsequently be used to adjust targeted development programs and national projects. This issue is of great interest to all participants in the digital economy. In this regard, taking into account the best practices of analyzing the digitalization of hightech companies in the world and the global experience in assessing the digital transformation of economic clusters in modern states, we developed a methodology for analyzing the development of the digital economy of Russian federal districts. This methodology makes it possible to assess the qualitative and quantitative parameters of the development of the digital economy in Russian regions and the degree of its impact on economic growth.
2 Materials and Methods The author used an integrated and systematic approach to study the phenomenon of digitalization of the economy and society as a complex, multidimensional, and dynamic object. In line with these approaches, the authors developed the methodology for analyzing the development of the digital economy of the Russian federal districts, the analytical capabilities of which make it possible to differentially assess the intensity of digitalization throughout Russia, their dependence on the production process and innovative activities, and the willingness of the subjects and the lack of resources while implementing digital technologies. Figure 1 shows the proposed model for assessing the development of the digital economy The methodology is based on the complex use of various quantitative and qualitative indicators for assessing the external and internal environment of the regions, combined into five analytical blocks (Table 1).
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Availability Innovation Infrastructure
Technical security Control
Fig. 1 Proposed model for assessing the development of the digital economy. Source Developed by the authors
Table 1 Analytical blocks for analyzing the development of the digital economy of Russian federal districts Analytical unit
The composition of indicators
Availability
The indicators reflect the needs and the scarcest areas of digital modernization in the regions
Innovation
It shows the effectiveness of research work in the regional economy and innovative activities
Infrastructure
This analytical block shows the state of the infrastructure of the digital economy in the regions
Technical security
This analytical block evaluates the number of technical means and technologies for the digital transformation of federal districts
Control
The informatization of the system of creation and distribution of administrative decisions of state authorities and local self-government bodies is evaluated
Source Developed by the authors
The methodology for analyzing the development of the digital economy of Russian federal districts involves the implementation of the following algorithm: 1.
2.
The information base of the study is collected in the context of the five analytical blocks. Eight federal districts of the Russian Federation were the assessment objects: The Central Federal District, the North Caucasian Federal District, the Northwestern Federal District, the Volga Federal District, the Ural Federal District, the Southern Federal District, the Siberian Federal District, and the Far Eastern Federal District. Based on open data, information for 2018 was collected. It reflected the current state of digital transformation in Russian federal districts. The second stage consisted in generalizing the results of the analysis of the development of the digital economy of the federal districts of the Russian Federation and, based on its data, building digital profiles of the analyzed federal districts, which allow us to see the most successful and problematic areas of digital transformation and the balance of management decisions for its implementation in Russia.
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3.
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The third final stage of the methodology included assessing the prospects and general readiness of federal districts for digitalization.
3 Results To test the presented methodological approach, statistical indicators of eight Russian federal districts were analyzed. As a result of expert selection, the author compiled a system of indicators for each block of analysis (Tables 2, 3, and 4). As a result of the study, we determined the development of digitalization for each analytical block of analysis in the context of the studied objects (Table 5). To rank the Federal Districts by the level of digitalization, we standardized the indicators. As a comparative base, we used not the average numerical indicators of the federal districts, but their maximum values: Tij = Xij / Ximax Table 2 Indicators for assessing the blocks of “Accessibility” and “Innovation.” Federal district
Availability X1
X2
X3
Innovation
X4
X5
X6
X7
X8
X9
X 10
X 11
X 12
X 13
X 14
Russian Federation
98.6
190.55
563.68
1.58
0.58
62.7
2.1
48.6
39.8
139.8
22.5
42.2
6.5
11.6
North Caucasian FD
98.1
156.93
608.26
1.45
0.6
54.1
0.9
11
36.7
48.9
13.9
32.7
4.5
7.6
Central FD
99.6
198.36
628.96
1.71
0.56
67
2.6
82.7
39.8
255.9
26.2
44.6
6.2
7.5
Northwest ern FD
99
197.67
507.25
1.75
0.6
70.3
1.6
65.8
38.3
141.4
24.8
44.7
5.8
16.3
Volga FD
98.5
179.41
458.92
1.62
0.56
61.7
3
38.9
49.1
113.1
22.6
41.4
13.3
3.8
Ural FD
98.2
198.27
575.09
1.41
0.63
64.2
1.2
34.8
37.1
78
24.4
43.4
4.3
25.9
Southern FD
981
180.55
517.36
1.35
0.68
60.5
1.1
18.3
31.1
83.7
20.3
43.2
5.6
9.7
Siberian FD
97.3
182.32
505.48
1.65
0.54
59.9
2.1
32.4
30.2
106.3
20.1
39.2
2.2
9.8
Far Eastern FD
97.5
224.63
959.19
2.11
0.64
52.7
2.5
18.2
30.2
62.4
17.3
41.6
3.4
16.7
Ximax
99.6
156.93
458.92
1.35
0.54
52.7
3
82.7
49.1
255.9
26.2
44.7
13.3
25.9
μHereinafter: X1 – the proportion of the population that can receive one TV program of terrestrial digital television broadcasting; X2 – the tariff for the provision of a subscriber line to the subscriber for permanent use, regardless of its type, month; X3 – the subscription fee for access to the Internet, rubles/month; X4 – the provision of a local connection via cellular communication, minute (rub.); X5 – the tariff for one minute of local telephone connection with a time-based payment system, minute (rub.); X6 – the share of organizations using Internet access with a speed of less than 2 Mbit/s, in the total number of organizations, %;
Source Compiled by the author
X7 – the resource base for R&D and innovation. The share of internal expenditures on research and development, % of GRP; X8 – institutional environment. The number of researchers who performed research and development, per 10,000 employed in the economy; X9 – the share of costs for R&D aimed at economic development, in the total volume of internal costs for research, %; X10 – R&D and innovation performance. The number of patents for inventions issued by Rospatent per 1 million population, pieces; X11 – the share of organizations that received orders for manufactured goods (works, services) via the Internet, %; X12 – the share of organizations that placed orders for goods (works, services) on the Internet, %; X 13 – the share of innovative goods, works, and services in the total volume of goods, works performed, and services provided; X 14 – the share of new technologies in the total number of advanced technologies.
28
24.5
19.9
18.9
15.4
17.7
18.1
28
Central FD
Northwestern FD
Volga FD
Ural FD
Southern FD
Siberian FD
Far Eastern FD
X imax
57
48
49
46
47
49
55
57
44
51
X16
67.8
61.3
61.2
62.7
67.8
64.9
66.9
65.9
49
63.9
X17
88.6
78.6
77.8
80.8
82.9
83.5
88.6
87.4
80.5
86.5
X18
6
4.2
4.9
4.7
6
4.8
5.2
5.3
3.6
4.8
X19
25.8
21.8
22.1
21.9
24.1
20.5
23.8
25.8
22.4
22.8
X20
20.9
16.9
18.5
16.5
20.9
17.9
18.9
20.2
12.8
18.5
X21
21.9
15.7
18.3
17.4
21.9
19.2
20.5
20.2
10.3
18.9
X22
41
32
35
31
30
32
37
41
29
35
X23
36.2
26.4
27.9
27.2
35.1
31.3
34
36.2
17.8
31.3
X24
236.5
162.3
180.6
174.7
195.5
184.3
225.1
236.5
133.2
196.9
X25
0.4
0.1
0.4
0
0
0
0
0
0
0.1
X26
26
17.5
20.3
17.7
24.6
21.9
23.5
26
8.7
21.6
X27
97.4
86.7
82.9
77.5
85.4
81.1
93.1
97.4
66.9
86.2
X28
2,455
863.8
690.4
602.3
643.4
642.7
867.1
2,454.7
302.5
1,140.9
X29
29
24
25
25
28
26
28
29
26
26.1
X30
96.6
87.9
91.6
92.8
96.6
96.4
80.8
85.5
72.7
88
X31
Source Developed by the author
X15 —fixed-line telephone density per 100 people; X16 — the number of personal computers per 100 employees of organizations, pieces; X17 —the share of organizations using local area networks, %; X18 —the share of organizations using broadband Internet, %; X19 —the share of organizations using RFID technologies, %; X20 —the share of organizations using cloud services, %; X21 —the share of organizations using extranet, %; X22 —the share of organizations using open source third-party operating systems; X23 – the number of personal computers with access to the Internet, per 100 employees of organizations, pieces; X24 —the share of organizations using Intranet, %; X25 —cellular penetration per 100 people, units; X26 —the number of public points with Internet access per 10,000 of population, units; X27 —the number of subscribers of fixed broadband Internet access per 100 people, units; X28 —the number of mobile broadband Internet subscribers per 100 people; X29 —the volume of postal services per capita, rub.; X30 —business digitalization index; X31 —the proportion of settlements with telephones in rural areas, %
20.8
7.9
North Caucasian FD
X15
Infrastructure
Russian Federation
Federal district
Table 3 Indicators for assessing the “Infrastructure” block
Digitalization and Sustainable Development in the Federal Districts of Russia 271
1.1
Southern FD
Siberian FD
12
18
14
3
18
1.2
Ural FD
X imax
3
Volga FD
14
11
1.6
Northwestern FD
18
13
2.6
Central FD
7
2.1
0.9
North Caucasian FD
14
X33
Far Eastern FD 2.5
2.1
Russian Federation
X32
Federal district Technical security
60,304
24,459.3
34,940.9
29,727.9
31,127
60,304
48,340
24,731.8
7,823
48,403.6
X34
91.9
87.1
87
88.6
40.9
35.9
91.9
91.5
76.9
89.3
X35
16.5
9
11.4
11.8
14.3
13.4
13.6
16.5
6.9
13.2
X36
46.4
35.2
33.5
36.4
38.9
38.5
46.4
43.5
29.7
39
X37
16.7
8.7
12.2
11.4
16.7
14.6
14.4
16.6
6.4
13.8
X38
29.2
18.9
24
25.2
28.7
26.7
27.2
29.2
14.8
25.90
X39
41
36.1
37.3
38.3
40.3
38.4
37.6
41
27.8
38.3
X40
Table 4 Indicators for assessing the blocks of “Technical security” and “Management.”
56.8
44.3
46.3
49.4
50.5
49.2
55.6
56.8
47.3
50.9
X41
93
89.1
88.8
90.1
91.5
91.7
93
92.9
82.5
90.9
X42
2.2
1.2
1.5
1.1
1.4
1.4
2.1
2.2
0.9
1.6
X43
Control
96.3
93.4
94.9
95.3
94.6
95.5
95.3
96
96.4
95.3
X44
91.9
85.2
88.1
90.2
88.9
91.2
91.9
91.1
91.4
89.9
X45
73
53.5
61
64.4
65.6
61.9
73
68.1
62.8
63.9
X46
8.3
3.5
4.4
5.5
7.3
7.3
5.8
8.3
3.8
6.4
X48
(continued)
68.7
61.8
63.3
62
61.8
66.7
67.1
68.7
54.3
64.9
X47
272 V. I. Trukhachev
X33
X34
X35
X36
X37
X38
X39
X40
X41
X42
Source Compiled by the author
X32 —R&D and innovation performance. The share of costs for technological innovation in the total volume of goods shipped, work performed, and services provided; X33 —the number of personal computers used for educational purposes, per 100 students of general education institutions (pieces); X34 —the volume of investment in fixed assets directed to the purchase of computer equipment, million rubles; X35 – the share of organizations that used means of protecting information transmitted over global networks, %; X36 —the share of organizations using CRM systems, %; X37 —the share of organizations that allocated technical means for mobile Internet access to their employees, %; X38 —the share of organizations using ERP systems, %; X39 —the share of organizations with dedicated software tools for sales management, %; X40 —the share of organizations that had specialized software for managing the procurement of goods (works, services), %; X41 —the share of organizations with a website, %; X42 —the share of organizations using email, %
X32
Federal district Technical security
Table 4 (continued) X44
X45
X46
X47
X48
X43 — the share of the employed in the ICT sector in the total employed population, %; X44 —the share of government agencies and local self-government bodies that used the Internet; X45 —the share of state authorities and local self-government bodies that used the Internet at a speed of 256 Kbps and above; X46 — the share of state authorities and local self-government bodies that had a data transfer rate over the Internet of at least 2 Mbit per second, %; X47 – the share of organizations that used electronic data exchange between their own and external information systems by exchange formats; X48 —the share of organizations using SCM systems
X43
Control
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Table 5 The results of the analysis of the development of the digital economy of Russian federal districts X1
Place
X2
Place
X3
Place
X4
Place
X5
Place
Overall rating
North Caucasian Federal District
1.0721
8
0.4149
8
0.5676
8
0.5499
8
0.7491
8
8
Central Federal District
1.2005
2
0.7872
2
0.9186
1
0.9275
1
0.9868
1
1
Northwestern Federal District
1.1834
3
0.6764
3
0.8391
2
0.8751
2
0.9366
2
2
Volga Federal District
1.0900
7
0.7972
1
0.7678
5
0.8534
3
0.8865
3
3
Ural Federal District
1.1553
4
0.6357
4
0.8205
3
0.8095
4
0.8772
4
4
Southern Federal District
1.1117
5
0.5288
7
0.7177
7
0.7553
6
0.8197
5
6
1.0998
6
0.5773
6
0.8105
4
0.7711
5
0.8188
6
5
1.3748
1
0.6271
5
0.7323
6
0.7272
7
0.7494
7
7
Siberian Federal District Far Eastern Federal District
X1 – Availability; X2 – Innovation; X3 – infrastructure, X4 – technical equipment, X5 – control. Source: Compiled by the author.
where Xij – current values of indicators of digitalization in the FD; Ximax – the highest numerical values of parameters among FD. Furthermore, the standardized values of all indicators and the arithmetic mean for each of the analytical blocks in eight federal districts were calculated. The leading positions in the rating in terms of the totality of all indicators are occupied by the Central Federal District, which is in the lead in three indicators (X3 – infrastructure, X4 – technical equipment, X5 – control) and in the second place in two more indicators (X1 – Availability; X2 – Innovation). The North Caucasian Federal District lags behind. It ranks last in all estimated indicators. At the same time, there are quite good indicators for the availability of infrastructure for the digital economy in the North Caucasus Federal District. In particular, this region is leading in terms of “providing a subscriber line for permanent use, regardless of its type” and “providing a local connection (conversation) over cellular communication, minute.” The region has a rather low share of organizations using the Internet at a speed of at least 2 Mbit/s and the highest share of state authorities and local governments using the Internet in the total number of surveyed organizations of public authorities and local authorities in the country. Among all the studied regions, the North Caucasian Federal District ranks fifth in terms of the share of expenditures on research and development aimed at developing the economy, in the total volume of internal expenditures on R&D, and the share of innovative goods, works, and services in the total volume of goods shipped and works performed. However, in terms of other innovation indicators in the digital economy, this region is in the last place.
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In the block of indicators of the state of digital infrastructure, the North Caucasian Federal District takes the last places, except for the indicator of “Share of organizations (in the total number of organizations) using cloud services” (the fourth place among all federal districts, 22.2% vs. 22.8% on average for country). Based on the results, a typological grouping of federal districts was carried out: – – – –
Progressive level of development of the digital economy; The average level of development of the digital economy; Inert level of the state of the digital economy; Depressive level of the digital economy.
The group with an average level of development of digital technologies included only the Central Federal District. The rest of the federal districts fell into the group with an inert level of the state of the digital economy (Table 6). When determining the typological groups of federal districts according to the level of development of the digital economy, it is also essential to correlate this indicator with other socio-economic features of federal districts (Tables 7). The table shows that there is a direct relationship between the level of digitalization of the federal district and its socio-economic indicators. Thus, the Central Federal District, which leads in the digital transformation of the economy, also has the first place in the ranking in terms of population, per capita income, the average annual number of employees, and gross regional product. At the same time, the North Caucasian Federal District, marked with a depressive level of development of the digital economy, ranks last in four out of five indicators in the rating of socioeconomic features of federal districts. Consequently, digitalization in the country is possible with positive dynamics of socio-economic indicators of Russian constituent entities.
4 Discussion The presented methodology for analyzing the level of development of the digital economy of Russian federal districts showed the possibilities of studying the potential of each of them in the context of the identified analytical blocks. However, what identical experience was accumulated in the research of modern scientists? What qualitative and quantitative indicators did they use to analyze digital transformation at the micro, meso, and macro levels? This issue is actively discussed in the modern scientific community. Thus, Bryukhovetskaya et al. [3] describe the experience of managing digital technologies in the national economy using the Digital Economic Development Index proposed by the State Atomic Energy Corporation “Rosatom.” This pilot Index included about 200 indicators characterizing the use of digital technologies in various economic sectors.
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Table 6 Results of the formation of typological groups of FDs by the development of the digital economy Interval value
District type
Federal district
Progressive level –
Characteristic
I
1–0.8
The most favorable infrastructural, technological, and administrative conditions for the development of the digital economy. High availability of digital infrastructure
II
0.6–0.8 Average level
Central Federal District
There is uneven access to digital infrastructure, which has a relatively high level of development. There is a rapid development of digital technologies in the corporate sector. Digital adoption is not balanced enough
III
0.4–0.6 Inert level
Northwestern Federal District, Volga Federal District, Ural Federal District, Southern Federal District, Siberian Federal District, Far Eastern Federal District
The indicators of the development of the digital economy, as a rule, are below the national average. The level of infrastructure development is insufficient. There are problems with access to digital infrastructure, which is not evenly distributed. There are significant signs of the digital divide
IV
0.2–0.4 Depressive level
North Caucasian Federal District
There is an uneven development of digital infrastructure, low economic growth, and the subsidized nature of the economy does not allow the uniform introduction of digital technologies. The public sector is developing in the first place. Digitization is funded on a leftover basis. The depressed state of key industries hinders the implementation of a systematic policy on digital transformation
Source Developed by the author
The work of a team of authors who present their experience in analyzing the conditions of economic growth and determining strategic priorities for the digitalization of Russian economy is also interesting in the framework of our research. As a research tool, including methods for analyzing static and dynamic information, they use the global Internet connectivity index [8]. E. L. Sidorenko and Z. I. Khisamova believe that, in the context of a qualitative transformation of industrial infrastructure and the transition to digital tools for economic development, it is necessary to develop the most understandable and consistent methodology for assessing the digitalization effectiveness. The authors consider the existing models that assess the digital economy and offer the author’s
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Table 7 The rating of Russian federal districts according to the main socio-economic features Federal district
Indicators Digitalization level
Population in the Federal District (thousand people)
The total land area of the Federal District (thousand ha)
Average per capita cash income (per month), rub
The average annual number of employed (thousand people)
GRP (million rubles)
North Caucasian Federal District
Depressive level
7
8
8
8
8
Central Federal District
Average level
1
6
1
1
1
Northwestern Federal District
Inert level
5
4
2
5
4
Volga Federal Inert level District
2
5
6
2
2
Ural Federal District
Inert level
6
3
4
6
3
Southern Federal District
Inert level
4
7
5
4
6
Siberian Federal District
Inert level
3
2
7
3
5
Far Eastern Federal District
Inert level
8
1
3
7
7
Source Developed by the authors
classification of models, which is undoubtedly interesting since their work is of systematizing nature [9]. A large-scale study on the development of information society in the Russian regions was conducted by Kulikova et al. [7]. To assess the development of information and communication technologies (ICT), they used the international rating of ICT development published in the annual reports of the International Telecommunication Union. Another group of scientists is investigating the definition of the role of ICT as part of business intelligence in improving welfare and as a resultant factor in the development of the country and society. They established a close relationship between the
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Human Development Index and indicators characterizing the virtual-digital environment, including the Internet, computers, global virtual networks, and mobile communications [6]. According to S. Bera, an accurate assessment of the current state of digitalization in India is necessary to develop effective initiatives to create a digital country and bridge the internal digital divide in the states. The analysis of the 17 largest Indian states for 21 variables over ten years allowed the scientist to construct a composite digitalization index using the principal component analysis (PCA) [2]. Another promising study related to the study of digitalization is the work of a team of authors who, based on secondary data from the European Commission, identified five components of the digital economy to create their digitalization index: ICT connectivity, Global Innovation Index, connected to the Readiness Index network, the share of households with the Internet, and export of high technologies [1]. At the same time, A. Tleppayev [10] believes that the primary indicator of the digitalization in the country is the level of energy consumption [10]. The key metric for measuring digitalization is the Digital Evolution Index discussed by Zvereva et al. [12], and Dobrolyubova et al. [4] consider the e-government development index as such.
5 Conclusion Secondary literature showed that there is no single way to solve the issue of assessing the digitalization of the economy. Each of the presented options showed its feasibility and is used by scientists for statistical analysis in scientific research. However, the described methodology for analyzing the development of the digital economy of Russian federal districts has several advantages because it allows us to conduct a comparative analysis of the development of the digital economy in the context of five analytical blocks, each of which has its specifics in terms of influence from the authorities. The analysis results can be effectively used in a comprehensive assessment of the development of the digitalization of regions and federal districts. It can also be a useful tool in administrative management and decision-making in the digitalization of the regional economy and the economy of the country as a whole.
References ´ 1. Afonasova MA, Panfilova EE, Galichkina MA, Slusarczyk B (2019) Digitalization in economy and innovation: the effect on social and economic processes. Polish J Manage Stud 19(2):22–32 2. Bera S (2019) Club convergence and drivers of digitalization across Indian states. Telecommun Policy 43(8):101822 3. Bryukhovetskaya SV, Artamonova KA, Gibadullin AA, Ilminskaya SA, Kurbonova ZM (2020) Management of digital technology development in the national economy. Conf Ser Earth Environ Sci 421(4):42–48
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4. Dobrolyubova E, Klochkova E, Alexandrov O (2019) Digitalization and effective government: what is the cause and what is the effect? Commun Comput Inf Sci 1038:55–67 5. Erokhin V, Endovitsky D, Bobryshev A, Kulagina N, Ivolga A (2019) Management accounting change as a sustainable economic development strategy during pre-recession and recession periods: evidence from Russia. Sustainability 11:31–39 6. Evseeva S, Kalchenko O, Plis K, Evseeva O (2019) The role of information and communication technologies as a part of business intelligence in improving the wealth of nations. Conf Ser Mater Sci Eng 618(1):012080 7. Kulikova NV, Persteneva NP, Ruslanova TV (2020) Information society development in regions of the Russian Federation. Lect Notes Netw Syst 84:214–224 8. Merkulova EY, Spiridonov SP, Menshchikova VI (2020) Strategic priorities of digitalization of the Russian economy. Lect Notes Netw Syst 91:38–46 9. Sidorenko EL, Khisamova ZI (2020) The readiness of the economy for digitalization: basic methodological approaches. Lect Notes Netw Syst 84:308–316 10. Tleppayev A (2019) Digitalization and energy: world experience and evidence of correlation from Kazakhstan. Econ Ann XXI 176(3–4):56–64 11. Trukhachev V, Bobrishev A, Khokhlova E, Ivashova V, Fedisko O (2019) Personnel training for the agricultural sector in terms of the digital transformation of the economy: trends, prospects, and limitations. Int J Civil Eng Technol 10(1):2145–2155 12. Zvereva AA, Belyaeva ZhS, Sohag K (2019) The impact of the economy digitalization on welfare in developed and developing countries. Econ Reg 15(4):1050–1062
Analysis of the Management System for the Balanced Innovative Development of Agricultural Production Oksana V. Takhumova , Nadezhda K. Vasilieva, Natalia V. Lazareva , and Tatyana P. Baranovskaya
Abstract The tendencies of new technological paradigms dictate the need for socioeconomic and environmental stability, and for innovative economic growth. This may provide a faster way of overcoming the current regional crises. The present rapid digitalization of Russian economy brings attention to forming a balanced, innovative development of the agricultural sector, which largely affects the living standards of the rural population, food security, and general national security. These conditions emphasize the importance of forming an effective management system for innovative agricultural development. Developing the infrastructure would increase the return on investment of innovative development in the agro-industrail complex. In this research, we specify the main stages of the management system for the balanced innovative agricultural development. The paper establishes the principles of balanced development in the beginning, middle, and end phases. The study describes structural and logical patterns of the interrelations between the agro-industrail complex, nature, and society. This study may prove useful to the regional and federal authorities, and researchers involved in the development of the regional agricultural sector. Keywords Management · Balanced development · Agricultural production · Matrix indicators · Efficiency
1 Introduction Globalization not only establishes global inter-dependence but also drives the need for intensive use of scientific and technological progress. This multifaceted nature of this problem presented a problem for years of scientific research. Only by the end of the twentieth century, scholars proposed a solution to this problem in the form of sustainable development. In this regard, there is an obvious need to conduct research O. V. Takhumova (B) · N. K. Vasilieva · T. P. Baranovskaya Kuban State Agrarian University named after I. T. Trubilin, Krasnodar, Russia N. V. Lazareva North-Caucasus Federal University, Stavropol, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_32
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on the promotion of “green economy” and innovative development. Such research should only observe the maximum economic growth using the resources of basic and accumulated potential, as well as investment funds. The problem of promoting regional innovation is caused by the need to push the production of agricultural regions to a new stage, which would increase profitability and provide society with high-quality goods and services in the required quantity. Research on the issues of balanced development of innovation and investment activities in the agricultural sector is a relatively new scientific direction. Economic theory acts as the epistemological basis of its origin and development. The following scientists made significant founding contributions to its development: L. Abalkin [1], N. Belokh [3], E. Campbell [5], N. Kondratiev [8], L. Leontyev [10], etc. The analysis of the equilibrium and stability of complex systems, and the economic stability are discussed in the works of M. Beltigiriev (2012), R. Kaplan [7], and other authors. A number of these authors imply that the development of economic processes should always lead to economic growth, thereby ensuring sustainable, balanced development. Some economists, including R. F. Abdeev [2], and A. Gladilin [6], believe the concepts of “balanced development” and “sustainable development” to be equial. However, based on the majority of secondary literature, we note that sustainable development is a system of economic processes that meet the needs of the population without exposing the future generation socio-economic and environmental threats. Representatives of the modern scientific school understand balanced development as correct and even development, which gives us reason to assume that the two concepts are not at all equal. In this study, we will apply the terminology of “equilibrium, proportionality, consistency” to the term “balance.” In this regard, the study mainly aims to justify the organizational and economic mechanisms, which will determine the principles and methods of scientific research of “balanced development.” These principles and methods will help to develop an effective tool for economic system management. It is a relatively new scientific step in determining the indexes of balanced, innovative development of agricultural production.
2 Materials and Methods Balanced development of agricultural production can be characterized by the longterm availability, location, and the effective use of potential resources. The study begins with the justification of the procedures at the planning stage (Fig. 1). Achieving balanced economic growth in the medium-term and long-term depends on several variables: the macroeconomic environment, state institutions, and innovative technologies. Within the framework of scientific research on increasing innovation activity, there are several approaches to research the problems of regional systems development. However, in the lens of a balance of the studied parameters, these approaches are presented fragmentarily, requiring a more focused study in relation to the agricultural sector of the economy.
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Fig. 1 Process approach to managing the balanced development of agricultural production. Source: Compiled by the authors
In this regard, the second stage of the study identifies the principles, based on the balance between development, action, and result (Fig. 2). In the third stage, the intended methods for research of balanced development should be based on the interconnection of nature, society, and agro-industrial complex (AIC) (Fig. 3). The process approach includes the stage of planning, action, and control (drawing up a system of indexes). The final stages is the development of a strategy for the balanced development of agricultural production. In order to assess the level of balanced development, we propose a matrix of evaluation criteria (Table 1).
3 Results The research direction intends to factor in not only the interconnection of nature, society, and the agricultural sector, but also territorial features in their dynamic development in the direction of “development,” “efficiency” and “effectiveness.” It is also necessary to factor in the economic, social, political, and environmental conditions affecting agricultural production. This implies the need to differentiate between quantitative and qualitative features, taking into account the differentiation of regions in the areas of balanced development, based on the indices of stability of functioning according to the selected parameters. The calculations are based on sub-indices of economic development, including indicators of employment, vitality, education; the criterion of financial and economic stability, marking the level of innovation and
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Fig. 2 The principles of balanced development. Source: Compiled by the authors
investment activity, economic growth and production potential; the criterion of political stability; environmental stability based on indicators of environmental security of the region (Fig. 4). These results demonstrate the ambiguity of the distribution of the selected territories by the level of balanced development. More even distribution can be achieved
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Fig. 3 Diagram of subsystem interrelation in a regional environment. Source: Compiled by the authors
by developing an effective organizational and economic mechanism for managing agricultural production within the region. The results of the study are demonstrated in Fig. 5. The regions of the Central Federal District have a more developed innovation infrastructure and a specific output of new technologies in the total volume of sold goods and services. In general, the research has shown that the distribution of the technological structure across the country is very uneven.
4 Discussion In the context of increasing globalization and digitalization, it is necessary to support the development of the agricultural sector on the principles of self-regulation and self-development. The designated management system is based on the relationship between objects and subjects of management and is marked with the presence of connections at the horizontal and vertical levels. It should be noted that this mechanism should act as a subsystem for national economic management. Improvement of the current management mechanism of the agricultural sector in the conditions of self-regulation and self-development acts as a dominant factor determining balanced development. We have repeatedly researched the problems of regional sustainable development within the territories of the Russian Federation, both on macro- and meso- levels, as well as in relation to individual industries and sectors of the economy. We have also identified the following pattern: to establish sustainable development, it is necessary to activate the mechanism of self-sufficiency and the self-regulation of economic systems. This research focused on studying this pattern. This research resulted in the expansion of scientific knowledge based on a process approach to research, which allowed us to propose their own group of principles and
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Table 1 Matrix indicators of balanced, innovative development of the regional agricultural sector Groups
Indicators
Development sub-indexes (S. D.) Action indicators
The share of the employed population of 25–64 years with higher education in the number of employees in this age group The level of development of broadband telecommunications (the number of broadband lines per 100 people) Share of innovative-active organizations in the total share of economic entities, %
The integration of innovation
Government spending on research and development, % of GDP Internal research and development costs, million rubles The volume of attracted investments from the Federal budget and the budgets of Federal development institutions in the innovative agro-industrial complex (infrastructure projects and regional investment projects) per 1 million rubles
Performance sub-indexes (P. I.) Interim results of economic activity Internal research expenditures, million rubles Share of expenditures on marketing and technological innovations in GRP, % The share of innovations in the total volume of produced goods and services Performance sub-indexes (I. R.) Use
Export of innovative products as a share of total exports, % The share of advanced technologies used in production units
Intellectual property
Developed innovative products Receipt of patent applications and issuance of protection documents
Source: Compiled by the authors
indicators of balanced development of agricultural production at the stages of development, intermediate level, and eventual outcome. The study describes structural and logical patterns of the interrelations between the agro-industrail complex, nature, and society. The balanced, innovative development of the regional agricultural sector is assessed based on the criteria and indicators ascertained by us. The results of the study will prove useful to territorial and federal authorities, as well as researchers involved in the organization and effective development of the regional agricultural sector.
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Fig. 4 Cluster organization of regions by the level of balanced development for 2018 Source: Compiled by the authors
Sevastopol
Rostov region
Volgograd region
Astrakhan region
Krasnodar region
Republic of Crimea
Republic of Kalmykia
Republic of Adygea
Southern Federal District
Central Federal District
2 1.5 1 0.5 0
Russian Federation
SDI
SDI
Fig. 5 Indicators of balanced, innovative development of the regional agro-industrial complex. Source: Compiled by the authors
5 Conclusion Thus, the analysis of innovative development and socio-economic significance of the agricultural sector in Russia has shown that improving the management mechanism based on self-regulation and self-development systems holds great potential for positive impacts on the development of the territory where the innovative potential is achieved. This includes increasing the investment attractiveness of the territory for business, forming its industry specialization, stimulating business activity, and improving the quality of life of the population.
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Acknowledgements We express our gratitude to the Russian Foundation for Basic Research for the opportunity to conduct research with the support and funding of the project 20-010-00089-A “Formation of organizational and economic mechanism for the balanced, innovative development of agricultural production.”
References 1. Abalkin L (2012) Russia: the comprehension of fate. Publishing House “Economic Newspaper, Moscow 2. Abdeev RF (1996) The methodology of sustainable development and the ways of its implementation in the conditions of Russia. In: Proceedings of Analysis of systems on the threshold of the 21st century: theory and practice, Moscow, Russia. 3. Belokh N (1986) The planned balance of supply and demand of the consumer. Nauka, Moscow, USSR 4. Betilgiriev M (2012) Conceptual approaches to ensure sustainable development of the enterprise as an economic entity of the regional economy. Manage Econ Syst Electron Sci J 1(37):1–12 5. Campbell E (2004) Strategic synergy, 2nd edn. PITER Publishing House, St. Petersburg 6. Gladilin A (2013) The balanced development of regions in the single economic space of Russia. Ileksa, Moscow 7. Kaplan R (2008) Balanced scorecard. “Publishing House of Olymp-Business” CJSC, Moscow 8. Kondratiev N (2002) Big business cycles and foresight theory, Publishing House “Economics”, Moscow 9. Larionova AA, Zaitseva NA, Fadeev AS, Zhenzhebir VN, Filatov VV, Pshava TS (2017) The use of organizational and technological innovations in the process of managerial and engineering personnel’s training. Eurasian J Anal Chem 12(7b):1573–1580 10. Leontyev L (2007) Raw materials and fuel base of ferrous metallurgy. Akademknig Publishing House, Moscow 11. Vasilieva N, Nechaev V, Takhumova O (2019). The role of transnational corporations in the globalization of the economy. Adv Soc Sci Educ Human Res 364
Digitalization of the Agro-Industrial Complex as the Main Factor of Regional Economic Development Elena A. Bessonova , Ekaterina V. Kharchenko , and Natalia B. Chernykh
Abstract Digitalization is becoming increasingly relevant as Russia enters the path of innovative development of complex socio-economic systems. Digital innovations in the agro-industrail complex [AIC] increase labor productivity, reduce production costs, and, as a result, ensure the sustainable development of the regional economy. The study monitors the development of the digital agriculture project within the regions to identify problems and prospects for improving the efficiency of the AIC in the Kursk Region. In this study, we used various theoretical and empirical methods, including logical and system analysis, data collection methods, and ranking. The analysis has shown that the AIC of the Kursk Region is rapidly improving. Kursk Region also increases its resource potential and successfully implements the “Digital Agriculture” pilot project of the Ministry of Agriculture. We note that to implement digital technologies in the agriculture of the Kursk Region, the quality and professional skills of IT specialists must be improved first. The scientific novelty of the research lies in developing directions for improving the efficiency of the AIC via digitalization. The results of this study may serve as a methodological basis for further research in the field of innovative development of complex socio-economic systems. Keywords Digitalization · Agriculture · Agro-industrial complex · Region · Development · Economic growth
1 Introduction In the era of digital globalization, devices are becoming more compact, faster, more accessible, and powerful, ultimately becoming the solution to an increasing number of problems. Currently, Russia enters a period where digital solutions should help the AIC solve the problems of increasing labor productivity and ensuring sustainable development.
E. A. Bessonova (B) · E. V. Kharchenko · N. B. Chernykh Southwest State University, Kursk, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_33
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The Kursk Region is one of the regions testing pilot digital solutions in the field of agriculture, for example, the “Digital Agriculture” project of the Ministry of Agriculture. The regional agriculture is one of the most digitalized in Russia.
2 Materials and Methods The statistical and economic-mathematical methods for analyzing indicators of the regional agricultural sector development serve as the methodological basis of the research. To determine the level of digitalization in the agricultural sector of the Kursk Region, we analyzed the volumes of state support for the AIC of the Kursk Region for 2016–2019. The paper also studies the structure and dynamics of the volume of shipped domestic production goods (works, services) by type of economic activity in the Kursk Region. The paper also analyzes the structure and dynamics of the volume of AIC export in the region. A comprehensive assessment of the digital development within the region allowed us to draw up a general pattern of digitalization and suggest measures to improve the digitalization of the regional AIC. The data acquired from the Ministry of Agriculture of the Russian Federation [10], the Food and Agriculture Organization of the United Nations [FAO] [6], the Federal State Statistic Service [5], and periodic publications (The Kursk Region in figures, 2019) formed the empirical basis of the research.
3 Results The implementation of the Departmental project “Digital agriculture,” developed by the Ministry of Agriculture, will contribute to the 100% consolidation of agricultural data on a single platform by 2024. According to the project, all agricultural producers will use digital services, while the share of traceable agricultural products will reach 80% [10]. Despite the fact that the implementation of the project is planned for the period of 2019–2024, we can already consider the prospects for the development of agriculture in the region by analyzing the current situation [3]. First, let us address the State program for support of the AIC within the regions [8]. The study will analyze the changes in the volume of state support for the AIC throughout 2016–2019 (Fig. 1). As shown in Fig. 1, the volume of state support for the Kursk regional AIC in 2018 decreased significantly compared to 2016 and 2017. However, in 2019, the volume of state support increased compared to the previous year. The “Digital agriculture” project will help accelerate the process of obtaining and improving the effectiveness of state support measures in agriculture. Next, we will analyze the dynamics of the volume of shipped goods (works and services) from 2016 to 2018 (Table 1).
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The volume of state support for the agricultural industry of Kursk Oblast, thousand RUB 60,00,000 50,00,000 40,00,000 30,00,000 20,00,000 10,00,000 0
2016
2017
2018
2019
Fig. 1 The volume of state support for the AIC of the Kursk Region. Source: Compiled by the authors based on [5] Table 1 Structure and dynamics of the volume of shipped domestic production goods performed works and services by type of economic activity in the Kursk Region Index
Extraction of mineral resources
2016
mln. RUB
%
49,180
17.85
2017
2018
The Deviation growth of 2018 to rate 2016 from 2018 to 2016
mln. RUB %
mln. RUB %
%
67,782.8 21.95
91,506.9 26.12 186.07
pp 8.27
Manufacturing 167,197 60.68 176,100.2 57.03 192,746.2 55.02 115.28
−5.66
Provision of 52,379 electric power, gas, and steam; air conditioning
19.01
60,308.6 19.53
−1.98
Water supply; 6,771 water disposal, waste management, anti-pollution activities
2.46
4,582.1 1.48
6,431.9 1.8
94.99
275,527 100
308,773.7 100
350,339.6 100
127.15
Total
Source: Calculated by the authors based on [16]
59,654.6 17.03 113.89
−0.66
0
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Table 1 demonstrates that the volume of shipped goods (works, services) of domestic production increases for almost all types of economic activity every year. The exception is water supply, water disposal, waste management, and anti-pollution activities, the volume of which decreased slightly in 2018. The structure of shipped goods in the Kursk Region is dominated by manufacturing, accounting for more than 55% of the total volume. However, during the study, the structure of shipped goods (works, services) for mining saw a noticeable increase, which indicates the development of mining activities within the region. The project of the Ministry of Agriculture is aimed at increasing the volume and revenue from the sale of goods on the domestic market. Thus the situation for shipped products of domestic production will continue to improve [2]. In recent years, the Kursk Region took a leading position not only within the Central Federal District but also in the whole of Russia in terms of grain, sugar beets, potatoes, and meat production. For example, in 2019, a high yield of sugar beet was recorded—49 tons per 1 ha, the yield of grain amounted to 5.05 tons per ha, the yield of potatoes amounted to 20.17 tons per ha [15]. The increase in yield is caused by the introduction of new technologies for soil cultivation, digitalization of agricultural processes, and harvest timing systems. Additionally, 2018 was marked by a positive trend in the balance of financial results of agricultural organizations. In 2018, the net profit of agricultural enterprises increased by 75.8%. The export trends are presented in Table 2. The structure of agricultural products export in the Kursk Region in 2018 is presented in Table 3. Having analyzed the structure (Table 3) and dynamics (Table 2) of Kursk Region exports, we conclude that, in 2018, the exports of all types of economic activities have increased, compared to 2017. We also expect to see an increase in the volume of exports for all indicators by the end of 2019. Figure 2 presents the plan of digitalization of agriculture according to the project “Digital agriculture.” Automation of reporting will help reduce costs and time for this process. All reporting will also take place within a single interface. Digital profiles will allow collecting data on agricultural producers within a single service, which will serve as a basis for improving the efficiency of their activities and will help avoid the costs of paper document management. The development of state support measures (factoring in regional and Federal needs) for agricultural products will help ensure targeted support. Maintaining and registering the achievement of targets will allow monitoring the targeted use of state support funds. In general, all of the above will help to increase the gross production of agricultural products and create conditions for increasing the export potential of the Russian Federation.
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Table 2 The dynamics of the AIC export volume in the Kursk Region Index
2017
2018
2019 (plan) The growth rate The growth rate of from 2018 to 2017 2019 to 2018 (plan. to the fact.) %
%
Export volume of 116.6 agricultural products
Million USD 157.5 163.3
135.1
103.7
Export volume of 2.9 fat and oil industry products
3.1
3.2
106.9
103.2
Export volume of 21.7 grain crops
61.0
61.2
281.1
100.3
Export volume of 1.2 meat and dairy products
1.2
1.3
100.0
108.3
Export volume of 90.0 food and processing industry products
91.3
96.7
101.4
105.9
Export volume of 0.8 other agricultural products
0.9
0.9
112.5
100
Source: Calculated by the authors based on [16] Table 3 Agricultural exports in Kursk Region in 2018
Export type
Percentage
Food and processing industry
57.97%
Grains
38.73%
Fat and oil industry products
1.97%
Meat and dairy products
0.76%
Miscellaneous
0.57%
Total
100%
Source: Compiled by the authors based on [5]
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Fig. 2 The plan of agriculture digitalization. Source: Compiled by the authors based on [10]
4 Discussion Driven by state support, Kursk Region improves agricultural facilities, reorganizes the machinery, and develops the infrastructure. As we all know, the development of the production conditions entails an increase in output volumes, causing retained profitability. Seventy percent of the regional agricultural products cover the demands of the Kursk Region. The rest is exported to the regions of Russia, neighboring countries, and beyond. The industry harvests more than 50 tons of grain per ha, more than 450 tons of sugar beet per ha, and more than 160 tons of potatoes per ha. It is worth noting that without the introduction of new technologies for soil cultivation and parallel digitalization of processes, such indicators would be impossible to achieve, considering the current weather conditions. Modern crop control systems also allow determining the optimal timing of harvest. Some areas of the Kursk Region significantly increased their labor productivity and economic efficiency (by 30–40%) due to the implementation of digital technologies [15]. We note that the effects of digitalization do cover not only substantial agricultural holdings but also household farms, which allows them to remain competitive. Satellite navigation technology systems for monitoring vehicles and agricultural machinery have a particularly significant effect. Speaking on the use of electronic systems in the region, we should state that veterinary accompanying documents for products controlled by the State Veterinary Service are issued in electronic form within the Federal government information system “Mercury” [9]. Pilot projects on the use of the automated system of accounting
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and registration of farm animals “REGAGRO” [12] are being introduced in the territories served by the Regional budgetary institution “Kursk Animal Health Center” and the Regional budgetary institution “Animal Health Center of Belovsky district.” This will create a single database on the owner and animals with a unique number assigned to them. To ensure the sustainable implementation of modern digital technologies in the field of agriculture, we should also pay attention to the training of IT specialists [1]. It is important not only to improve the skills of existing specialists but also to create new specialties in agricultural universities focused on training specialists in the field of digital technologies for the AIC. Some experts believe that digital technologies should be involved in working with investors [7]. Kursk Region is already taking steps in this direction. The region also occupies a high position in terms of indicators marking the investment climate compared to other regions of the Russian Federation. The investment serves as the main source of growth within the region. The President of the Russian Federation has set a task for authorized district representatives and heads of subjects to ensure that the share of investments in fixed capital of gross regional products amounts to at least 25% [14]. Kursk Region takes the leading position in this indicator among 18 regions of the Central Federal District, with 28.8%. The increase in investment is due to the implementation of several projects in the AIC.
5 Conclusion Our research allows us to draw the following conclusions:
• The Kursk Region is accelerating the process of obtaining and improving the effectiveness of state support measures in the field of agriculture as a result of the use of digital technologies; • The region saw an increase in volumes and revenues from the sale of agricultural products on the domestic market; • The Kursk Region is increasing its export potential due to digitalization; • The region occupies one of the leading positions in Russia in the production of grain, sugar beet, potatoes, and meat. Thus, we can highlight further prospects for the development of the AIC in the Kursk Region, provided that digital technologies are developed, including increased crop yields, animal productivity, reduced production costs based on efficient use of resources, and scientifically based approaches, timely provision of critical information to agricultural producers.
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References 1. Alekseeva SA, Lomakin OE (2019) Formation of a professional portrait of a specialist of the AIC in the conditions of modernization of the agricultural sector of the economy. Manage Bus Adm 4:73–79 2. Anfinogentova AA, Dudin MN, Lyasnikov NV, Protsenko OD (2018) Providing the Russian AIC with highly qualified personnel in the transition to a green economy. Econ Reg 14(2):638– 650 3. Azzheurova KE, Bessonova EA (2015) Development of methods for analysis and assessment of the efficiency of regional investment projects seeking state support. Mediterr J Soc Sci 6:362–371 4. Dijkstra PT, Haan MA, Mulder M (2017) Industry structure and collusion with uniform yardstick competition: theory and experiments. Int J Ind Organ 50:1–33 5. Federal State Statistics Service (2019) Official website. https://www.gks.ru 6. Food and Agriculture Organization of the United Nations (2019) Official website. https://www. fao.org/home/ru/ 7. Khaiturina E, Kreneva S, Bakhtina T, Larionova T, Tsareva G (2018) Strategic benchmark of the digital economy in the regional AIC. Int Multidisc Sci GeoConf Surv Geol Mining Ecol Manage (SGEM) 18:767–774 8. Kharchenko EV, Shirokova LV, Shevchenko AC (2015) Integration of the model of state support of the program of import substitution in the mechanism of improving the investment climate in the region. SGEM Int Multidisc Sci Conf Soc Sci Arts 2–3:477–484 9. Mercury-Vetis (2019) Official website. https://mercury.vetrf.rz 10. Ministry of Agriculture of the Russian Federation (2019) Official website. https://mcx.ru 11. Muan A, Osborn EF (1965) Phase equilibria among oxides in steelmaking. Addison-Wesley Pub Co, Reading 12. National system of accounting and registration of animals “REGAGRO” (2019) Official website. https://regagro.ru 13. Popova LV, Dugina TA, Panova NS, Dosova AG, Skiter NN (2018) New forms of state support for the AIC in the digital economy conditions as a basis of food security provision. Adv Intell Syst Comput 622:681–687 14. Presidential Executive Office (2012) Decree “On long-term state economic policy” (No. 596. Put into effect on May 7, 2012), Moscow, Russia 15. Territorial Body of the Federal State Statistics Service for the Kursk Region (2019b) Kursk Oblast in figures. Statistical compendium. https://kurskstat.gks.ru/storage/mediabank/Kypcka oblactvcifpax2019.pdf 16. Territorial Body of the Federal State Statistics Service for the Kursk Region (2019a) Official website https://kurskstat.gks.ru.
Environmental Features of Hypersaline Lakes in the Regional Socio-Economic Development Svetlana V. Okrut , Vasiliy A. Komarov , Tamara G. Zelenskaya , Elena E. Stepanenko , and Victoria D. Drup
Abstract This study discusses the feasibility of using the mud of hypersaline lakes in the socio-economic development of the region. This paper defines the factors of the lake ecosystem affecting mud-forming processes. This paper defines the therapeutic properties of the lake sulfide mud and evaluates the economic efficiency of mud resource use in balneotherapy. This paper aims to study the hydrobiological features of salt lakes that form therapeutic mud and its use for balneotherapeutic purposes. The assessment of the salt lake resource potential is based on the materials of hydrobiological field studies, laboratory analyses, and the results of research conducted by medical institutions in the region. Data collection and analysis were conducted per GOST 31,86-2012 guidelines for collecting and processing materials for hydrobiological studies in freshwater reservoirs, and the guidelines for sanitary and microbiological analysis of therapeutic mud. The calculation of the economic efficiency of mud bath creation was performed on the basis of methodological recommendations for determining the economic efficiency of environmental protection measures in transport construction. Keywords Salt lake · Therapeutic mud · Balneotherapy · Environmental assessment · Artemia · Lake ecosystems
1 Introduction Unique ecosystems of hypersaline lakes marked with a high concentration of salts and an increased pH are currently subject to anthropogenic load with mass unorganized tourism, which requires a rational approach to the resource potential of these natural objects. The interest in the lakes is associated with the fact that these hypersaline reservoirs are considered to be relict. The relic species of Artemia Salina and Dunaliella salina inhabit the ecosystem and play an important role in forming silt processes. S. V. Okrut (B) · V. A. Komarov · T. G. Zelenskaya · E. E. Stepanenko · V. D. Drup Stavropol State Agrarian University, Stavropol, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_34
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The salt lakes of the Stavropol Krai attract a lot of attention. On the one hand, this is caused by the unique structure of its ecosystem; on the other hand, by their use in the socio-economic development of the region. The study of salt lake features corresponds to the strategic goals of water resources development in the Stavropol Krai and is a topical issue. The task of the regional government related to the development of preserved and protected areas within the territory of the region, as well as the creation of new recreational areas for balneotherapeutic purposes, adds to the importance of this issue [14]. Studies of the species composition, physical and chemical features of water (as well as mud and brine) allowed us to analyze the ecological state of not only salt waters and mud lakes but also their adjacent territories. Saltwater and therapeutic mud are key natural resources, and therefore are subject to careful accounting and control. The assessment of the current state of hypersaline lakes of the region and its adjacent territories in terms of their resort and recreational potential can determine the direction of rational use of natural therapeutic resources. The research object is Solyonoye Ozero, located on the territory of the Krasnogvardeysky District of the Stavropol Krai. The Stavropol Krai is rich in salt lakes. However, the only source of therapeutic mud for the resorts of the Caucasian Mineral Waters is the well-studied mud and brine of the Tambukan Lake saltwater. The hydrochemical and ecological features of the salt lake located in the Krasnogvardeysky District did not undergo a full study. This paper aims to study the hydrobiological features of salt lakes that form therapeutic mud and its use for balneotherapeutic purposes. The study presents the first comparative assessment of physicochemical parameters of silt sulfide mud of Tambukan Lake and salt lake located on the territory of the Krasnogvardeysky District. The paper presents a balneotherapeutic assessment of silt and considers the potential establishment of a therapeutic mud source on the territory of the district.
2 Materials and Methods The assessment of the salt lake resource potential is based on the materials of hydrobiological field studies, laboratory analyses, and the results of research conducted by medical institutions in the region. Data was collected and analyzed from 2017 to 2018. The chemical features of the lake brine were determined by the composition of soluble salts, soils, rocks adjacent to the lake, and changes occurring under the influence of chemical and biological processes. Brine sampling was performed using a Molchanov bathometer per GOST 31,8612012 (“Water. General requirements…,” 2012). We determined the temperature, pH,
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and total salinity of the water. The temperature was measured using a water thermometer; pH was measured using a pH-meter; total salinity was established using a pocket refractometer. The physical and chemical properties of mud were studied according to the brief outline of silt mud analysis [6]. The selection of hydrobiological samples and measurement of environmental factors was carried out according to standard methods [1, 9, 18]. The calculation of the economic efficiency of mud bath creation was performed based on methodological recommendations for determining the economic efficiency of environmental protection measures in transport construction [2].
3 Results and Discussion In this study, we carried out the geochemical assessment of the lake ecosystem resource potential. The research established that the lake bottom consists of evenly distributed layers of silt, reaching 10 m in depth. The maximum depth of the lake during the rainy season reaches 60 cm. Underground and rain waters are the main sources of the lake feeding. There is some suggestion that the lake has a source of deep feed. Saltwater from the East Kuban basin is deposited into the lake through cracks or aquifers. The brine of the lake is similar to most of the lakes of the Stavropol Krai. The water contains up to 280 mg/l of calcium and 202 mg/l of magnesium. The species composition of the lake is represented by two species – Artemia Salina and Dunaliella salina. The visual inspection noted that the external features of mud collected in three different points are the same. It is black in color and has a pronounced smell of hydrogen sulfide. The mud is viscous, contains elements of sand, plankton, and gypsum crystals. It changes color to gray when exposed to air. Secondary literature indicates that the black color of the mud is caused by the presence of iron sulfide, which changes the color to gray when exposed to air. Hydrogen sulfide is one of the main components determining the bactericidal properties of dirt. In the course of the research, samples of Solyonoye Ozero mud were compared with physical and chemical indicators of the silt sulfide mud of Tambukan Lake. The results are presented in Table 1. The table demonstrates the similarity of several physical and chemical parameters of mud within Solyonoye Ozero with the physical and chemical parameters of the silt of Tambukan Lake. According to the data of G. V. Vulf [16], the silt properties of Solyonoye Ozero are close to the properties of therapeutic mud of the Tambukan Lake and, as a result, the silt has medicinal properties. The confirmation of this statement is reflected in the results of analyses of water-soluble parts of the lake mud (Table 2). Dirt microorganisms, including cyanobacteria process the salts of the lake water, and therefore the solution permeating the mud differs significantly in composition from the lake water.
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Table 1 Physical and chemical parameters of silt sulfide mud Parameters
Dimension
Silt muds norm
Tambukan Lake
Solyonoye Ozero
Humidity
%
54
46
Volume weight
g/cm2
1.1–2.0
1.2
1.2
Adhesiveness
dyn/cm2
–
1,522
2,145
Heat capacity
cal\g grad
0.3–0.8
0.6
0.4
7.0–7.9
7.6
7.3
0.15–0.50
0.4
0.2
1.04
0.9
Environmental reaction (pH) Hydrogen sulfide gen
% on nat. substance
Iron sulfide
25–75
Analysis result
–
Source Compiled by the authors
The analysis of water-soluble parts of the lake mud and brine analysis of the lake is demonstrated in Table 3. Table 3 shows that the total amount of alkalis remains almost unchanged, both in water and in the water-soluble part of the mud. The decrease in SO3 , CaO, and MgO in water permeating the mud is due to the vital activity of organisms that, on the one hand, restore sulfuric acids, on the other hand, emit carbon dioxide, which converts soluble sulfuric acid and chloride compounds of calcium and magnesium into insoluble carbon dioxide, which does not transfer into the water extract. Changes in the salt regime and formation of the silt layer are related to the biological component of the lake ecosystem [4]. When studying the environmental features of the Solyonoe Ozero, we noted that the beaches and shallow waters are covered with a thick layer of silt (black mud). We also observed salt deposits located at a greater distance from the water surface. Artemia salina is one of the biogenic components synthesizing organic substances that form the salt lake mud post-death [5, 11, 15]. Literature analysis shows that the mud of salt lakes belongs to silt sulfide deposits. It was established that the absorption capacity of saline lakes silt is expressed in the absorption of harmful, pathogenic flora. Water extracts of silt mud contain a bacteriophages that can absorb pathogens such as staphylococci, dysentery Escherichia coli, and Proteus. They also contain penicillin-like strains of mold, follicle-like substances that enter the body by absorption through intact skin. It is assumed that the complex lipid composition of sulfide deposits is the result of algae activity [3, 7, 10, 12, 13]. The mud also contains putrefactive aerobes and anaerobes, sulfate-reducing and denitrifying bacteria, mold, ray, and yeast fungi. The study of Solyonoye Ozero determined that the silt has a soft moldable consistency that is easily washed off by the brine. The atmospheric waters carry sand and clay from the elevated terrace into the lake. Sand is deposited closer to the shore, clay is carried further into the lake, so the mechanical properties of lake silt located near
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Table 2 The analysis of water-soluble parts of lake mud Indicator
In % per liter of water extract
In % per 100 g raw mud
In % per 100 g dry mud (105 °C)
Solids
2.488
0.100
0.184
Ash residue
2.388
0.096
0.176
Loss during calcination
0.100
–
–
Total alkalinity (HCO3 )
0.275
0.011
0.020
Indefinite alkalinity (NCO3 )
0.114
0.005
0.009
Alkalinity expressed in 0.214 Ca(HCO3 )2
0.009
0.017
Silica (SiO2 )
0.030
0.0012
0.0022
Fe2 O3 + Al2 O3
0.019
0.0008
0.0015
Iron oxide (Fe2 O3 )
0.002
0.0001
0.0002
Phosphorus oxide (P2 O5 )
Traces
Traces
Traces
Calcium oxide (CaO)
0.015
Traces
0.001
Magnesium oxide (MgO)
0.070
0.003
0.006
Potassium oxide (K2 O)
0.124
0.005
0.009
Sodium oxide (Na2 O) 0.886
0.035
0.064
Chlorine (Cl)
0.697
0.028
0.051
SO3
0.612
0.024
0.44
pH
Slightly alkaline
Extract color
Colorless
Source [16] Table 3 The analysis of the lake water
Element
Lake water
Water-soluble part of the mud
Cl
100
100
SO3
120
86
Na2 O
132
127
3
17
K2 O CaO
4
1
MgO
17
10
Source [16]
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Table 4 Indications for external usage of silt mud Indications for external use
Form of use
Diseases of the musculoskeletal system General mud applications chronic infectious non-specific (rheumatoid) Local mud treatments include limb baths, mud arthritis, polyarthritis in remission; applications to a limited area – the effects of brain and spinal cord trauma with moderate-to-severe movement disorders without abnormalities of the pelvic organs and epileptiform seizures in recent history; – occupational diseases of the digestive system associated with work in the gas chemical industry or mines (lead, copper, zinc, etc.); – vibration disease of various distribution and origin Chronic diseases of peripheral blood vessels; – endarteritis of spastic, sclerotic, and mixed etiology without severe pain syndrome and far-reaching trophic disturbances of tissue (necrotic changes) – varicose veins of the lower extremities with the presence of edema of the legs and feet, early lymphostasis (elephantiasis)
Mud applications should only be used by segmental type
Chronic diseases and metabolic disorders; Local mud treatments include baths, mud – gout with deformity and pain in small joints applications to a limited area of the hands and feet, with limited function; – obesity of all degrees in combination with diseases of joints and digestive organs, with the preserved function of the cardiovascular system without the presence of hypertension; – metabolic diseases of peripheral nerve trunks Chronic disease of the skin; – psoriasis of limited localization without exacerbation; – chronic eczema (dry), occupational dermatosis, pustular skin diseases in limited areas
General mud applications Local mud treatments
Chronic diseases of the female genital organs of an inflammatory and functional nature: residual phenomena and consequences of inflammation of the uterus and its appendages
General mud applications Local mud treatments
Source [8]
the shore are not similar to silt located further away from it. The silt located further from the shore is more moldable, whereas the shore silt contains sand particles. The results of the physical and chemical analysis demonstrated the possibility of using mud for medicinal purposes. Research conducted by medical institutions in the area also confirmed the possibility of using silt mud for balneotherapeutic purposes. Based on these results, indications for use were developed in accordance with the forms of use (Table 4).
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The analysis of the potential natural resource usage assumes its rational use.
4 Economic Efficiency Based on the analysis of data of research and materials provided by medical institutions of the district, the scholars calculated the economic efficiency of Solyonoye Ozero mud usage for residents of the Krasnogvardeysky District, as well as neighboring districts of the Stavropol and Krasnodar Krai, the Rostov Region, and the Republic of Kalmykia. The rural locality of Krasnogvardeyskoye was chosen because it is relatively close to its neighbors. It occupies a central place, which is confirmed by the data in Table 5. The list of ailments that can be treated with the lake mud of Solyonoye Ozero in the Krasnogvardeysky District on the basis of analogy with Caucasian Mineral Waters mud baths is presented in Table 6. As can be seen from the table, 40% of the district residents have diseases that can be successfully treated with the lake mud of Solyonoye Ozero. Since neighboring districts are located within the same conditions as the study area, it can be assumed that this percentage of residents is close to the indicators of the seven neighboring districts. Using data from Table 7, 8, 9, and 10, we calculated the treatment cost for a hospitalized patient in a mud clinic of the Krasnogvardeysky District. In order to create a mud clinic and implement treatment, the following staff of specialists is required. The cost of similar treatment in Caucasian Mineral Waters amounts to 35,000.00 to 55,000.00 RUB. Table 5 The distance from the rural locality of Krasnogvardeyskoye to the centers of neighboring districts No.
Name of the district center
1
Novoalexandrovsk
50
1
2
Gorodovikovsk
60
1
3
Ipatovo
120
2
4
Izobilny tow
90
5
Donskoe
60
1
6
Peschanokopskoe
60
1
7
Belaya Glina
70
1.5
Source Compiled by the authors
Distance to Krasnogvardeyskoye (km)
Travel time to Krasnogvardeyskoye (hour)
1.5
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Table 6 Population demand for treatment No. Name of the disease
Number of residents in need Percentage of the population of treatment of the district with these diseases
1
Diseases of the musculoskeletal system
10,500
25
2
Spinal cord diseases
3
Diseases of bones, muscles, and tendons
4
Diseases of the nervous system
2,100
5
5
Male and female 2,100 reproductive system diseases
5
6
Urological diseases
2,100
5
7
Total
16,800
40
Source Compiled by the authors Table 7 The number of residents in need of mud treatment in neighboring areas No.
Name of the district
Total number of residents (people)
In need of treatment (people)
1
Krasnogvardeysky
42,000
16,800
2
Ipatovsky
66,900
26,760
3
Izobilnensky
100,600
40,240
4
Novoalexandrovsky
65,200
26,080
5
Trunovsky
34,800
13,920
6
Gorodovikovsky
19,000
7,600
7
Peschanokopsky
36,000
14,400
8
Beloglinensky
33,000
13,200
Total:
397,500
159,000
Environmental Features of Hypersaline Lakes ...
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Table 8 The necessary staff for the organization of mud baths at the Central Regional Hospital of Krasnogvardeyskoye No.
Qualification
1
Physician (highest category)
2
Wage (RUB)
Annual wage (RUB)
1
32,600
391,200
Nurse
4
18,278
877,344
3
Unlicensed assistive personnel
5
12,130
727,800
4
Engineer
1
15,147
181,764
5
Laborer
2
12,130
291,120
6
Metalworker
2
12,130
291,120
7
Electrician
1
12,130
145,560
8
Machinist
2
12,130
291,120
9
Medical Record Administrator
1
12,130
145,560
10
Laboratory Technician
1
14,257
171,084
11
Driver
1
12,130
145,560
12
Operator
1
12,130
145,560
Total:
Number of staff units
22
3,804,792
Source Compiled by the authors Table 9 The cost of mud treatment procedures of day hospitalization No.
Procedure name
Procedure price (RUB)
Course price
1
Electric mud treatment
280.00
2,800.00
2
Gynecological treatment
300.00
3,000.00
3
Mud application
700.00
7,000.00
4
Mud treatment of the lower extremities
700.00
7,000.00
5
Full mud bath
800.00
8,000.00
Source Compiled by the authors Table 10 The cost of mud clinic treatment for a hospitalized patient Average daily hospitalization cost Time of treatment (days) The cost of the package with 10% (RUB) profitability (RUB) 1,300.00 Source Compiled by the authors
21
27,300.00
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5 Conclusion During the research of the ecological features of Solyonoye Ozero, we noted that the beaches and shallow waters are covered with a thick layer of silt (black mud) and observed a salt deposit at a greater distance from the water surface. Artemia salina is one of the biogenic components synthesizing organic substances that, upon its death, forms the salt lake mud. Silt mud of Solyonoye Ozero is highly mineralized and sulfide-rich. It can be used for medicinal purposes. Usage of Solyonoye Ozero resource potential for residents of adjacent territories for balneotherapeutic purposes is cost-effective.
References 1. Abakumova VA (1983) Guidelines for methods of hydrobiological analysis of surface waters and bottom sediments. Hydrometeoizdat, Leningrad, USSR 2. All-Union Research Institute of Transport Construction (1986) Methodological recommendations for determining the economic efficiency of environmental protection measures in transport construction. USSR, Moscow 3. Belkinova D, Padisák J, Gecheva G, Cheshmedjiev S (2014) Phytoplankton based assessment of the ecological status of Bulgarian lakes and comparison of metrics within the water framework directive. Appl Ecol Environ Res 12(1):83–103 4. Brylev V (2019) Russian saline lakes Elton and Baskunchak as challengers to the UNESCO World Heritage List. Folia Geographica 61(1):87–97 5. Chaban VV (2012) Application of the Artemia salina bioindicator in the ecological study of salt lakes of the Crimean Peninsula. Constr Tech Safety 43:102–105 6. Ministry of Health (1991) Guidelines for sanitary and microbiological analysis of therapeutic mud. Ministry of Health, Moscow 7. Kolpakova MN, Gaskova OL, Naymushina OS, Vladimirov AG, Krivonogov SK (2019) Saline lakes of Northern Kazakhstan: geochemical correlations of elements and controls on their accumulation in water and bottom sediments. Appl Geochem 107:8–18 8. Ministry of Health of the Russian Federation (2000) Guidelines 2000/34. Classification of mineral waters and therapeutic mud for the purposes of their certification, Moscow, Russia. 9. National Research Institute of Lake and River Fisheries (1983) Guidelines for collecting and processing materials for hydrobiological research in freshwater reservoirs Zoobenthos and its products. USSR, Leningrad 10. Nekipelova AV (2016) Influence of therapeutic mud on the improvement of patients with chronic dermatosis. Health Educ Millennium 7:68–71 11. Okrut SV, Pospelova OA, Komarov VA (2017) Ecological features of salt lakes in Stavropol Krai. Priority directions of science and education development. In: Gulyaev GY (ed) Nauka i Prosveshchenie, Penza, Russia 12. Roques C-F, Queneau P (2016) SPA therapy for the pain of patients with chronic low back pain, knee osteoarthritis, and fibromyalgia. Bulletin De l’Académie Nationale De Médecine 3:575–587 13. Tasova AN, Shchetinina TA (2015) Salt composition of therapeutic mud of Astrakhan Region. Theoret Appl Asp Modern Sci 8(1):95–97 14. Government of the Stavropol Krai (2017) Resolution of the Government of Stavropol Krai “On amendments to the state program of Stavropol Krai “Environmental Protection” approved by the resolution of the Government of Stavropol Krai of December 25, 2015, No. 572-p (October 19, 2017 No. 414-p), Stavropol, Russia
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15. Trigui K, Said RB, Et Néji Aloui FA (2016) Eco-biological study of artemia salina (Branchiopoda, Anostraca) in Sahline Salt Lake (Tunisia). Crustaceana 89(8):949–974 16. Vulf GV, Sinkevich IK, Ronzhin IN, Ivanchin-Pisarev AA (1918) Salt lakes of the Western and South-Western part of Stavropol Governorate. Hydrogeolical department of Stavropol Governorate, Stavropol, Russia 17. Water. General requirements for sampling. GOST 31861-2012 (15 November 2012) Interstate Council for Standardization, Metrology, and Certification, Moscow, Russia 18. Zhadin VI (1960) Methods of hydrobiological research. Vyshaya Shkola, Moscow, USSR
Intensity of Agricultural Land Use and Land Market Activities in the Central Economic Region in Russia Vasiliy I. Nechaev , Galina N. Barsukova , Natalia R. Saifetdinova , Lyudmila I. Khoruzhy , and Pavel V. Mikhaylushkin
Abstract The record shows that the intensity of agricultural land use in the Central Economic Region is lower than in the Central Chernozem Economic Region of the Central Federal District of the Russian Federation. This data is confirmed by the indicators of the significant reduction in the area of agricultural land, the low specific weight of crops in arable land, and the low cost of gross average output received per one ha of agricultural land in the region. The agricultural land market in the Central Economic Region is higher than in the Central Chernozem Economic Region, which is primarily due to the high demand for residential real estate near the capital and major cities of the district, which also encourages the transfer of agricultural land to other categories and uses. Differences in prices for agricultural land between areas of the Central Economic Region are caused mainly by the differences in socio-demographic factors and their proximity to Moscow and Moscow Region. The average size of a land plot for purchase and sale in the areas of the Central Economic Region bordering the Moscow Region is less than in the non-bordering areas. Transactions involving large land plots predominate in the market circulation of agricultural land in the Central Economic Region. Patterns of price formation for such plots determine the average specific indicator of prices for agricultural land in the areas of the region. Keywords Agricultural land · Land market · Market price · Pricing factors · Central economic region
V. I. Nechaev (B) · P. V. Mikhaylushkin Federal Research Center of Agrarian Economy and Social Development of Rural, Areas – All Russian Research Institute of Agricultural Economics, Moscow, Russia G. N. Barsukova · N. R. Saifetdinova Kuban State Agrarian University Named After I. T. Trubilin, Krasnodar, Russia L. I. Khoruzhy Russian State Agrarian University – Moscow Timiryazev Agricultural Academy, Moscow, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_35
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1 Introduction Currently, most regions do not have a developed system of promoting the use of agricultural land and agricultural production, which steadily leads to a reduction in the economic use of agricultural land [5]. In this paper, we form several hypotheses: • The activity in the market of agricultural land differs significantly across the Federal districts of Russia, economic regions, and their constituents. It depends on the intensity of agricultural land use. • The level of market prices for agricultural land also differs significantly across the regions of the Federal Districts of the Russian Federation in the context of economic regions. • Differences in prices for agricultural land between regions are largely caused by the differences in socio-demographic factors and the proximity of the regions to Moscow and the Moscow Region. The research aims to analyze the intensity of agricultural land use in the Central Economic Region [CER] in comparison with the Central Chernozem Economic Region [CCER] of the Central Federal District [CFD].
2 Materials and Methods It is widely assumed that the land market activity and land value are affected by a combination of factors such as natural-climatic, organizational-economic, and demographic features of the region. The factors also include spatial, quantitative, and qualitative features of the land, proximity to transport routes, social infrastructure, social and demographic conditions, income levels, and investment policy within the region [3, 4, 6]. Patterns of market price formation for agricultural land plots and their turnover activity depending on various factors can be identified by using methods of correlation and regression-statistical analysis [2]. The research methodology was tested on the materials of the CER of CFD, presenting particular interest for the study due to their climatic conditions and, to a greater extent, the socio-economic features attributable to their proximity to Moscow.
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3 Results and Discussion 3.1 The intensity of agricultural land use in the CER of the CFD The CFD produces about 25% of the total agricultural product value, while 19% of the Russian Federation’s arable land is concentrated within this district. In 2016, crop production accounted for 55% of the total agricultural production value, while livestock products accounted for 45%. The total area of CER agricultural land is 1.4 times larger than the agricultural land area located in CCER (Table 1). A comparative analysis of the agricultural land structure by economic region shows a significantly lower intensity of agriculture in the CER than in the CCER. For example, the share of arable land in the CER amounts to 60.2%, the share of forage land (hayfields and pastures) amounts to 28.5%, while the same indicators for CCER demonstrate 77.4% and 20.8%, respectively. The redistribution of land that took place during the reforms and the increase in the number of proprietors, owners, and users of land plots did not contribute to improving the land-use efficiency. Every year, more and more land is taken from Table 1 The intensity of agricultural land use in the economic regions of the CFD, 2016 Indicators
CFD
Economic regions CER
CCER
Area of agricultural land, thousand ha, total
33,212
19,881
13,331
Including arable land
22,296
11,976
10,320
Idle land
445
392
53
Perennial plantings
520
339
181
Hayfields
2,574
2,007
567
Pastures
5,879
3,668
2,211
Specific weight of crops in the area of arable land, %
64.7
47.6
86.0
Reduction of agricultural land from 2003 to 2015, thousand ha
−258.8
−228.4
−30.4
Agricultural products in current prices, total mln. RUB
746,258.9 300,605.3
445,653.6
in % of the CFD
100
40.3
59.7
per 1 ha of agricultural land
22.47
15.1
33.4
Agricultural land in private ownership, thousand ha 18,189
10,416
7699
The area under purchase and sale transactions, ha
231,536
66,670
2.22
0.87
298,207
The share of the under-transactions area in the total 1.6 area of agricultural land in private ownership, % Source [1]
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agricultural production. Over the period from 2003 to 2015, agricultural land in the CCER decreased by 30.4 thousand ha, which amounts to 12% of the total reduction of land in this category in the CFD, while the CER demonstrate a decrease amounting to 228.4 thousand ha involved in agricultural production (88% of the district’s land). The analysis of Table 1 allows us to conclude that agricultural production proves to be the most effective in the organizations of the CCER. This conclusion is facilitated by the indicators of significant agricultural land reduction in the period from 2003 to 2015 and the reduction of agricultural production per 1 ha of agricultural land in the CER. In 2016, the average gross output of CCER producers per 1 ha of agricultural land amounted to 33,4 thousand RUB, which is 2.2 times more than the value of this indicator for the CER. The CER agricultural land market is noticeably more active. The purchase and sale transactions are made over an area occupying 2.2% of all privately owned agricultural land. The interest in agricultural production in the region is decreasing. Some transactions on the land market are made with the aim of further withdrawal of land from agricultural turnover through changes in the category or features of the settlement, as well as through the establishment of a different permitted use type. This brings us to the conclusion that 228.4 thousand hectares of abandoned land and 5,700.5 thousand hectares of annually untilled arable land in the CER amount to 5929 thousand hectares, which can serve as a potential reserve for transfer to other categories of another use type.
3.2 Dependence of the Land Market Activity and Land Plots Price on Their Size and Location in the CER Areas of the CFD The study was performed separately for areas adjacent and non-adjacent to Moscow Region. The analysis of the agricultural land purchase and sale in the CER areas adjacent to the Moscow Region showed that the number of transactions varies on average from 122 ha in the Kaluga Region to 1010 ha in the Tula Region. However, the average sizes of land plots range from 4.7 ha in Yaroslavl Region to 412.3 ha in the Vladimir Region. The average size of the land plot of the purchase and sale exceeded 100 ha in all areas, except for the Tver, Yaroslavl, and Kaluga Regions. Grouping of land plots by area has shown that the maximum number of transactions is made in a group with an average plot size of more than 5 ha in all Regions, which allows us to conclude that the CER land market shows a predominant demand for larger land plots. Around 93% of the total area in circulation in the Yaroslavl Region (99% for Tula Region) falls into the group with areas exceeding 5 ha. The maximum size of land plots (in the group with areas exceeding 5 ha) with an area of 682.4 ha and the maximum number of transactions with such plots (569) were made in the Vladimir Region for the purpose of agricultural production. We note that the Vladimir Region is the farthest region from Moscow in the CER. The analysis also
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Table 2 The dependence of land market activity and price on the size of land plots in the CER areas bordering Moscow Region, 2015–2016 Region
Indicator
From 2.51 up to Exceeding 5.0 5.0 ha
78,707
4,772
1,327
3,980
0.18
4.11
46.99
4.67
The number of 534 transactions, units
24
57
615
***
3.3
3.4
93.3
100
Price, thousand RUB/ha
211,615
35,104
17,586
5,755
Average plot size, ha
0.81
3.5
76
26.6
The number of 250 transactions, units
60
158
468
***
1.63
1.69
96.67
100
Price, thousand RUB/ha
14,612.9
2,963.3
414
420
Average plot size, ha
0.47
4.27
136.61
112
The number of 65 transactions, units
19
386
470
***
0.1
0.15
99.75
100
Price, thousand RUB/ha
9,435.2
2,398.6
226.6
268.1
Average plot size, ha
0.04
3.35
107.42
60.49
The number of 38 transactions, units
16
68
122
Average plot size, ha
Ryazan
Kaluga
Tula
Vladimir
Total
Up to 2.5 ha Yaroslavl Price, thousand RUB/ha
Tver
Group of land plots in circulation with the size of the area
***
0.27
0.72
98.93
100
Price, thousand RUB/ha
9768
1748
16
28
Average plot size, ha
0.71
3.70
245.46
174.90
The number of 225 transactions, units
67
718
1010
***
0.1
0.1
99.8
100.0
Price, thousand RUB/ha
71879
4546
35
46.8 (continued)
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V. I. Nechaev et al.
Table 2 (continued) Region
Indicator
Group of land plots in circulation with the size of the area
Total
Up to 2.5 ha
From 2.51 up to Exceeding 5.0 5.0 ha
0.18
3.8
682.4
441.2
The number of 359 transactions, units
14
569
942
***
0.01
99.77
100
Average plot size, ha
0.02
*** The
specific weight of the area of the group’s plots in the total land area in turnover Source Compiled by the authors based on [1]
demonstrates a significant demand by the number of transactions for plots of up to 2.5 ha, the average size of which ranges from 0.04 ha in the Kaluga Region to 0.81 ha in the Tver Region. We concluded that these land plots are intended for gardening and individual housing construction. The results of the analysis also establish inverse proportional dependence of the market price of 1 ha on the size of the plot throughout all areas of CER. The maximum average market price of 1 ha amounting to 5,755 thousand RUB was observed in the Tver Region, while the minimum price was observed in Tula Region and amounted to 16 thousand RUB. The growth of the specific market price of land plots is mainly determined by their proximity to Moscow Region and their size. The growth of the population’s well-being in a number of the CER areas located near Moscow and Moscow Region ensures the emergence of solvent demand for suburban real estate. Unstable profitability and high capital intensity of agricultural production, in turn, contribute to the redistribution of agricultural land to other categories (Table 2). The average size of the land plot within the agricultural land market of the CER areas non-adjacent to the Moscow Region is significantly higher than in the adjacent areas (Table 3). All remote areas of the CER (in terms of their proximity to Moscow) demonstrate the following results. Around 89%–98% of the land area involved in turnover is included in the group where the maximum amount of land amounts to more than 75 ha. The land area has an average land size varying from 131.9 ha in the Smolensk Region to 356.7 in the Ivanovo Region. We can assume that these indicators mark the development of the land market for agricultural production. The analysis of Table 3 allows us to conclude that the average size of the land plot and its proximity to the Moscow Region significantly affect the formation of the market price. The increase in the average size of the plot is marked with a simultaneous pronounced tendency towards the decrease of the market price. The same trend in terms of the specific market price is observed depending on the proximity to the Moscow Region.
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Table 3 Dependence of land market activity and price on the size of land plots in the CER areas non-adjacent to Moscow Region, 2015–2016 Region
Bryansk
Ivanovo
Oryol
Kostroma
Indicator
Group of land plots in circulation with the size of the Total and on area average Up to 25 ha
From 25.1 to 50 ha
From 50.1 to 75 ha
From 75 ha
184.34
80.04
139.38
6.57
15.65
Average plot 10.46 size, ha
35.69
59.85
559.23
202.17
The number of transactions, units
43
23
8
37
111
***
2.00
3.66
2.13
92.21
100.00
Price, thousand RUB/ha
442.1
479.8
15.2
25.3
Average plot 7.8 size, ha
41.3
1185.0
356.7
The number of transactions, units
32
4
15
51
***
1.4
0.9
97.7
100.0
Price, thousand RUB/ha
1398.4
105.87
154.01
29.03
53.80
Average plot 7.89 size, ha
36.09
60.84
299.11
159.38
The number of transactions, units
68
42
23
127
260
***
1.30
3.66
3.38
91.67
100.00
Price, thousand RUB/ha
3896.1
1516.6
894.59
18.77
114.41
Average plot 9.24 size, ha
43.38
73.75
1362.4
334.10
The number of transactions, units
5
5
15
64
Price, thousand RUB/ha
39
(continued)
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V. I. Nechaev et al.
Table 3 (continued) Region
Smolensk
Indicator
Group of land plots in circulation with the size of the Total and on area average Up to 25 ha
From 25.1 to 50 ha
From 50.1 to 75 ha
From 75 ha
***
1.69
1.01
1.72
95.58
100.00
Price, thousand RUB/ha
21189.4
4562.3
220.9
178.0
1 067,1
Average plot 6.39 size, ha
36.37
60.50
1227.8
131.89
The number of transactions, units
63
16
6
9
94
***
3.25
4.69
2.93
89.13
100.00
*** The
specific weight of the area of the group’s plots in the total land area in turnover Source Compiled by the authors based on [1]
Agricultural organizations, farms, and agricultural holding structures that have financial opportunities to expand production purchase land plots for agricultural production purposes, including through population land shares buyup. Transactions with land shares of agricultural land should contribute to the concentration of land in the hands of the most efficient agricultural producers and ensure land consolidation.
4 Conclusion The interest in agricultural production in the CER is decreasing in comparison with the CCER. The level of the CER arable land use continuously reduced throughout the analyzed period of 2003 to 2015. The CER agricultural land decreased by 228.4 thousand hectares. The market for agricultural land in the CER is more active than in the agriculturally oriented CCER. Some transactions on the regional land market provide for further withdrawal of land from agricultural turnover. Differences in prices for agricultural land between regions are largely caused by the differences in socio-demographic factors, and the proximity of the regions to Moscow and Moscow Region. The main factors determining the price of a land plot are its size and location relative to Moscow and Moscow Region (in some cases relative to the regional center). Transactions conducted within the administrative districts of the areas bordering the Moscow Region are marked with a much smaller average size of land plots and a higher specific market price than the regional average.
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The average regional price level for land plots used for agricultural production is formed under the influence of pricing features for large land plots and the number of purchase and sale transactions for agricultural production. The revealed regularities confirm the assumption on various factors and features of agricultural land plots pricing under purchase and sale transactions on the secondary land market in different regions of the Russian Federation. Acknowledgements The study was funded by RFBR, project number 20-010-00079 A.
References 1. Federal Service for State Registration, Cadastre, and Cartography (n.d.) Official website. https:// rosreestr.gov.ru/site/ 2. Fois M, Fenu G, Bacchetta G (2018) Estimating land market values from real estate offers: A replicable method in support of biodiversity conservation strategies. Ambio, 1–11 3. Kiryushin VI (2014) Problems of the innovative development of agriculture. Innovations 7(189):3–11 4. Kiryushin VI (2019) The management of soil fertility and productivity of agrocenoses in adaptive-landscape farming systems. Eurasian Soil Sci 9:1130–1139 5. Nechaev VI, Barsukova GN, Saifetdinova NR (2019) Evaluating the market activity and pricing of agricultural land in the CCER of the Russian Federation. IOP Conf Ser Earth Environ Sci 274(1) 6. Nikonova GN (2016) Research on problems of land relations regulation in the agricultural sector. In: Altuhov VAI (ed) Methodological support for scientific research of economic problems of the Russian agro-industrial complex development. Kadrovy Reserv Fund, Moscow, Russia, pp 226–233
Achieving Sustainable University Development Based on the EFQM Model Implementation Elena V. Khokhlova , Valentina A. Ivashova , Rahima H. Malkarova , Azamat B. Sozaev , and Tatyana N. Shcherbakova
Abstract The paper reveals the practical experience of implementing the EFQM Model in the Stavropol State Agrarian University (Russian agricultural higher education establishment). The paper determines the role of this approach in improving the management of complex socio-economic systems based on the theoretical analysis of scientific literature. The paper confirms the improvement of the quality of services provided based on nurturing leaders, updating the strategy, developing employee potential, strengthening partnerships and resource base, focusing on the satisfaction of all consumer categories (students, employers, employees, and partner societies). The paper identifies and tests the success factors in implementing flexible management approaches. These factors are as follows: high receptivity of the University to innovations; modern means of communication; open nature of sociocultural interaction of employees, partners, consumers, and all concerned parties; principles of building an organizational structure. Keywords EFQM model · Leadership development · Strategy updating · Employee potential development · Partnership · Consumers · Business results · Good practice
1 Introduction The growing complexity of socio-economic systems, the increasing uncertainty in their stable functioning and development, and changes in technologies make it necessary to search for new management tools that would allow humanity to respond to the E. V. Khokhlova · V. A. Ivashova Stavropol State Agrarian University, Stavropol, Russia R. H. Malkarova · A. B. Sozaev Kabardino-Balkarian State University named after H.M. Berbekov, Nalchik, Russia T. N. Shcherbakova (B) Rostov Institute of Improving Teachers’ Qualification and Professional Retraining, Rostov-on-Don, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_36
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modern global and regional challenges effectively. The multilevel transformation of technological production, increasing digitalization, and scientific achievements also affected higher education system, which should anticipate future personnel training. Responding to the external environment changes and the needs of the modern labor market caused the academic community to try the EFQM Model—a universal tool for continuous improvement. The indisputable advantages of this model are as follows: • Versatility and usability in conjunction with the existing management system of Russian universities; • Continuous development of all processes in the organization; • Benchmarking and competitive comparisons for finding areas of main, principal, and supporting processes development; • Consistency of innovations and improvements embedded in the organization policy and strategic development vectors implementing the EFQM model; • Achievement of sustainable business results through high satisfaction of all consumers and personnel categories. The value of this model is proven by numerous successful organizations in Europe and the world, which represent various fields of activity. This demonstrates the particular relevance of studying the implementation of the EFQM Model in educational organizations.
2 Materials and Methods The paper aims to present the main approaches and best practices for achieving sustainable development of a university via the EFQM Model. To achieve this goal, we analyzed the documents on self-study of the Stavropol State Agrarian University, which were presented for participating in the EFQM GLOBAL EXCELLENCE AWARD (2008, 2010, 2013, 2016). We described the scientific discussion reflected in the publications of the Scopus abstract database. The main requirements for the quality of services are established in the Stavropol State Agrarian University under the laws “On Education in the Russian Federation,” “On Science and State Scientific and Technical Policy,” as well as the requirements of national educational standards and the University Charter. Implementing the EFQM Model is necessary to achieve sustainability of the University development and maintain the education quality stated in the mission of Stavropol State Agrarian University. Education quality is continuously increased via the following approaches: nurturing leaders, updating the strategy, developing employee potential, strengthening partnerships and resource base, focusing on the satisfaction of all categories of consumers (students, employers, employees, and partner societies). The paper identifies and tests the success factors in implementing flexible management approaches. These factors are as follows: high receptivity of the
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University to innovations; modern means of communication; open nature of sociocultural interaction of employees, partners, consumers, and all concerned parties; principles of building an organizational structure.
3 Results The EFQM model implementation in the Stavropol State Agrarian University over 20 years has passed several successful stages of participation in the EFQM GLOBAL EXCELLENCE AWARD. The University became the award winner on three separate occasions (2016, 2013, and 2010). It received a Platinum level of Excellence in the “Education” sector of the EFQM Global Excellence Index (the 1st place among educational organizations worldwide in 2017–2019). This EFQM Excellence Award is a prestigious European award for business excellence of organizations. Flexible management organizational advantages at times of significant structural and technological changes in socio-economic systems. The Stavropol State Agrarian University used the following approaches when implementing the EFQM Model: • • • • • • • • • • • •
The optimal ratio of centralization and decentralization; Professional regulation through specifying goals and responsibilities; Reduction of management levels; Diagnostics of innovative activity of the Stavropol State Agrarian University; Continuous improvement and re-engineering of principal and supporting processes; The development of a management model of the Stavropol State Agrarian University based on process innovation; The constant reproduction and enrichment of the sociocultural field of excellence of the Stavropol State Agrarian University through interaction with partners, stakeholders, consumers; The encouragement of discussion, consultation, and involvement of personnel in decision-making; Building strategic business networks based on ethical and professional standards; Increasing the information presence of the Stavropol State Agrarian University through professional communications, the Internet, and network messages; The openness of internal and external communication channels; The accumulation of information resources and the creation of a single interactive information space.
Table 1 shows the levels of organizational flexibility of the Stavropol State Agrarian University and the factors ensuring the flexibility of the organization. The strategy of the Stavropol State Agrarian University is based on ensuring continuous sustainable development, following traditions, creative use of long-term experience, and the existing system of values reflected in the mission and vision of the University. The Stavropol State Agrarian University implements three main
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Table 1 Levels of organizational flexibility of the Stavropol State Agrarian University Level of organizational flexibility
Factors ensuring the flexibility of the organization
Strategic
Internal strategic flexibility Highly qualified personnel Stable financial situation Modern scientific and educational technologies Quality of equipment, buildings, and structures Intra-organizational coordination of resources External strategic flexibility Stable long-term relationships with stakeholders Diversification of activities distributing environmental risks Analysis system and response to changes in the external environment
Operational
Values, beliefs, and behavior patterns of employees aim to unite the personnel and motivate them to work together effectively Technical restructuring and upgrading of productive capacities, application of new equipment and technologies The use of the balanced system of the Stavropol State Agrarian University performance indicators to reduce operational strategy in line with other strategies
Situational
The system for timely diagnostics and feedback on situations The efficiency of management decision-making and consistency in the organization of key and supporting processes Variability in the use of resource potential
Source Developed by the authors
strategic approaches: compliance, continuous improvement, and breakthrough solutions fitting the criteria of the EFQM Model. The strategic compliance vector is based on setting quality requirements for products and services. This is a mechanism allowing one to set correct priorities in order to win the trust of consumers and partners and successfully compete in the domestic and foreign markets. The strategic vector of continuous improvement provides for creating a corporate environment promoting the involvement of people in the processes of development and resource-saving. Breakthrough strategies involve adopting ambitious decisions, radically changing the external and internal environment by senior management. The decisions should be aimed at managing processes and developing projects designed
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to achieve the established goals. This means participating in large-scale competitions, setting goals for continuous quality improvement, objectively assessing own advantages and potential, and timely identifying problem areas. To respond to internal and external challenges effectively, the University has developed a leadership nurturing system, which has ensured its transition to innovative development. The implementation of innovative projects requires highly qualified personnel, unconventional ideas, new approaches of young leaders with new professional vision, flexibility, and a high level of ambition. The results of a personnel survey taken by 94.8% of the Stavropol State Agrarian University employees allowed listing the most important leadership competencies for the development of the University. The ranking showed that the five most important leadership competencies are as follows: the ability to motivate, inspire, convince (66.7%); purposefulness, perseverance (52.5%); the ability to lead people (47.1%); charisma (43.5%); self-confidence (24.9%). The University personnel is involved in improvement processes at all levels of management. The human resources development formulated in the strategy aims to support the initiative and personal contribution of the employee in achieving the strategic goals of the University, creating equal opportunities for their professional and personal growth. The personnel work largely determines the high level of satisfaction of all consumer categories of the University services (educational, R&D, consulting, and other related services). Consumer, partner, and public relations of the University are based on the following approaches: customer-oriented approach in developing new offers, maintaining personal communications with the target groups, involving stakeholders in the sociocultural practices of the University, comprehensive study of consumer expectations. According to the annual monitoring results, the level of satisfaction of various consumer categories exceeds 90.0%. An example of this is demonstrated in the level of satisfaction of the top strategic partner management of the Stavropol State Agrarian University with the results of joint activities, shown in Table 2. The table shows a positive trend, demonstrating an increase in satisfaction of the top management of the strategic partners with the results of joint activities. The indicator steadily exceeds the level of 90.0%. Thus the analysis of results confirms the improvement of the quality of services provided based on nurturing leaders, updating the strategy, developing employee Table 2 The satisfaction of the top strategic partner management of the Stavropol State Agrarian University with joint activities results, % Indicators
2014
2015
2016
2017
2018
2019
Target level
90.0
91.0
92.0
93.0
94.0
95.0
Attained level
90.4
91.5
93.6
94.9
95.8
97.1
Source Developed by the authors
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potential, strengthening partnerships and resource base, and focusing on the satisfaction of all consumer categories (students, employers, employees, and partner societies). It gives a general idea of the best practices for achieving the sustainable development of the university via the implementation of the EFQM Model.
4 Discussion A brief two-year review of the literature performed using the Scopus abstract knowledge base demonstrates the relevance of implementing the EFQM model in organizations of various types and working in different socio-economic systems. L. A. Henriquez and V. A. Henriquez (2019), in their work “Proposal for implementation of the EFQM model at the University of Guayaquil based on the literature review,” analyzed the possibilities and advantages of using the EFQM model in the management system of a modern University. The scholars concluded that this model can be used as a supplement to the existing management system and is important for conducting self-assessment of the organization and searching for relevant areas of improvement and development vectors. This thesis is also relevant for several publications [7, 8], Hidirollu, 2019; [19]. D. Kafetzopoulos, K. Gotzamani, and D. Skalkos, in the paper “The relationship between EFQM enablers and business performance: The mediating role of innovation,” prove that high quality and constant innovation directly affect business performance. The production management must constantly strive to improve the quality of products and implement innovations to achieve outstanding results for the organization [12, 13, 20]. The EFQM model is actively implemented in the electric power industry. Examples of successful practices are presented in such publications as “A Fuzzy Multilayer Assessment Method for EFQM” [5] and “EFQM model for the overall excellence of Indian thermal power generating sector” [6]. According to several scholars, in implementing the EFQM model, it is important to use the multi-layer assessment method, including the expert evaluation and a balanced set of indicators independently offered by the organization within the framework of the structural elements of the model and fundamental concepts due to the industry specifics [2, 15, 18]. These approaches to implementing the EFQM Model are also relevant in high-tech manufacturing, as indicated by E. P. Paraschi, A. Georgopoulos, and P. Kaldis in their publication “Airport Business Excellence Model: A holistic performance management system” [17]. This information is essential for understanding the quality of training of engineering graduates in the Stavropol State Agrarian University. These specialists will later work in the power generating enterprises and agrotechnological businesses of the region. The implementation of the EFQM model makes it possible to ensure the stability of the enterprise in various socio-economic conditions, including extreme ones (Zhang, Li, Xia, Deng & Jin, 2019). Good practices in ensuring sustainability are presented in
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“Recognizing dissimilarities between resilience engineering and EFQM approaches to ensure safety in hospitals” [1, 21]. It is important to articulate the role of corporate social responsibility in the EFQM model implementation process. This aspect is particularly important for universities because graduates entering production will have competencies that ensure the transmission of the corporate social responsibility value into the organizational culture of enterprises. These provisions are reflected in the scientific work “Top executives’ perceptions of the inclusion of corporate social responsibility in quality management” [16]. Other scholars also elaborated on this topic [3, 4, 11, 14]. Thus, the nature of scientific discussion confirms the relevance of implementing the EFQM Model for achieving sustainable development of organizations of different types, sizes, spheres of activity, and the nature of the socio-economic environment. The University management system can be successfully supplemented with the approaches inherent to this model and produce outstanding results.
5 Conclusion We can draw several conclusions marking the achievement of the university sustainable development based on the implementation of the EFQM Model. The implementation process demonstrates its universality and the possibility of using it in addition to the existing management system in Russian universities; it encourages improvements in all processes within the organization through benchmarking comparisons and competitive events; it ensures the consistency of innovations and improvements embedded in the policy and strategic vectors of the organizational development. It helps to achieve sustainable business results through high satisfaction of all consumers and personnel categories. The analysis of publications of the Scopus abstract database confirms the relevance of implementing the EFQM Model for achieving sustainable development of organizations of different types, sizes, spheres of activity, and the nature of the socioeconomic environment. The University management system can be successfully supplemented with the approaches inherent to this model and produce outstanding results. The paper identified and tested the success factors in implementing flexible management approaches. These factors are as follows: high receptivity of the University to innovations; modern means of communication; open nature of sociocultural interaction of employees, partners, consumers, and all concerned parties; principles of building an organizational structure. The paper highlights the levels of organizational flexibility of the Stavropol State Agrarian University (strategic, operational, situational) and factors ensuring the flexibility of the organization.
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References 1. Asadzadeh SM, Tanhaeean M, Abdi N (2019) Recognizing dissimilarities between resilience engineering and EFQM approaches to ensure safety in hospitals. Hum Fact Ergon Manuf 29(3):233–252 2. Bagheri F, Noorossana R, Najmi M (2019) The extent of EFQM effectiveness in routine and non-routine organizations based on multivariate techniques: an empirical study. Oper Res Int J 19(1):237–267 3. Calvo-Mora A, Domínguez-CC M, Criado F (2018) Assessment and improvement of organisational social impact through the EFQM Excellence Model. Total Qual Manag Bus Excell 29(11–12):1259–1278 4. Dahlgaard-Park SM, Reyes L, Chen C-K (2018) The evolution and convergence of total quality management and management theories. Total Qual Manag Bus Excell 29(9–10):1108–1128 5. Daniel J, Naderpour M, Lin C-T (2019) A fuzzy multilayer assessment method for EFQM. IEEE Trans Fuzzy Syst 27(6):8481412, 1252–1262 6. Dubey M, Lakhanpal P (2019) EFQM model for overall excellence of Indian thermal power generating sector. TQM J 31(3):319–339 7. Escrig-Tena AB, Garcia-Juan B, Segarra-Ciprés M (2019) Drivers and internalisation of the EFQM excellence model. Int J Qual Reliabil Manage 36(3):398–419 8. Gómez-López R, Serrano-Bedia AM, López-Fernández MC (2019) An exploratory study of the results of the implementation of EFQM in private Spanish firms. Int J Qual Reliabil Manage 36(3):331–346 9. Henriquez LA, Henriquez VA (2019) Proposal for implementation of the EFQM model at the University of Guayaquil based on the literature review. Espacios 40(29):22 10. Hidiroˇglu D (2019) Self-assessment performance measurement in construction companies: an application of the EFQM excellence model on processes and customer stages. Procedia Comput Sci 158:844–851 11. Ivashova VA, Dukhina TN, Tarasova SI, Kalugina EN, Taranova EV (2014) The views of employers on the maturity of universal professional skills of young specialists of the Russia’s agricultural sector (an example of Stavropol territory). Life Sci J 11(9):326–329 12. Kafetzopoulos D, Gotzamani K (2019) Investigating the role of EFQM enablers in innovation performance. TQM J 31(2):239–256 13. Kafetzopoulos D, Gotzamani K, Skalkos D (2019) The relationship between EFQM enablers and business performance: the mediating role of innovation. J Manuf Technol Manag 30(4):684–706 14. Laurett R, Mendes L (2019) EFQM model’s application in the context of higher education: A systematic review of the literature and agenda for future research. Int J Qual Reliabil Manage 36(2):257–285 15. Malekzadeh R, Mahmoodi G, Abedi G (2019) Performance assessment of sari imam khomeini hospital applying EFQM excellence model and operational planning. J Mazandaran Univ Med Sci 29(177):157–165 16. Neri S, Pinnington AH, Lahrech A, Al-Malkawi H-AN (2019) Top executives’ perceptions of the inclusion of corporate social responsibility in quality management. Bus Ethics 28(4):441– 458 17. Paraschi EP, Georgopoulos A, Kaldis P (2019) Airport Business Excellence Model: a holistic performance management system. Tour Manage 72:352–372 18. Raziei S (2019) EFQM excellence model based on multi-criteria processes fuzzy ahp, fuzzy dematel, fuzzy topsis, and fuzzy VIKOR; A comparative survey. Int J Sci Technol Res 8(4):248– 260 19. Santos RS, Abreu AJPDCF (2019) EFQM model implementation in a Portuguese Higher Education Institution. Open Eng 9(1):99–108 20. Škafar B (2019) (In)effectiveness of quality management systems and models of excellence in practice. Management (Croatia) 24(1):71–84
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21. Tarasova SI, Drozhzhina NB, Dukhina TN, Limonova OO, Taranova EV (2018) Psychosemantic analysis of a leader’s image in the everyday consciousness of adolescent boys and girls. Ann Trop Med Public Health 9:S606 22. Zhang J, Li H, Xia B, Skitmore M, Pu S, Deng Q, Jin W (2019) Development of a marketoriented EFQM excellence model for analyzing the implementation of quality management in developing countries. DOI: https://doi.org/10.1080/15623599.2019.1590975
Influence of Financial and Economic Factors on the Sustainable Development of Russian Agriculture Igor Yu. Sklyarov , Yulia M. Sklyarova , Sergey M. Gorlov , Olga V. Mandritsa , and Galina A. Narozhnaya
Abstract The paper highlights the relevance of sustainable agricultural development in modern economic conditions. The main problems hindering the development of Russian agriculture in Russia are valuable credit resources, the lack of financial resources for agricultural producers in order to increase working capital for agricultural production and agribusiness development, as well as the increased impact of financial and economic factors on the sustainable development of agriculture in the Russian Federation. The paper presents measures for solving the accumulated problems of Russian agriculture, which will ensure sustainable development based on a new mechanism of the financial and credit system. The relevance of sustainable agricultural development does not decrease under the influence of changes within the world political system or with scientific and technological progress. Since the introduction of international sanctions against the Russian Federation, this problem has become a vital component of national security, and its role has significantly increased. Ensuring stable functioning in the agricultural sector of the economy is also an essential modern task that requires a productive and competitive domestic agribusiness. Keywords Agriculture · Agricultural products · Export · Import efficiency · Sustainable development · Agribusiness · Agricultural · Organization · Credit · Rates · Devaluation · International sanctions
I. Yu. Sklyarov (B) · Y. M. Sklyarova Stavropol State Agrarian University, Stavropol, Russia S. M. Gorlov North-Caucasian Federal University, Stavropol, Russia O. V. Mandritsa · G. A. Narozhnaya Stavropol Branch of the MIREA – Russian Technological University, Stavropol, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_37
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1 Introduction The relevance of sustainable agricultural development does not decrease under the influence of changes within the world political system or with scientific and technological progress. Since the introduction of international sanctions against the Russian Federation, this problem has become a vital component of national security, and its role has significantly increased. Ensuring stable functioning of the agricultural sector of the economy is also one of the essential modern tasks which require a productive and competitive domestic agribusiness. The changes in the Russian financial and credit system facilitated by the influence of the international sanctions led to the devaluation of the ruble. To avoid devaluation, many countries implement the following measures: stimulating exports of goods, restricting imports, increasing the key rate of the Central Bank, and obtaining loans from the International Monetary Fund within limits set for a certain quota of the country. Countries also use their available gold and foreign exchange reserves to prevent devaluation. The country experiences devaluation due to a chronically passive balance of payments, an increase in inflation, and a decrease in GNP growth and minimal efficiency. A similar event took place in Russia in 2014, which, in combination with the financial crisis and the imposed sanctions, radically changed the activities of many companies, including agricultural ones in the Russian Federation. It is worth noting that the Russian agricultural sector operates in a somewhat ambiguous and complex socio-economic environment since external factors in the form of sanctions and anti-sanctions significantly affect the functioning of the national economy [7, 11].
2 Materials and Methods The development of agricultural performance is statistically unpredictable due to unstable profit indicators. Therefore, it is also worth assessing the situation in the country and the world when talking about future profit indicators. These include the changes in the legislation on export goods, planned benefits for the agricultural sector, and subsidies. Among other things, it is difficult to assess the purchasing power of citizens, which depends on inflation, as well as income levels and pricing policies of enterprises. It is also impossible to predict the cost of per unit production regarding the instability of prices for raw materials, equipment, and other resources. Agribusiness will be able to benefit from the fall of the national currency if the production costs remain in the ruble zone, but sales get tied to the export markets [11].
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The lack of financial resources required for the increase in working capital and the implementation of investment projects presents one of the problems hindering agriculture development. We note that the existing system of agricultural loans has the following problems and limitations: – the loan application is reviewed for 1–3 months; – agricultural producers are often denied loans from credit organizations; – credit organizations have a low interest in providing loans to agricultural producers due to the low yield on issued loans and the high risk of non-repayment of issued funds [6], – commercial banks loan to agricultural producers that are in their customer base and are considered to be profitable, but they do not have interest in issuing loans to small or medium-scale agricultural producers [13, 14], – agricultural producers experiencing financial problems are denied a subsidized loan, but they can receive funds on credit at a relatively high interest rate of 18% per annum; – the granted subsidized loans for agricultural producers demonstrated a subsidized rate of more than 6%; – agricultural producers who have previously received loans would not be able to receive a new one; – since agricultural producers cannot provide high returns to commercial banks, commercial banks do not always take into account the interests of agricultural producers [13, 14], – there is practically no re-crediting to a lower interest rate on loans for agricultural producers; – subsidies on the issued credit for agricultural producers can be obtained only within the next period; – in December 2014 and January 2015, commercial banks unilaterally increased interest rates for agricultural producers on already issued loans. After analyzing the existing problems in the agricultural sector of the economy, it can be noted that agricultural producers have insufficient competitiveness in the domestic and foreign markets. This hinders the introduction of innovative technologies and the renovation of the material and technical base of agricultural producers.
3 Results The Government of the Russian Federation has responded to international sanctions by creating special economic measures against individual countries following their involvement in the sanctions regime against Russia. The list of import-prohibited agricultural products, raw materials, and food in the Russian Federation until the end
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Fresh or refrigerated cattle meat
Sausage
Salt
Fresh, refrigerated, or frozen pork
Milk and dairy products
Frozen cattle meat
Poultry meat and offal
Other products
Fig. 1 Foreign food products banned from being imported from some countries to the Russian Federation Source Compiled by the authors
of 2017, produced in these foreign countries, include the products demonstrated in Fig. 1. The Russian embargo aims to provide additional support to domestic producers and expand trade cooperation by increasing supplies from the countries of the Customs Union, Asia, and Latin America [6]; (Eliseev 2014). These sanctions created a vacant niche for Russian production. For example, at the beginning of the embargo, the import substitution volume of banned EU import products is estimated at 7 billion dollars (Table 1), while the total volume was estimated at 14 billion dollars [14]. The presented data demonstrate the new opportunities for agricultural producers in Russia, including opportunities for large agribusiness of appropriate production potential [4]. According to the Ministry of Agriculture, Russian agricultural producers have substituted more than four billion dollars’ worth of imported products during the food embargo period. The anti-sanctions introduced by the Russian Federation contributed to a significant increase in the production of food and livestock products for Russian agricultural manufacturers (Fig. 2). According to Fig. 2, Russia has reached and even exceeded the standard indicators for many products, but it also demonstrates vulnerabilities. For example, the supply of meat (lagging behind the standard by 2.7%) and dairy products (showing an insufficient result of 12.6%) remains the weak point of the Russian supply. On the one hand, international sanctions have become an engine and incentive for the production of domestic goods, especially in the segment of the agricultural sector of the Russian economy. On the other hand, they have created negative factors in the credit and financial sector, leading to limited access to cheap financial resources for Russian agribusiness and agricultural producers.
Influence of Financial and Economic Factors ... Table 1 The most significant EU exports of sanctioned goods to Russia in 2014
333
Product
EU import in billions of dollars
Share of EU import to Russia, %
Pork
1.304
61.1
Cheeses and cottage cheese
1.274
59.9
Apples, pears, quince
0.705
59.9
Other food products
0.635
63.8
Flour products
0.370
69.2
Nectarines, cherries, and wild cherries
0.326
53.2
Tomatoes
0.291
26.5
Other fruits
0.224
37.3
Vegetables
0.205
42.2
Butter, other oils and fats
0.183
26.9
Citrus fruit
0.147
8.8
Frozen fish
0.129
12.3
Milk and condensed cream
0.098
12.9
Poultry meat and offal
0.094
11.3
Cabbage
0.084
67.5
Source [3, 8]
120 100
105
95
80
90
80
75 80
97.4 95 77.4
90
82.3 85
60 40 20 0
Grain
Vegetable oil
Beet sugar
Actual production
Potato
Milk and dairy Meat and meat products products
Food Security Doctrine
Fig. 2 The share of domestic products in total resources (2018), % Source [3, 8]
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15
2.24
2.78
France
Germany
3.6
USA
5.3
China
Russia
Fig. 3 Interest rates in 2019, % Source: (Ministry of Agriculture of the Russian Federation, n.d.; Federal State Statistics Service of the Russian Federation, n.d.; [13, 14]
The imposed sanctions had a substantial impact on loans given by commercial banks to agricultural producers. In general, the volume of loans issued to agricultural organizations in Russia has decreased due to an increase in interest rates on loans [13, 14]. As a result, the availability of credit for agricultural producers has decreased. Figure 3 shows a comparison of average weighted interest rates for lending to the agricultural sector by country. According to the Ministry of Agriculture estimates, Russian agriculture received 28% fewer investment loans, and 5% less short-term loans were received 5% less in the first half of 2015. Only in 2017–2019, the volume of credit resources in the agricultural industry began its annual growth by an average of 7%. The deterioration of the agricultural sector, the increase in interest rates on loans for necessary agricultural procedures, and targeted long-term projects led to overdue loans. The Government of the Russian Federation has taken measures aimed at preventing a credit crisis, thus increasing loan subsidies for agricultural producers to 15%. Rosselkhozbank received financial assistance from the Government of the Russian Federation, amounting to several billion rubles. These events resulted in a reduction in the credit and investment bases aimed at implementing the Russian Federation food security strategies until 2020. Following the program for the development of the Russian agricultural sector until 2020, 70–90 billion rubles are allocated annually to subsidize interest rates on issued loans. It should be noted that the share of subsidized loans in 2020 should decrease from 32 to 23% compared with 2016 (Scientific library of the FSBSI A. A. Nikonov All-Russian Institute of Agricultural Problems and Information Science, n.d.). Russia carries out a unique lending program for agricultural organizations in the country, under which the loan rate for agricultural organizations varies from 1.5% to 5% but has regional limits and restrictions on the intended use and amounts. However, this lending rate allows Russian agricultural producers to compete with other countries on the world stage. The lending to domestic enterprises in the segment of the agricultural business is approaching the indicators of developed countries.
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Furthermore, the sanctions harmed the financial and investment conditions for the development of the Russian agricultural industry. In 2014, foreign banks decided to freeze 271 million dollars of investments into agricultural development projects, which accounted for about 45% of the foreign direct investment in the Russian agricultural industry. However, in 2015, the inflow of foreign direct investment in the Russian agricultural industry decreased only by 12%. Thus, Russia gradually adapted to the immediate economic situation under the impact of international sanctions (embargo on food products, limited financial resources, etc.). Russia increased the production capacity of food products, developed and implemented programs to improve the agricultural business (preferential loans, subsidies, and others) and well-being of the population as a whole through the liberation of market niches for domestic producers [11, 12]. Currently, the factors hindering agricultural efficiency are: (1) the deficit and limited production resources (especially in high-tech foreign production), (2) the decline in production efficiency, (3) the difficult financial situation, and (4) sectoral structural imbalances. In these conditions, it is essential to find optimal ways to preserve and reproduce resources, ensuring the effective functioning of agricultural production and agriculture as a whole. Russian agriculture requires an effective model for smoothing out the imminent external factors of influence within the industry. It is vital to choose the essential benchmarks that will support the sustainable development of the Russian agricultural segment. The essential tasks ensuring stability are import substitution, increasing production efficiency, stimulating competitiveness, and export growth. These tasks form the foundation of the sustainable development of the Russian agricultural industry and ensure national food security [14] When addressing its positive aspects of the ruble devaluation, it is worth mentioning that it brought the Russian Federation to the world leaders in grain exports in 2017–2018. The crisis of 2014 greatly affected the competitiveness of Russian exporters since the price of agricultural products in the national currency did not change, while the purchase price in foreign currency decreased. These factors made Russian agricultural exports profitable. The International Grains Council has made a forecast for an increase in grain exports in the Russian Federation to 44 million tons. As a result, Russia became one of the five largest grain exporters.
4 Discussion Thus, agribusiness benefited from the ruble devaluation in 2014–2015, if one were to only consider profits. However, we note the depreciated value of the ruble significantly increased the costs of imported technologies and means of production. At the same time, there is no alternative replacement for high-tech agricultural machinery and technologies in some sectors of agriculture, or it is insufficient.
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If agricultural producers can link their revenue to export markets and keep the cost of agricultural products in the ruble zone, then agricultural producers can get the most significant positive effect from the devaluation [11]. Having conducted a study of the agro-economic sphere of activity during the devaluation, we can state that the overall performance of a company depended on its activities and branches of production. For example, exporters had a sufficient increase in profits up to a certain point, while processing activities were under threat due to the increase (by 5–10%) in the sale prices of meat products while imported raw materials rose in price in direct ratio to the rise of the dollar and euro. There are several ambiguous perspectives on the benefits or harm of this phenomenon. Devaluation has positive aspects that become invisible under the influence of specific negative factors. Conversely, negative aspects are far more pronounced than the positive effects. The analysis revealed similar trends in Russian agribusiness export operations in the period from 2014–2019, namely: an increase in the level of profit in 2014–2015, an increase in revenue (from 2014 to 2016); a sharp reduction in profit in the period from 2015 to 2019; an increase in receivables; an increase in production costs; a significant increase in non-current assets in the period from 2014 to 2015.
5 Conclusion Proposals for the development of agriculture in the Russian Federation: – it is necessary to implement an annual reduction in the interest rate on loans issued in commercial banks with state participation in order to achieve the level of interest on loans in the amount of 4–6% for agricultural producers; – to set target indicators for the number of loans granted to agricultural producers in commercial banks with state participation, which will allow agricultural producers to obtain the right to pre-empt loans; – to strengthen control over the distribution of subsidies, as well as their use; – to finalize the system of providing subsidies for agricultural producers in accordance with the peculiarities of agricultural production and natural and climatic zones; – to create large export companies (preferably two companies in order to maintain competition in the Russian domestic market) with the participation of state capital; – to gradually increase restrictions on the export of agricultural raw materials (for example, grain), but not to restrict the export of finished processed agricultural products (for example, flour, pasta, confectionery) and food; – to implement a gradual transition from subsidies to a grant incentive system. We note that agricultural production development was positively influenced by state support and the existing state protectionism, which allowed preservation of the domestic agro-industrial business and increased agricultural production volume. However, the subsequent stage of agricultural production development requires a
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more modern mechanism of the credit and finance system and effective measures for the development of agricultural production to stimulate investment in agriculture.
References 1. All-Russian Research Institute of Agricultural Economics of the Russian Academy of Sciences. (n.d.). Official website. https://www.vniiesh.ru/ 2. Bazdnikin AS (2013) Prices and pricing. Yurait, Vyshee Obrazovanie, Moscow 3. Federal State Statistics Service of the Russian Federation. (n.d.). Official website. www.gks.ru 4. Koryukina NV (2018) Features of innovative activity of the agricultural industry at the present stage. Aekonomika Econ Agricult 3:12–20 5. Mahanko GV (2017) The problems of the Russian agricultural industry in the conditions of economic sanctions and ways to solve them. Sci J KubSAU 132:798–817 6. Marenkov NL (2015) The economic theory of price and pricing in Russian market relations. URSS, Moscow, Russia 7. Maryganova EA (2014) Macroeconomics. Crash course: Textbook. KONKURS, Moscow, Russia 8. Ministry of Agriculture of the Russian Federation. (n.d.). Official website. Retrieved from www. mcx.ru. 9. Safulin AR (2013) Welfare economics. Theory and practice: Textbook. UlSTU, Ulyanovsk, Russia 10. Scientific library of the FSBSI A. A. Nikonov All-Russian Institute of Agricultural Problems and Information Science. (n.d.). Official website. https://www.viapi.ru 11. Starkova OYa (2018). Import substitution in the production of potatoes and vegetables. Aeconomics Econ Agricult 2:11–14 12. Statsenko IM (2017) The analysis of the agricultural production concentration in the Federal Districts of the Russian Federation. Aeconomics Econ Agricult 11:19–24 13. Trukhachev VI (2015) Features of lending to agricultural organizations and the development of the financial and credit mechanism. Agric Econ 6:22–28 14. Trukhachev VI (2018) The impact of the rouble devaluation on the sustainable development of the agricultural sector of the Russian economy under international sanctions. Agric Econ 5:65–70 15. Yeliseyev AS (2014) Modern economics: textbook. Dashkov i Co, Moscow, Russia
Innovative-Based Development of the Dairy and Food Subcomplex of the Agro-Industrial Complex Svetlana I. Turliy
Abstract The paper focuses on the priority directions of innovative development of the dairy and food subcomplex of the agro-industrial complex [AIC] based on the selection of interacting subsystems and considering the nature of production and sales. The paper describes the functioning of the dairy and food subcomplex [DFS] from the perspective of developing the directions for its innovative development. The authors revealed prerequisites for the spread of advanced technological developments in the DFS in the context of its subsystems in the formation of an effective agricultural economy. The paper analyzes problems of the central link of the DFS presented by dairy cattle breeding. The problems are associated with the insufficiency of raw milk production, the DFS information privacy, and the market imbalance of milk and dairy products. The authors propose to improve the mechanisms for distributing state support, conduct a competent personnel policy, increase the information transparency of the industry by clarifying the contribution of private farms to milk production, and strengthen the control over the marketability, quality of breeding materials, feed, raw milk, and livestock accounting. The paper proves that investments in scientific and technological reformatting of the subcomplex are marked with capital intensity, risk, and long-term payback. This fact complicates their implementation and requires a systematic approach to the preparation, which assumes a comprehensive accounting of factors. Keywords Dairy and food subcomplex · Innovative development · Dairy farming · Investment projects
1 Introduction The need for innovative reformatting of the dairy and food subcomplex [DFS] is driven by its essential social and economic role in the system of human life support.
S. I. Turliy (B) Kuban State Agrarian University named after I.T. Trubilin, Krasnodar, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_38
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Moreover, the DFS is weakly (e.g., relative to the grain subcomplex) prepared to implement the import substitution strategy. The stability of milk and dairy production and the competitiveness of output determine the quality of human capital and ensure the food security of the state. However, the number of cows and the volume of produced raw materials continue to decline. The tasks of (1) achieving price parity in intersectoral exchange, (2) increasing the investment attractiveness of dairy cattle breeding and the degree of its innovative development, and (3) achieving a level of self-sufficiency in milk and dairy products are still relevant. The solution of these and related problems is possible with the use of intensive factors and achievements of scientific and technical progress based on (1) creating a stable feed base, (2) improving breeding work, (3) improving the reproduction of dairy herds and their qualitative composition, and (4) ensuring coordinated interaction of all branches of the studied subcomplex. There is currently a need to update and rethink the research on the functioning, development, and management of the DFS in the context of implementing the import substitution strategy in the food sector under the changing mechanisms of state support for the industry, the aggravation of the crisis, rising geopolitical tensions, and the budget deficit. These statements confirm the timeliness and relevance of the research.
2 Materials and Methods The research aims to create conceptual approaches to the development of the DFS based on detailing its structure and identifying the most responsive zones of innovative development. The goal sets the following tasks: – to clarify the nature, structure, and features of the DFS functioning, taking into account the principles of distribution of food subcomplexes in the AIC; – to identify the prerequisites for the development of innovative activities in the context of the DFS subsystems in the conditions of improving the efficiency of agricultural management; – to classify the problems of the leading DFS subsystem (dairy cattle breeding) and suggest possible ways to solve them; – to justify the need for a systematic approach to investment design in developing innovative activities in the DFS sectors and spheres. The research methodology is based on the logic of the goal, objectives, subject, and a set of research tools allowing us to theoretically justify the economic content of the studied object, structure it, identify problematic subsystems, and argue the need for the development of the DFS on an innovative basis.
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The paper uses such general scientific methods as analysis, synthesis, induction, deduction, analogy, modeling, abstraction, and concretization. The authors also applied the system approach, structural analysis, dialectics, and comparison.
3 Results The DFS is an integrated system of technologically and economically related industries focused on producing, processing, and selling milk and dairy products to meet consumer demand, considering the scientifically based physiological norms of food consumption. The studied economic literature (Krylatykh and Oreshin 2006); [2, 10, 14], relies on the following principles to distinguish product subcomplexes: – The uniformity of production of final products using agricultural raw materials of a specific type; – The commonality of the met target demand; – Cross-industry integration; – Unity of economic interests of the subcomplex links. The subcomplex composition is determined by the possibility of including industries, subsectors, and enterprises whose operation is entirely or mainly focused on the general target achievement. Following the principle of unity and homogeneity of products and the nature of production and sales processes, the DFS includes the following subsystems: – – – – –
Dairy farming [DF]; Field, meadow, and pasture fodder production [FP]; Processing [PI], feed [FI], and microbiological [MI] industries; Mechanical engineering which provides the DFS with means of production [ME]; Corresponding infrastructure [CI].
The selected DFS subsystems and the formation of an effective agricultural economy (the development of which is impossible without the expansion of advanced technological developments) establish the following prerequisites for the intensification of innovative activities in the sectors and areas of the subcomplex: – The intensification as the primary means of increasing the efficiency of dairy farming (DF); – An increase in sales of young pedigree animals through selection and breeding (DF); – The creation of a guaranteed feed base through the development of acreage structures based on increased production of plant protein (FP); – The introduction and development of milk processing plants to produce functional dairy products (PI, MI);
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– The application of biotechnology in the production of dairy products using microorganisms and living cultures (PI, MI); – Technical and technological re-equipment of the DFS enterprises (DF, PI, ME); – The construction of innovative infrastructure and modernization of state support mechanisms for the implementation and spread of R&D (CI) [12]. The specificity of the DFS functioning is due to the special role of the subcomplex in the food security system of the state and the importance of the manufactured products for the population. This should be taken into account when developing directions for developing the DFS. The main features are: – Seasonal nature of production, the short storage period of raw milk, and the impossibility of its long-distance transportation; – The need for strict adherence to quality standards for milk and dairy products and related controls; – The lack of price balance between agricultural producers and processors; a disparity of price elasticity for fluctuation periods of milk and processed products; – Weak adaptation of the dairy market to self-regulation and the limited presence of large processors and producers. The leading and weakest link of the DFS is the dairy cattle industry, which requires support for innovative reformatting. The problems of dairy farming are related to the insufficient production of raw milk. In most Russian regions, the industry’s investment attractiveness is low or insufficient, which means that it does not receive enough investment for innovative development. There are no effective mechanisms for allocating state program funds to the support of the industry. As a result, about a third of investment projects are not implemented. Delays in obtaining investment support lead to additional working capital costs and reduce the efficiency of breeding. Low competence among all groups of workers in milk production and low quality of veterinary medicine lead to a decrease in livestock productivity. Another group of problems is caused by the informational closeness of the DFS and the imbalance in the market of milk and dairy products. The unpredictability of the operating conditions of production and processing enterprises is determined by a complex of factors, including high volatility in raw milk production, the volatility of purchase prices, low cooperation of producers, and instability of their profitability. Moreover, the absence of high-tech domestic equipment increases the costs of production. Despite the measures taken to implement the import substitution policy, such dairy products as cheese, butter, dried whey, and others still occupy a weak competitive position in terms of price and quality compared with foreign analogs. The lack of necessary data complicates the qualitative analysis of the situation in the industry. Particularly, it is impossible to accurately assess the contribution of
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farmsteads to the production of commercial milk. There is also no reliable information necessary to control the level of marketability, quality, regrading, and livestock accounting, which hinders breeding. The lack of proper control also negatively affects the quality of breeding material, feed, and raw milk. Keeping highly productive animals and implementing the created genetic potential requires large-scale development of innovative resource-saving technologies in the conditions of modern complexes and reconstructed dairy farms. The production of milk on an innovative basis covers the following aspects of the functional activities of large mechanized farms and complexes: – – – – – –
Feed production and animal feeding; A rational cow milking system; Breeding work; Herd reproduction; Mechanization and automation of labor-intensive processes; Maintenance and development of animal welfare conditions following veterinary and sanitary requirements; – Rational organization of labor and recreation of dairy cattle workers [12]. The current stage of the development of dairy cattle breeding is marked by significant structural changes caused by the replacement of dairy herds. The decline in the dairy herd compared with the rate of productivity growth leads to a decline in milk production. This trend is typical for the industry in the Krasnodar Krai and Russia [13]. A feeding system requires several innovative changes to increase animal productivity. High yields do not require a large amount of stored feed. On the other hand, with a high number of livestock, there is a problem with manure concentration in small areas. Thus, soils are overloaded with organic substances contaminating the surface, underground water, and air with pathogenic microflora and toxic decomposition products. According to the website of “Kubanagroprod” LLC, farm animals account for 18% of greenhouse gas emissions (“Kubanagroprod” LLC, n.d.). The existing technologies for the utilization of manure runoff are, to a large extent, energy-intensive. Anaerobic processing based on a bioreactor for biogas production can be singled out as an innovative way of utilizing manure [8], (“Kubanagroprod” LLC, n.d.). The spread and commercialization of technical and technological innovations in the DFS are designed to ensure the growth of the public product, increase internal savings (which are a resource and source of subsequent reinvestment), and, consequently, increase the innovation and investment activity of the enterprises in the subcomplex. The interaction of innovation and investment processes establishes a platform for the sustainable development of the DSF and the implementation of its competitive advantages [9]. Investment support for the development of the DFS is a key condition for realizing innovative potential [11]. This information allows us to confirm the apparent need to (1) attract longterm investments in innovative renewal of the material, technical, and technological
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base, (2) construct or reconstruct production facilities, (3) reengineer technological lines, and (4) increase the genetic potential of livestock. This process requires the development of mechanisms for allocating investment resources.
4 Discussion Investment projects in the innovative development of the DFS and, in particular, the DF subsystem, are marked with high capital intensity, risk-taking, long payback periods, low efficiency of milk production, and a slight increase in livestock. Simultaneously, the situation is aggravated by a lack of state support and low predictability of the market situation. The level of capital concentration and the production scale in dairy farming positively affect the effectiveness of the innovative design. Consequently, large farms and complexes experience the effect of innovation to the greatest extent, but one should remember about the direct relationship between profit and risk. For example, the Krasnodar Krai is currently implementing two investment projects to construct dairy farms in the Krylovsky and Kavkazsky districts for 250 and 400 heads of livestock. The investments needed are 68 and 88.81 million rubles with discounted payback periods of 6 and 4.5 years (Investment portal of the Krasnodar Krai 2020). The heavy dependence of the DFS on feed production can offset technical, technological, organizational, and economic innovations due to its low efficiency. Additionally, the effectiveness of innovation investment directly depends on the genetic potential of productive livestock and the level of its use, which means that the formation of breeding herds and the organization of breeding work requires significant financial investment. Given the complexity of innovation and the implementation of investment projects in dairy farming and the DFS, we conclude that it is necessary to use a systematic approach to organizing innovation activities in the sectors and areas of the DFS [3, 6].
5 Conclusion The paper revealed the economic essence of the DFS, which consists of its disposition to integration and subordination of the subcomplex components to the general goal presented by the satisfaction of the final consumer demand for quality products. The paper established the prerequisites for intensifying innovative activities in the context of the DFS subsystems (dairy cattle breeding, feed production, processing industry, engineering, and infrastructure) under the need to increase the competitive advantages of the domestic agricultural economy. The key subsystem of the DFS is the dairy farming industry. It is the weakest link of the DFS that requires investment for innovative renewal. In this regard, the main
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problems of DF are differentiated into production and market groups. The paper identified its growth points and proposed to focus on the following areas: The development of mechanisms for distributing support funds; The development of employee expertise in the production sector; The implementation of high-tech domestic equipment in production processes; The elevation of competitiveness of milk-intensive products in terms of price and quality; The formation of effective information support systems and the development of quality control for breeding materials, feed, raw materials, and finished products. The capital intensity, high risks, and slow return on investment in innovation of the DFS subsystems established the use of a system approach that, along with the listed properties of sectoral investment projects, considers the unpredictability of the milk and dairy products market and the lack of state support.
References 1. “Kubanagroprod” LLC. (n.d.) Milk: Milk yield, milk consumption rates, the interrelation of productivity, and ecology. Retrieved from https://www.belkoff.biz/page_23.php. 2. Dolbilova EA, Alexandrova LA (2015) State support of Russian agriculture: new forms and priorities. Agricult Sci J 3:71–76 3. Dugin PI, Dugina TI, Berdyshev VE, Borovitsky MV et al (2010) Problems of efficiency in the innovative development of dairy cattle breeding. Center of Modern Education, Moscow, Russia 4. Investment Portal of the Krasnodar Krai. (n.d.) Official website. https://investkuban.ru/ 5. Kaishev VG (2006) State and development of the Russian food complex. Food Ind 3:6–18 6. Kotareva AO (2014) The development of innovation-oriented dairy cattle breeding in the region. Voronezh, Russia: Voronezh State Agrarian University 7. Krylatyh EN, Oreshin VP (1982) Planning the development of intersectoral complexes. Moscow State University, Moscow, Russia 8. Kulumbegov MM (2017) Organization and implementation of innovative technologies for the production of dairy products in the meat and dairy commodity complex on the example of the dairy industry. Naukovedenie 9(1):1–17. https://naukovedenie.ru/PDF/60EVN117.pdf 9. Nechaev VI, Artemova EI (2009) Problems of the innovative development of animal husbandry. Agri, Krasnodar, Russia 10. Nuraliev SU (2005) Problems and prospects of development of the Russian food market within the WTO. Econ Agricult Process Enterp 8:12–15 11. Orekhova MS, Gurnovich TG (2018) Priority directions of development of innovative and investment activities in crop production. Mirakl, Moscow, Russia 12. Petrov EA, Petrova OG (2016) Prerequisites for innovation in the dairy and food subcomplex of the agro-industrial complex. Koncept, 1. https://e-koncept.ru/2016/16004.htm 13. Sirotkin VA, Shibanihin EA (2015) Aspects of functioning and dynamics of development of the dairy subcomplex of the Krasnodar Krai agro-industrial complex. Sci J KubSAU, 2. https:// ej.kubagro.ru/2015/02/pdf/078.pdf 14. Vorobev NN (2006) The formation of the food market structure. AIC: Economics. AIC Econ Manage 8:30–31
Comprehensive System Approach to the Analysis of the Financial Sustainability of the Organization Nadezhda V. Kondrashova , Larisa S. Korobeinikova , Kira N. Vasilieva , Maria V. Tkacheva , and Artem V. Krivosheev
Abstract Economic analysis as a tool for understanding the surrounding economic reality is similar to all economic sciences with a common study object – economic relations. All economic sciences, combined into a system, differ in the subject, and, accordingly, in the research methodology. The paper is devoted to determining the boundaries between complex and systemic economic analysis, their relationship, and interpenetration. The authors touch upon the issues of the implementation of such fundamental principles of analytical research as complexity and consistency in economic analysis as a science and type of practical activity. For example, the object of economic analysis is a certain level of financial stability of a commercial organization. The authors applied the theoretical and methodological provisions in science and practice in building analytical blocks of the economic analysis system, detailing a specific block of the general analysis scheme, adhering to the principles and requirements for building a system of analytical indicators, etc. The authors conclude the consistency of economic analysis, an essential feature of which is its complexity. Keyword Comprehensive · System · Approach · Economic analysis · Methodology · Method · Toolkit · Financial sustainability
N. V. Kondrashova · L. S. Korobeinikova · K. N. Vasilieva · M. V. Tkacheva · A. V. Krivosheev (B) Voronezh State University, Voronezh, Russia e-mail: [email protected] L. S. Korobeinikova e-mail: [email protected] K. N. Vasilieva e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_39
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1 Introduction The choice of an approach to solving the assigned tasks, understanding of this approach, and possession of the skills to apply it play a decisive role in achieving the research goal. In this aspect, the issue of choosing guiding principles scientific tools (methods, methods, techniques, a certain combination of them), types of research, and research directions are the essence of the methodological approach. The methodology of economic analysis as science uses scientific approaches common to many knowledge areas, including complex and systematic approaches. An integrated and systematic approach is a conceptual basis, a philosophical basis for such principles of economic analysis as complexity and consistency. Many scientific, educational, and methodological works are devoted to the essence, content, and practice of applying the system approach in economic analysis. The system approach and model of complex economic analysis with its scientific apparatus were introduced by A. D. Sheremet [10], in the 1970s. The conceptual foundations for building a system of complex economic analysis are formulated, intensely worked out, and developed in the works of such scholars as M. I. Bakanova, V. I. Barilenko, S. B. Barngolts, L. T. Gilyarovskaya, D. A. Endovitsky, V. V. Kovaleva, N. P. Lyubushina, M. V. Melnik, G. V. Savitskaya, A. D. Sheremet [5]. In Russia, the modern understanding of the theory, methodology, and methods of the systematic approach in complex economic analysis is set out in textbooks and is an academic discipline of each educational program of economic orientation.
2 Materials and Methods The authors use such phrases as “system approach,” “complex economic analysis,” “system of complex analysis.” Let us turn to the opinions of researchers and analytical scientists regarding the understanding of integrated and system approaches, their boundaries, and the complexity and consistency of analytical procedures. The existing set of authors’ views on the systematic approach in general and in economic analysis allowed us to highlight some of its features. V. M. Edronova and A. O. Ovcharov conducted an interesting methodological study, where they highlighted the principles of the system approach: • • • • •
Integrity; Hierarchy of structure; Structuring; Multiple descriptions; System elements.
These authors give a detailed review of the concept of “system.” The typification of systems in scientific research, economics, and enterprises is carried out. No matter what system is used during the research, “the main methodological requirement of
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the system approach is the integrity of the object of consideration. The integrity of the studied system is the starting point of any system research; it guides knowledge from beginning to end” [2]. A. I. Mokhov [8], pointing to integrity as a distinctive feature of the system, speaks of clear boundaries separating the system from the external environment. Then, the basic principles of the system approach are as follows: • Integrity, interconnection, dynamic nature, and clear boundaries of the system and external environment; • “Changes occur following the “internal” laws of the object” [8]. Regarding the integrated approach, the author concludes that “in each research area separately, the objects of research are traditionally considered as systems, and, in the case of the intersection of two or more areas, the research objects acquire the properties of a complex.” Accordingly, the principles of an integrated approach are: • “The interconnection of systems maintains integrity”; • “Interconnectedness and dynamic nature of the studied system and the external environment” [8]. Some scholars [1, 9, 11] characterize the system approach through dynamism, integrity, subordination, and system interconnection elements, and complexity. The developer of complex economic analysis, A. D. Sheremet, saw the scheme of complex analysis as follows: • • • • • •
Generalizing indicators of economic activity (first level); Detailing each block of the general scheme (second level); Classifying factors to indicators (third level); Establishing links between factors and indicators; Integral method of factor analysis; Implementing a method of a comprehensive assessment of the effectiveness of activities based on its intensification • Implementing a method of rating a comparative assessment of effectiveness [10, 11]. It should be noted that the construction of a block diagram of complex analysis, the formation of a system of analytical indicators [6], and obtaining generalized assessments involve the use of a system approach. The work by E. N. Kuzbozhev, M. G. Svetovtseva, and T. N. Babich (2006) is of particular interest among the methodological studies in economic analysis. The authors summarize a significant array of sources and delimit the systematic and integrated approach by such features as a concept at the base, principles, primary goal, object, methodological basis, thing, conceptual framework, principal value, procedures, stages, technique, and main distinguishing feature. One can argue about the selection and the content of some features. However, we can agree with the majority of distinguished features. The authors of the paper support the opinion about the comprehensiveness and versatility of complex analysis. “The basic concepts
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of complex analysis include … the comprehensiveness of analysis, consistency of analysis, the presence of a single purpose, consistency, and simultaneity” [7]. Thus, a systematic approach in its general sense is understood as a methodological direction based on a specific understanding of the object of economic analysis as an integral system. In its general sense, an integrated approach should be understood as a methodological direction, which is based on the identification of essential aspects for a particular object and an orientation towards versatility and totality. For economic analysis, multilateralism is manifested in the totality of directions and types of analysis, indicators, factors, methods, algorithms, sources of information, responsibilities between performers, and the search for reserves united by a common goal and objectives. Thus, a comprehensive analysis is based on systemic conditions since, in the economic analysis of an object, it is necessary to adhere to a specific logically grounded sequence of actions and take into account the cause-and-effect relationships between processes. System analysis is carried out based on complexity, i.e., achieving the goal of economic analysis using a set of principles, methods, procedures, and complete and high-quality information.
3 Results Let us reflect on the above on the example of analyzing the financial stability of an organization as an object of comprehensive economic analysis. The implementation of the consistency principle represents the analysis of financial stability, i.e., a system that combines logically interconnected elements of a lower order, and, at the same time, is an integral part of a system of a higher level, in which the analysis of financial stability itself is an element interconnected with other subsystems [3, 4]. Figure 1 gives an example of a block diagram of a complex economic analysis system. In the economic analysis system scheme, the analysis of the financial condition is separated into a separate block (block 10). The degree of “quality” of the financial condition is determined by the factors determining the business functioning: • The ability of the organization to regulate costs, generate income, and receive financial results in the form of profit values; • The efficiency and intensity of the use of assets and their elements; • Capital structure, demand for products, the ratio of profitability, and weighted average price for capital, financial policy. Thereby, the organization’s solvency, financial stability, independence from external sources, and the ability to finance current activities with its own sources are determined. It is advisable to understand the constituent elements of the analysis of financial conditions to present the analysis of financial stability as an element of an independent
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BLOCK 1 Preliminary overview of summary indicators BLOCK 2 The analysis of the organizational and technical level and socio-economic and environmental conditions of production BLOCK 3 The analysis of the use of fixed assets
BLOCK 6 The analysis of the output, structure, and quality of products, works, and services
BLOCK 7 The analysis of production costs
BLOCK 4 The analysis of the use of material resources BLOCK 5 The analysis of the use of labor resources
BLOCK 8 The analysis of product sales and asset turnover
BLOCK 9 The analysis of profit and profitability
BLOCK 10 Financial analysis
BLOCK 11 Generalized assessment of the financial viability and efficiency of production and financial activities
Fig. 1 General scheme and interrelation of individual blocks in the system of complex economic analysis Source [3]
system. Figure 2 illustrates the composition of the analysis of financial condition by its elements. The theory and practice of economic analysis developed a mechanism for analyzing the research object with the inclusion of a set of organizational support of work, information sources, choice of methods, techniques, and means of processing the available information about the analyzed object. This mechanism is a method of economic analysis. The typical content of the methodology includes the following sections: • Program-targeted; • Information and legal;
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FINANCIAL STATE ANALYSIS SUBSYSTEM
The analysis of the property
The analysis of liquidity and solvency
The analysis of funding sources
The analysis of financial stability
The analysis of cash flow
The analysis of bankruptcy probability
Fig. 2 The composition of the analysis of the organization’s financial condition Source [3]
CALCULATION AND ANALYTICAL SECTION OF THE ANALYSIS OF FINANCIAL STABILITY
The analysis of the rationality of placing funding sources in property The analysis of the dynamics of the composition and structure of debt capital
The analysis of the dynamics of the value of their working capital and net working capital The analysis of the sufficiency of financial sources for the formation of reserves
Factor analysis of financial stability
The analysis of the sufficiency of financial sources to finance current activities
The analysis of the dynamics of the composition and structure of equity capital The analysis of the financial leverage mechanism
The analysis of the dynamics of net assets
COMPREHENSIVE ASSESSMENT OF THE FINANCIAL STABILITY
Fig. 3 Contents of the calculation section of the methodology for analyzing the organization’s financial stability Source [3]
• • • •
Organizational and managerial; Calculation and analytical; Evaluation and interpretation; Control and correction [4].
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The content of the calculation and analytical section of the methodology for analyzing an organization’s financial stability is reflected in Fig. 3. Analytical methods, techniques, and means involved in achieving the set goals of analysis in various combinations are used to solve the problems of each aspect of the calculation and analytical section of the methodology. Thus, the consideration and practical application of the analysis of an organization’s financial stability as a system, the study of its integrity, and the identification of various types of connections within this phenomenon form the basis of the system approach. The complexity of the analysis of financial stability is expressed in obtaining a comprehensive assessment of its level, the impact on the overall financial viability, and the choice of areas for searching for reserves. Any specialist related to the organization and its management must understand the need to comply with the conditions for the complexity and consistency of economic analysis and be familiar with the entire scientific tools set.
4 Conclusion The authors are convinced of the existence of an inextricable relationship between an integrated and systematic approach to economic analysis. It is relevant to talk about the system of complex economic analysis. Under the influence of dynamically changing conditions of the external environment, priority tasks of economic development, methods of constructing a system of indicators, and comprehensive assessment are also improved. The content of the analysis of indicators of new blocks of economic activity conditions (social, environmental, sustainability, etc.) is developed. The methodological unity of the consistency and complexity of economic analysis finds its expression in: • • • • •
setting a single goal and objectives of the analysis; the use of all types of economic information; the development of a system of indicators and modeling of factor systems; the organizational support of the analysis; the effectiveness of the object’s functioning, conducting a generalized assessment.
References 1. Barngolts SB, Melnik MV (2003) The methodology of economic analysis of the activity of an economic entity. Finance and Statistics, Moscow, Russia 2. Edronova VN, Ovcharov AO (2013) Methodological approaches in scientific research. Economic Analysis: Theory and Practice 11(314):20–31 3. Endovitsky DA (2001) Comprehensive analysis and control of investment activities. Finance and Statistics, Moscow, Russia
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4. Endovitsky DA (2009) A system approach to the economic analysis of the assets of an economic entity. Economic Analysis: Theory and Practice 15(44):2–11 5. Endovitsky DA, Lyubushin NP, Babicheva NE (2015) Dialectics of theoretical and methodological foundations of economic analysis. Economic Analysis: Theory and Practice 20(419):2–15 6. Kondrashova NV, Endovitskaya EV (2016) The scientific basis for constructing a system of analytical indicators. Socio-Economic Phenomena and Processes 11(9):34–39 7. Kuzbozhev EN, Svetovtseva MG, Babich TN (2006) System or Complex Analysis? Economic Analysis: Theory and Practice 9(66):9–16 8. Mokhov AI (2019) The difference between systematic and integrated approaches in scientific research. Greater Eurasia: Development, Security, Cooperation 2–1:520–527 9. Savitskaya GV (2008) The theory of the analysis of economic activity. Belarus State Economic University, Minsk, Belarus 10. Sheremet AD (2014) Comprehensive analysis of indicators of sustainable development of the enterprise. Economic Analysis: Theory and Practice 45(396):2–10 11. Sheremet AD, Negashev EV (2000) The methodology of financial analysis. INFRA-M, Moscow, Russia
Digital Technologies for Innovative and Sustainable Development of the Agro-Industrial Complex as a Complex Socio-Economic System Olga Yu. Antsiferova , Ekaterina V. Ivanova , Ekaterina A. Myagkova , Alexander V. Strelnikov , and Larisa M. Petrova Abstract The paper focuses on the issues and problems of the innovative development of the Russian agro-industrial complex [AIC] to ensure its sustainability. The authors determine the role and importance of the digital economy in the implementation of innovations. A special role is given to the analysis of the digitalization in the agrarian sector on the example of the Tambov region. The level of innovative development of agricultural organizations in the region is analyzed in detail. The positive and negative factors affecting the possibility of introducing the digital economy into the activities of agricultural organizations are highlighted. The paper focuses on the substantiation of promising areas that allow increasing the innovativeness of agricultural production. Keywords Agro-industrial complex · Digital economy · Digitalization innovation · Sustainable development · Tambov region
1 Introduction The objective of the sustainable development strategy of the Russian Federation is to ensure stable indicators of economic growth, the competitiveness of agricultural production, and the solution of socio-economic, production, technological, natural, and ecological problems based on the optimal use of innovative, scientific, and technological potentials, updating equipment and technologies, and the extension of markets. In current economic conditions, the implementation of the achievements of scientific and technological progress, in some cases, does not sufficiently correspond to the innovation process and the development of innovative activities. In most cases,
O. Yu. Antsiferova (B) · E. V. Ivanova · E. A. Myagkova · A. V. Strelnikov · L. M. Petrova Michurinsk State Agrarian University, Michurinsk, Russia E. V. Ivanova e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_40
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the effectiveness of the innovation process is determined by the willingness of business entities to introduce and use knowledge-intensive technologies, one of which is manifested as digitalization. The basis for the stable functioning of industries and subsectors is the use of innovative technologies that provide structural changes in each area of the AIC, ensuring production growth and coverage of material needs. The answer to the challenges of instability lies in innovative activities, strengthening, optimizing its implementation, and commercialization. Additionally, the development of digitalization will become the primary vector for increasing production efficiency.
2 Materials and Methods The sustainable development of Russia became the primary vector of the functioning of state and economic structures. In these conditions, digitalization is one of the main goals of sustainable development. Thus, in the official communiqué “Sustainable Development Goals in the Russian Federation” (Federal State Statistics Service [3], it is emphasized that, along with the growth of the gross domestic product in Russia and the growth of investments, it is necessary to ensure the presence of broadband Internet and access to the Internet resources, that is, the ability to access digital resources of the economy (Table 1). The optimal development of technical and economic processes, the achievement of the necessary values of the investment, and innovation-oriented development of each constituent entity of the Federation depends on the availability of constant competitive advantages for each commodity producer and the motivation of innovative activities from the standpoint of the macroenvironment. Technical and economic Table 1 Indicators of sustainable development of the Russian Federation (selectively) Indicator
Units
2011
2012
2013
2014
2015
2016
2017
Gross domestic product of Russia in a single currency per capita (at purchasing power parity)
$
24.310
25.785
26.240
25.797
24.146
24.110
25.749
The share of households with broadband access to the Internet
%
56.5
64.1
66.8
70.7
72.6
The share of the enterprise using broadband Internet access
%
79.4
81.2
79.5
81.8
83.2
63.4
76.6
Source (Federal State Statistics Service [3]
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processes are developed by optimizing the interaction of the components of the innovation sphere of the Russian constituent entities. Respectively, a significant degree of responsiveness to the nature and size of innovative transformations is observed. The innovative development of the region is conditioned by the acquisition of sustainable competitive advantages by business entities and the stimulation of innovative activities from the external environment by strengthening the interaction of all elements of the regional innovation sphere and, as a result, by a high degree of responsiveness to the nature and scale of innovative changes. In this regard, besides activating innovative and technological factors, one of the critical areas of innovative development to form sustainability can be the development of the digital economy, which allows creating favorable conditions for the conduct of economic activities by commodity producers (Fig. 1) [1]. A well-structured digitalization policy, increased labor productivity, and popularization of new professions are the main directions for implementing the digitalization policy in relation to regional conditions. The data indicate that the Tambov region is doing quite well with the development of the digital economy. Thus, according to the Federal State Statistics Service, the region is among the leaders of the Central Federal District and the whole of Russia [1] (Table 2). Until recently, the use of digital technologies in agricultural production was limited only to computers and related software only in such processes as financial management and commercial transactions. In agriculture, the share of such technologies and involved specialists is still relatively low [1] (Fig. 2). Thus, agriculture employs only 0.4% of ICT specialists from the total number, while in the information and communication, this figure equals 32.6%.
Fig. 1 The share of enterprises that identified the importance of factors hindering the introduction of technological innovations, 2017 Source [1]
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Table 2 Business digitalization index by constituent entities of the Russian Federation, 2017 Region
Index value
incl. index indicator: the share of organizations using broadband Internet, %
Central Federal District, total
29
87.4
Belgorod region
29
87.5
Tambov region
30
94.6
Tver region
23
78.3
Moscow
35
94.9
Source [1]
Agriculture, hunting, fishing and fish farming
0,4
Finance and insurance
7.3
Professional, scientific and technical activities
7.4
Wholesale and retail trade
5.4
Information and communication -3
2
7
12
17
22
27
32
Fig. 2 ICT specialists by economic activity: 2018 (of the total number of ICT specialists) Source [1]
However, the current conditions for the functioning of agricultural organizations require a digital transformation in the field of interaction between enterprises and government bodies and in crop production, animal husbandry, processing of agricultural products, collection, storage, and logistics. The development of agricultural organizations necessitates the application of digitalization. It is necessary to ensure stable economic growth indicators, the competitiveness of agricultural production, and the solution of socio-economic, productiontechnological, and natural ecological problems based on the optimal use of scientific and technical potential, updating equipment and technology, and expansion of sales markets. Simultaneously, some economic indicators do not give a real picture of the potential for the innovative development of economic entities from the side of a real representation of existing features. Such indicators do not show the real potential of innovative development of business entities and innovative processes in the branches of the real sector of the economy, including agriculture. Let us note that the effectiveness of the introduction of such a science-intensive product as digital technology is determined by the degree of readiness of the AIC entities to introduce innovation.
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The determining factor is the synergistic opportunity, determined not so much by the possibility of implementing the collected data from the external environment, but by the interaction of the agricultural producer with the macroenvironment. The diffusion of innovations in agriculture is slow and is determined by the type of AIC organization and the level of their participation in the innovation process (Shrelnikov [6]. The key indicators of innovative development, and, as a consequence, the introduction of digital technologies, are an increase in the quantity and quality of financial investments, cash flows from activities, the volume of financial investments, cash flows from investment operations, and an increase in the size of budget allocations and the size of investments. In our opinion, the degree of innovative development of entrepreneurs, commodity producers, and other business entities is directly determined by digitalization. It depends on several conditions: economic, industrial, social, environmental, and institutional (organizational), changing under the influence of the macro- and microenvironment of functioning. The primary role for agriculture is played by the development by commodity producers of their funds, which determines the growth of revenue, affects the change in the amount of profit, the efficiency of using production, resource potential, and financial investments, including funds for financing investments and various subsidies received from the budgets of all levels (Table 3). Quantitative and qualitative innovative changes in the agro-industrial sector of agriculture in the Tambov region indicate a positive innovation climate in the region and the provision of internal reserves, which will allow to sufficiently implement digital technologies in agricultural production. The most promising direction, allowing to increase the innovativeness of agricultural production, is information systems based on geoinformation technologies, which allow solving a wide range of issues [2]: – – – – –
tracking the state of crops and agricultural operations; forecasting crop yields and assessing losses; monitoring, analysis, and planning of the equipment used; planning of agricultural operations; information support for decision making.
The formation of a set of information, which is necessary to create a digital model of the territory where agricultural work is carried out, contributes to collecting information on the properties and features of soils, remote sensing, technological maps in the dynamics, and genesis of agricultural work. The availability of information management systems based on geoinformation technologies plays a significant role in planning technological operations in agriculture, which: – influence and determines the proportion of sown areas and crop rotations; – makes it possible to determine the structure of crops and crop rotations in a digital format;
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Table 3 Leading indicators of innovative development of agricultural organizations in the Tambov region Indicators
Years 2013
The number of 318 agricultural enterprises, units
2014
2015
2016
2017
2018
308
286
275
268
249
The ratio of 2018 to 2013, % 78.3
The number of personnel employed in agriculture, thousand people
22.4
22.3
21.6
21.5
24.0
26.6
118.8
The amount of social payments, million rubles
12.8
40.6
17.9
44.0
35.8
74.3
5.8 times
The average annual cost of fixed assets, billion rubles
36.7
47.2
60.1
77.0
95.3
105.3
2.9 times
Material and monetary costs, billion rubles
25.5
34.0
38.5
54.6
70.1
78.8
3 times
Gross income, billion rubles
12.7
13.6
25.3
40.5
41.2
42.0
3.3 times
Long-term and short-term financial investments, million rubles
5,064.9
6,051.9
6,652.9
7,424.9
5,967.9
7.0
10.2
18.8
58.5
39.9
Cash flows from investment operations, billion rubles
Budget subsidies 2,329 of all levels, million rubles Funds for financing investments, billion rubles
17.0
3,728
11.5
Source Calculated by the authors
4,431
17.2
8,721
31.3
5,267
116.5
4,751
146.4
3,833
128.6
117.8
5.7 times
1.6 times
7.6 times
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– allow to develop a list of operations on soil impact, plant protection, and fertilization; – qualify farmland; – analyze the potential and efficiency of the use of material, technical, and labor resources; – calculate the requirement for fixed assets.
3 Conclusion The effective functioning of the cartography system of an agricultural enterprise is possible only if the information is combined into a single database [4]. With the help of GIS technology, it is possible to plan, monitor, and analyze technical subsystems of agricultural producers. Thus, digitalization and Big Data in the agricultural sector contribute to the most effective analysis of the production means and consumables used, including monitoring the distance of movement and the amount of farmland cultivated. Digital technologies allow us to make schedules for the activities and maintenance of agricultural machinery when performing agricultural operations, monitor the speed of the units movement, find the best way to move the transport unit, move the equipment from the place of deployment to the place of work, and issue documentation for the delivery of goods and crops. Additionally, with the help of digital technologies and appropriate software, it is easy to conduct accounting activities for the rationing and wages based on the compilation of digital maps of fields. GIS technologies and their implementation will help ensure the sustainability of agriculture in the short term. The practice shows that the payback period for investments to introduce GIS technologies ranges from 1 to 3–5 years. Simultaneously, the first result from the implementation of this system depends on the scale of application and is visible at the end of the first year of use, since competitiveness increases along with the profitability of the company by reducing costs and more efficient use of available resources. Additionally, digitalization in agriculture helps solve the problem of quality, accuracy, and availability of data among managers, which is necessary for making the most accurate and effective decisions, which will help the agricultural industry cope with the challenges of increasing productivity and ensure sustainable development.
4 Results The research allowed us to determine the most important conditions and factors affecting the possibility of the digitalization of agricultural organizations to achieve its sustainability (Table 4).
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Table 4 Factorial impact on the possibility of digitalization of agricultural organizations Negative influence
Positive influence
Territorial dispersal of production and Improvement of the management system structural divisions of agricultural organizations through the development and implementation of strategic plans of agricultural organizations and multivariate development of agricultural production The multiplicity of participants and the fragmentation of agricultural organizations, entailing an increase in the level of competition in the markets of agricultural raw materials and food
The accumulation of production and resource potential and more efficient use of the material and technical base of agricultural organizations
Limited diversification of agricultural products
The assessment of conditions and factors for improving the effectiveness of management and production processes
The lack of elaboration of state regulation mechanisms regarding various organizational and legal forms of management
The possibility of forecasting the volume of production and sales based on the market research of raw agricultural materials and food
Remoteness from large territorial centers, low level of technical equipment, underdeveloped computer network
Broadband and high-speed Internet access
The predominance of economic, collective, and The development of corporate culture in personal interests over public interests in the agricultural organizations process of economic activity Source Developed by the authors
The territorial dispersion of agricultural production and individual structural divisions of agricultural organizations is referred to as negative. Moreover, the insufficient elaboration of the mechanisms of state regulation of the economic activities of organizations, which does not allow to sufficiently expand the range of agricultural products and timely response to changes in the market situation for products, is also a limiting factor in the development of agricultural organizations during their digitalization. Simultaneously, the conditions and factors that positively affect the process of strategic management of agricultural organizations include the possibility of developing multivariate development scenarios with further forecasting of key indicators of the agricultural activities of organizations. Additionally, the possibility of accumulating production and resource potential at each stage of strategic management will make it possible to more effectively use the existing material and technical base and, in general, to identify conditions and factors that make it possible to increase the effectiveness of digitalization in agricultural production. Thus, the transition of agricultural industries to an innovative type of development for the effective functioning of the digital economy presupposes the development of scientifically grounded strategic parameters for the qualitative renewal of agricultural production. The renewal is formalized in the form of a single strategy
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of innovation-oriented development. It includes bringing together a set of necessary tools in a systematic form, contributing to the solution of the goals and objectives in the framework of the state innovation policy. The guidelines for the digitization of scientific, technical, and innovation activities for the long term and the mechanism for managing innovation-oriented development of agricultural production should be aimed at strengthening the innovative susceptibility of agricultural producers and, as a result, the ever-widening development of digitalization.
References 1. Abdrakhmanov GI, Vishnievsky KO, Gokhberg LM, Demyanova AV, Kevesh MA, Kovaleva GG, Fursov KS (2019) Indicators of Digital Economy 2019: Statistical Collection. The Higher School of Economics Publishing House, Moscow 2. Antsiferova OY, Sutormina ES (2019) Modern state and prospects of development of innovative infrastructure of the agro-industrial complex. J. Michurinsky State Agrarian Univ. 3:118–123 3. Federal State Statistics Service, Sustainable development goals in the Russian Federation, Russia, Moscow (2019) 4. Ivanova EV (2017) Institutional and Reproductive Aspects of Import Substitution in the Agricultural Complex of Russia. MSAU Publishing, Michurinsk 5. Myagkova EA (2006) The Formation of the Planning System at Agricultural Enterprises (Dissertation of Candidate of Economic Sciences). Michurinsk Science city, Michurinsk 6. Shremnikov AV (2017) Management of Innovative-oriented development of agricultural production. Russia J Rural Dev Soc Policy 3(15):88–90
Monitoring the Readiness of Agriculture for Modernization in the Digital Economy Inna B. Manzhosova, Sergey A. Tunin , Natalia V. Kulish , Olga E. Sytnik , and Victoria S. Germanova
Abstract The complex of inversions in agricultural production can be leveled out mainly by transitioning to a digital type of agricultural modernization. The research object is the agrarian sector of the Stavropol Krai. The study of the functional reality of agriculture, including the modernization in the digital economy and the formation of opinions on the degree of readiness of all stakeholders for the transition to digital technology in agriculture, was carried out through a questionnaire and indepth interviews on various aspects of this issue of three focus groups of highly qualified respondents (heads of agricultural organizations of the Stavropol Krai, workers and specialists of agricultural organizations from 23 municipal districts of the Stavropol Krai, and independent experts studying the problems of the agricultural sector of the economy). The purpose of the questionnaire was to study external and internal sectoral opportunities, prerequisites, priority areas, and constraints for digital modernization in agriculture. A special algorithm was developed for multi-parameter monitoring of the readiness for modernization in the context of digitalization. Keywords Agricultural sector · Modernization · Digitalization · Digital economy · Digital agroeconomics · Circular economy · Digital modernization
1 Introduction In current conditions, agriculture is on the verge of overcoming global challenges associated with transformation processes in the economy and society. A great influence on the stability of the functioning of the agricultural sector is exerted by such global trends as the need to provide food for the growing population, the transition to organic food for growing urbanized territories, the increasing differentiation of the population in terms of living standards and access to healthy food, the need to increase life expectancy while maintaining its quality, global warming, increasing aridity and desertification of agricultural land, and increasing anthropogenic load I. B. Manzhosova (B) · S. A. Tunin · N. V. Kulish · O. E. Sytnik · V. S. Germanova Stavropol State Agrarian University, Stavropol, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_41
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on the ecosystem. In the current conditions, the modernization of agriculture is an uncontested option for achieving stable economic growth (Bogoviz et al. [5]. This is especially important due to the need to increase the competitiveness of the Russian agricultural business in increasing globalization, the spread of digital and robotic technologies and intelligent production systems, and the growing role of the agricultural sector for the domestic economy. The digital economy is increasingly reflected in the scientific works of domestic accounting [4]; Andreeva et al. [2, 10, 23, 24]. The modern arsenal of scientific research was replenished with works in the digitalization of agriculture (Arinicheva, Bessarabova and Lichot [3, 6, 7, 11].
2 Materials and Methods The study of the possibilities, prerequisites, and restrictions for the modernization of agriculture under the transition to the digital economy, carried out through a questionnaire survey, made it possible to draw several conclusions regarding the degree of readiness of the sectoral management system and agricultural organizations to carry out significant transformations in agriculture. For this, the methodology of conducting sociological surveys according to the Delphi method [9, 13, 16] was applied; a special algorithm was developed. The study was comprehensive and involved the study of the opinions of various stakeholders on the readiness of the sectoral management system at the regional and municipal levels, management and employees of agricultural organizations, and the population and society to carry out significant modernization reforms in agriculture. To obtain relevant information when forming the questionnaire survey methodology, we set and consistently solved the following tasks: 1. 2. 3. 4.
5. 6.
7.
To study the functional reality of the existing development model of the agricultural sector under technical and technological modernization; To form an opinion on the degree of readiness of all stakeholders for the transition to digital technologies in agriculture; To identify the priority areas of modernization from various subjects of the agricultural economy; To evaluate the experience of workers and heads of agricultural organizations in conducting technological modernization and introducing elements of the digital economy; To identify the factors, causes, and actions that stimulate or limit the digitalization of agriculture; To reveal the advantages and disadvantages of the introduction and subsequent use of digital technologies in agriculture from the perspective of various stakeholders; To identify the most priority technologies and areas of digitalization in agriculture;
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8.
9. 10.
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To identify the most effective measures of state support for the modernization of agriculture in the digital economy, including organizational, financial, and infrastructural measures; To identify the key areas of financial and personnel support for agricultural modernization in the digital economy; To form a holistic picture of “bottlenecks” and promising areas of agricultural modernization in the digital economy, etc.
To solve the set of tasks, we formed three focus groups of respondents directly related to the agricultural sector: 1)
2)
3)
The focus group “Managers.” This focus group was made up of heads of agricultural organizations of the Stavropol Krai with the average work experience of 17 years. The respondents of this focus group represented 12 different municipal districts of the Stavropol Krai from four agro-climatic zones of the region. These are mostly organizations with 100–500 employees. As for the age structure of these groups, 5% of the interviewed managers are 30–50 years old, while another 64.3% are older than 50 years old. Of all respondents in this group, 23.1% have managerial experience up to 10 years, 38.5%—from 10 to 20 years, 23.1%—from 20 to 30 years, and 15.4% have managerial experience of over 30 years. All respondents in this focus group represent agricultural organizations. The focus group “Workers/specialists.” This focus group included workers and specialists of agricultural organizations from 23 municipal districts of the Stavropol Krai. The age composition of this focus group is as follows: under 30–24% of the respondents; 30–50 years—71.4%; over 50 years—4.6%. As for work experience, 37% of the respondents in this focus group worked up to 10 years, 52.8%—from 10 to 20 years, 2.3%—from 20 to 30 years, and 15.4%—over 30 years. By type of activity, the respondents of this focus group were distributed as follows: 96% of the respondents represent the agricultural sector, 1.9%—the IT sector, 2.1%—science. The focus group “Experts.” This focus group is represented by independent experts who study the problems of the development of the agricultural sector of the economy. Describing the qualitative composition of this focus group, we note that it included 26 doctors of sciences and 39 candidates of sciences. By age structure, 31.9% of the respondents were under the age of 30, 52.7% were between the ages of 30 and 50, and 15.3% were over 50. The work experience of the respondents is as follows: up to 10 years— 15.4%, from 10 to 20 years— 51.9%, from 20 to 30 years – 17.3%, and over 30 years—15.4%. According to the types of activities, the experts were distributed as follows: 12.4%— agriculture, 18.9%—IT sector, 54.6%—science, 14.1%—management.
In total, during the study, 398 respondents were interviewed (176 workers and specialists, 52 heads of agricultural organizations, and 170 experts). A questionnaire form was developed for each focus group. It included an individual set of questions (focus group “Leaders” – 27 questions, focus group
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“Workers/specialists” – 25 questions, focus group “Experts” – 22 questions. The survey was conducted in the first quarter of 2018 in the Stavropol Krai. To assess predictiveness (the ability to predict the future state of the object under study and developed thinking in related fields of knowledge) of specialists in agricultural modernization and the digital economy, we used the following criteria: – Experience of practical work; – Experience in agriculture, management, and science, information and communication; – The higher education in the studied area; – The academic degree of doctor or candidate of sciences (for the focus group “experts”); – The value of the Hirsch index of the publication activity of the Russian Science Citation Index (the focus group “experts”); – Scientific publications on the problems of agricultural modernization and the digital economy; – Self-assessment score (assessed directly by the expert in terms of the competence in the studied problem). Each criterion was assessed on a five-point scale, resulting in the average rating of the expert. As a result of the ranking, 20% of the respondents with the lowest predictiveness rating were discarded and were not taken into account in the research results.
3 Results and Discussion It is necessary to proceed to the analysis of the data obtained from the questionnaire survey regarding the current state of the modernization of agricultural production. First of all, it was necessary to determine the attitude of respondents to “digital modernization.” As a result, it was revealed that 71.86% of all respondents have a positive attitude towards it, and 23.02% are neutral (Table 1). Table 1 Attitude towards digital modernization of agricultural production, % Opinion of respondents
Focus groups Managers
Workers/specialists
Experts
Positive
50.00
78.16
81.4
71.86
Neutral
34.62
19.54
10.47
23.02
Negative
11.54
2.30
3.64
4.42
3.85
0.00
4.49
0.88
Digital modernization in modern domestic conditions is impossible Source Compiled by the authors
Total
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It should be noted that the largest share of respondents with a favorable attitude to “digital modernization” was recorded in the focus group of experts (78.16%). In contrast, managers are generally more cautious about digital modernization. The smallest number of votes (0.88% of the total number of respondents) was given to the fact that “digital modernization in modern domestic conditions is impossible.” Nevertheless, almost 5% of experts note insurmountable barriers to the modernization of agriculture based on the principles of the digital economy. It should be noted that among all respondents under the age of 30, a positive attitude towards digital modernization of agricultural production was revealed in 84.2%, while a neutral one – 15.8%. In turn, 64.7% of respondents over the age of 50 have a positive attitude towards digital modernization, 17.9% are neutral, and 10.4% are negative. The fact that digital modernization is impossible in current domestic conditions was indicated by 7% of respondents in this age category. Thus, we can state a change in attitude towards digital modernization depending on the respondents’ age. The need for digital modernization was indicated by 60% of respondents. Within focus groups, there is a tendency towards a more favorable attitude of workers and specialists towards digital modernization than managers, 42.31% of whom note that modernization is needed, but there are not enough funds. Among the leaders, there is also a relatively high percentage of those who believe that the modernization of agricultural production is currently not needed (24%). Among the respondents under the age of 30, 63.16% were in favor of the need for modernization at the enterprise, 15.79% answered that modernization is needed, but there are no funds for its implementation, 21.05% answered that modernization is not needed. Among the respondents over 50, the following results were obtained – 52.79%, 29.46%, 17.75%. To the question of what is associated with the modernization of agricultural production to a greater extent, 53.7% of respondents noted that modernization is, first of all, the introduction of new technologies, including digital ones; 38.89% of respondents interpret modernization as the renewal of technology; 7.41% of respondents believe that modernization in agriculture should be marked with the renewal of biological assets (Table 2). In a focus group of experts, 80.41% of respondents noted that modernization is the introduction of new technologies, including digital ones, while 45.45% of heads of agricultural organizations and 64.95% of workers understand modernization as the renewal of technology. Table 2 Substantive interpretation of modernization transformations, % Technology
Focus groups
Total
Technology update
45.45
64.95
11.34
38.89
Updating biological assets
13.64
5.15
8.25
7.41
Introduction of new technologies, including 40.91 digital ones
29.90
80.41
53.70
Managers Workers/specialists Experts
Source Compiled by the authors
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To establish the etiological essence of such an economic category as “digital agroeconomics,” the respondents were asked to choose one of seven statements, which is most closely related to this concept. As a result, the focus group of “experts” interpreted digital agroeconomics as a field for the application of robotics technologies, “precision farming,” urbanized agriculture, modern breeding and biotechnology, organic farming, personalized and functional nutrition, remote control (47.67%), and etc.; 39.53% of experts indicated the fact that digital agroeconomics is, first of all, technical and technological, biological, and managerial renewal corresponding to the model of a circular (waste-free) economy and the principles of sustainable development. No less popular was the opinion that digital agroeconomics is interpreted as a change in the technological order in agriculture (33.72%) or an economy based on knowledge and information (20.93%). At the same time, the interpretation of digital agroeconomics as a system for optimizing information exchange of data was less popular (5.81%); mobile economy (11.63%); total penetration of Internet technologies (8.14%). The study also found that respondents aged over 50 refer to digital agroeconomics as the use of robotization technologies, “precision farming,” urbanized agriculture, modern breeding and biotechnology, organic farming (29.51%). They also associate this concept with the change in technological structure (28.56%). Respondents under the age of 30 associate digital agroeconomy with the mobile economy (24.71%), agroeconomy based on knowledge and information (26.18%), and optimization of information exchange of data (12.76%). Thus, for this category of respondents, digital modernization is not so much a technical update focused on efficient land cultivation, the use of higher quality seed materials, or the production of food with improved features. For them, it is rather a qualitative improvement of the information base for making management decisions based on a large array of information not considered previously. The respondents consider the technical (35.46%) and technological (33.55%) types of transformations to be the priority areas of modernization, while the biological (13.74%) and managerial modernization are less prior (16.29%). Evaluating the readiness of the agricultural organizations of the Stavropol Krai to modernize production, 26.92% of managers noted the full readiness of the workers of their enterprises. At the same time, 42.31% of the surveyed heads of agricultural organizations note the unpreparedness of workers. As the main reason for unpreparedness, they indicate the low qualification of key specialists and the unreadiness to improve professional competencies and skills necessary for successful work in the digital economy (Fig. 1). The respondents (focus groups “managers” and “workers/ specialists”) also noted insufficient resources (35.11%) and low qualifications of personnel as significant risks of modernization in the digital economy (21,37%). At the same time, 50% of the surveyed heads of agricultural organizations noted their readiness to carry out targeted, insignificant modernization, while in the focus group “workers/specialists,” this answer was supported only by 13.13% of respondents. It should be noted that, according to the respondents of the focus group “workers/specialists,” an important limitation of modernizing agricultural production
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Other, indicate; 19.23
371
Fully ready; 26.92
Not ready since they may lose their job; 11.54 Not ready due to insufficient qualifications and unwillingness to improve it; 42.31
Fig. 1 The readiness of employees to carry out modernization (focus group “managers”), % Source Compiled by the authors
in the digital economy is the lack of resources (42.42%). However, only 12.5% of the managers agree with this opinion. Talking about the readiness for the modernization in the digital economy in terms of the availability of resources and qualifications of personnel, there is a certain inconsistency of opinions between the leaders and workers of agricultural organizations, which, to some extent, hinders the introduction of innovations. At the same time, such reasons as general economic turbulence, that is, respondents noted the impact of crisis processes in the economy and the reluctance of owners to carry out modernization as not significant. The experience in carrying out significant transformations in economic activity is the most important factor in successful modernization. Only 26.17% of surveyed managers have local transformation experience, while 42.06% of managers and employees have no related experience. Among managers, 9.5% of respondents have significant experience in the technological reequipment of production, and 34.3% of managers have experience in transformation in related industries. Among workers and specialists, 46.51% of respondents have no experience of participation in modernization, 39.05% have experience at an insignificant local level, and 14.44% of employees have similar experience in related industries. The study showed that, in general, managers rate their experience in implementing elements of the digital economy significantly higher than employees and specialists. The official website is the most used of the presented elements of the digital economy. Of all the respondents, 59.7% of managers and employees indicated that they have a full-fledged website with detailed information about the company, its products, and services. The fact that the organization is moving from manual agricultural equipment to autopilot based on micro-geolocation and self-learning robots was noted by 12.95% of respondents. Another 12.95% indicated the experience in applying technological solutions in the field of integrated remote control of the compliance of agricultural production with environmental requirements and tracking the product supply chain (including GPS/GLONASS marking).
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Insignificant experience is noted in the use of such technologies as: – The introduction of robotic technologies in greenhouses, including in climatically unfavorable regions (9.35%); – The introduction of monitoring uncrewed aerial vehicles and electronic “shepherds” for grazing (2.88%); – The distribution of commercial solutions in the field of super-intensive plant cultivation based on technologies of robotization and verticalization (vertical farms) (2.16%). The questions about the elements of the digital economy and the conditions for their successful application remain quite controversial. During the survey, 41.23% of respondents noted that the organization uses digital technologies. Another 44.74% of respondents noted that such elements are partially used in the organization. A fairly positive view on the introduction of digital technologies in agriculture is also confirmed by the fact that only 6.14% of respondents noted that they do not consider it necessary to introduce elements of the digital economy. The digitalization of the economy and agriculture has significant effects. It was revealed that users within the framework of digitalization programs for agriculture expect the active development of domestic technical means for agriculture. This opinion is shared by 25.97% of all surveyed respondents. Another 23.38% believe that for a more effective modernization of agriculture in current conditions, it is necessary to approve the mandatory conduct of digital technologies at the legislative level, that is, state regulation of this process. In turn, 19.48% of respondents noted that the digitalization of agriculture depends on the qualifications of employees. These areas should become the key priorities of the state policy in agriculture for the coming years. The question of the goals, priorities, and targets of digital modernization of agriculture on the part of government institutions is quite controversial. The vast majority of respondents believe that digitalization should ultimately lead to an increase in labor productivity (12.03%), the most important priority of state policy in agriculture is also the transition to the concept of “smart agriculture” (11.82%), and enhancing the prestige of rural labor and preventing rural outflows (10.77%). Some respondents noted the high importance of digital technologies in such areas of agriculture as the transition to urbanized agriculture technologies (experts – 5%); transition to technologies of personalized and functional nutrition (workers/specialists – 6.54%); transition to the concept of organic agriculture (workers/specialists – 7.51%); combating the degradation of agro- and ecosystems (experts – 7.16%); increase in biodiversity and decrease in the rate of depletion of natural resources (managers – 8.06%). Regarding the benefits of using digital technologies, 23.76% of respondents answered that digital technologies, first of all, contribute to an increase in labor productivity; 18.5% of respondents noted that the introduction of digital technologies would increase the competitiveness of the economy in foreign markets; another 17.5% expressed their opinion in favor of the fact that they increase the speed of goods movement (Fig. 2).
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Fig. 2 Benefits of using digital technologies in agriculture Source Compiled by the authors
Managers are much more likely to answer that digital technologies are primarily used to increase productivity (38% of managers). In addition to this advantage, employees also noted the potential to improve the quality of manufactured products by introducing digital technologies (15.98%). In turn, 12.7% of experts identified such an advantage as attracting additional investors. Regarding the spread of digital technologies in agriculture, the most common statement was that elements of the digital economy are used in organizations with the most qualified personnel (20.44%). In the second place was the statement that a more active investment policy is needed for the spread of digital technologies (20.08%) (the most popular answer was in the focus group “experts” (25.58%)). Another 18.98% of respondents said that the high cost of technical means hinders the active introduction of digital technologies. The minimum number of respondents spoke in favor of factors limiting or hindering the development of digital technologies in agriculture. Among this group of factors, it is worth noting the following: – The presence of elements of the digital economy is determined solely by the requirements of shareholders and owners; – The introduction of digital technologies requires a constant request from the top management personnel (7.66%), and in the focus group of workers and specialists this opinion is shared by only 5.36% of respondents, which is significantly lower than in the focus groups of “managers” and “experts”;
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– Digital technologies are developed mainly abroad; digital technologies cannot be reproduced because farms do not have the necessary set of technical means (4.38%); – Digital technologies do not lead to a significant increase in labor productivity (2.55%).
4 Conclusion Thus, a comprehensive study of the main possibilities, prerequisites, and limitations of introducing digital technologies into the field of agricultural production made it possible to conclude that the participants, in the overwhelming majority, have a positive attitude towards digitalization agriculture. Only about a quarter is neutral. The need for digital modernization was confirmed by 60% of all respondents. The priority spheres of modernization are the technical and technological type of transformation. One-third of the interviewed managers noted the complete readiness of employees of their enterprises to modernize production. Finally, there is indeed a lack of consensus on the benefits of using digital technologies because the category “digital economy” is interpreted in different ways by different stakeholders.
References 1. Agrarian Science: FAO Agenda: Digitalizing agribusiness and smart climate agriculture. Agrarian Science, 6, 43–44 (2018). https://www.agrarianscience.org/single-post/2018/08/09 2. Andreeva GN, Badalyants SV, Bogatyreva TG et al (2018) The development of the digital economy in Russia as a key factor in economic growth and improving the quality of life of the population. Professional Science, Nizhny Novgorod 3. Arinicheva I.V., Bessarabova S.S., Lichot U.A.: The development of the digital economy in the agricultural sector. International Scientific Periodical “Modern Fundamental and Applied Researches,” 2(29), 36–38 (2018) 4. Avdeeva I.L.: The analysis of prospects for the development of the digital economy in Russia and abroad. In: Proceedings from Digital Economy and Industry 4.0: Problems and Prospects (pp. 19–25). St. Petersburg, Russia: Peter the Great St. Petersburg Polytechnic University (2017) 5. Bogoviz AV, Alekseev AN, Ragulina JV (2019) Budget limitations in the process of formation of the digital economy. Lecture Notes in Netw. Syst. 57:578–585 6. Fedorenko VF (2018) Digitalization of agriculture. Rural Mach. Equip. 6:2–9 7. Fedorov AD (2018) Digitalization of agriculture – a prerequisite for increasing its competitiveness. Nivy Rossii 5(160):36–39 8. Gokhberg LM, Ditkovsky KA, Kadyrov AR et al (2017) Methodological recommendations for statistical observation of innovative activities in agriculture and related sectors of the agroindustrial complex. Higher School of Economics, Moscow 9. Gordon T.J., Helmer O.: Report on a long-range forecasting study. Rand Paper P-2982. Santa Monica, CA: Rand Corporation (1964) 10. Kharchenko AA, Konyukhov VYu (2017) The digital economy as the economy of the future. ISTU Bulletin of Youth 3(27):17 11. Khitskov I.F., Petropavlovsky V.E. (2018) The digital sphere in agro-industrial complex diversification. FES: Finance. Economy 2:45–52
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12. McKinsey & Company. (n.d.). Digital Russia: a new reality. Analytical report of the Digital expert. http://www.mckinsey.com/~/media/McKinsey/Locations/Europe 13. National Institute of Science and Technology Policy (2005) The 8th science and technology Foresight survey – Delphi analysis. Tokyo, Japan 14. Negroponte N. (1995). Being digital New York, NY: Knopf. http://web.stanford.edu/class/sts 175/NewFiles/Negroponte.pdf 15. Prosecutor General’s Office of Russia. Vasily Burov. Lecture “Digital Economy.” [Video]. YouTube (2019). https://www.youtube.com/watch?v=KnQIxYUwlTw 16. Razumovskaya E.A. (2015) Algorithmization and programming. Wiley, St.Petersburg, Russia 17. Smorodinskaya N.V., Katukov D.D.: Key features and consequences of the Industrial revolution 4.0. Innovation, 10(228) (2017). http://inecon.org/docs/2017/Smorodinskaya_Katukov_ Innovation 18. Stefanova N.A., Sedova A.P.: Digital Economy Model. Karelian Sci. J. 6(1(18)), 91–93 (2017) 19. Sudarushkina I.V., Stefanova N.A.: Digital economy. Research Azimuth: Economics and Management, 6(1(18)), 182–184 (2017) 20. Ushache I.G.: Strategic approaches to the implementation of an innovative model of agricultural development. In: Modernization and Innovation – strategic directions for the development of the agro-industrial complex (pp 3–4). Moscow, Russia: Research and development center “Voskhod-A.” (2012) 21. Uzhinsky I.: Digital economy (2017). https://postnauka.ru/video/74646/ 22. World Bank Office in Russia: The development of the digital economy in Russia: international experience and practice (2017). http://www.vsemirnyjbank.org/ru/events/2017/01/26/buildingfoundations-digital-economy-russia 23. Yakutin YuV (2017) Russian economy: a digital transformation strategy (constructive criticism of the government program “Digital Economy of the Russian Federation”). Manage. Bus. Administration 4:27–52 24. Yudina TN (2016) Understanding the digital economy. Theoretical Econ. 3(33):12–16
Agricultural Economics
The Analysis of Hedging Instruments on the Exchange Commodity Market of Ukraine Anna N. Slobodianyk , Nadiia P. Reznik , and George D. Abuselidze
Abstract The paper highlights the main instruments of protection against price fluctuations on the agricultural exchange market of corn and analyses the use of hedging to minimize risks. Seasonality, fluctuations in production volumes, and natural and climatic conditions have a significant influence on the formation of prices for agricultural products. The combined influence of these factors increases the risks of agricultural business. Overcoming their negative impact on entrepreneurial activity in agriculture necessitates the use of progressive elements of market regulation, including hedging instruments. The agricultural sector of Ukraine is also marked with the inconsistency of regulatory mechanisms with the needs of subjects of market relations. According to the study, it was caused by the problem of price formation for agricultural products. The paper proves the necessity of using a scientific approach to solving problems and improving the national commodity exchange market to ensure its adequacy in the integration processes of the world economic space. The authors highlighted the main tools for protecting against price fluctuations in the agricultural exchange market of corn. They also analyzed ways to use hedging to minimize risks. Keywords Hedging instruments · Commodity exchange market · Exchange risks · Commodity derivatives
1 Introduction At the present stage of the economic development of a civilized commodity exchange market, Ukraine is required to introduce and apply such progressive types of exchange instruments as commodity derivatives, which can protect agricultural producers from the negative factors of the economic system and ensure transparency parity pricing.
A. N. Slobodianyk · N. P. Reznik National University of Life and Environmental Sciences of Ukraine, Kyiv, Ukraine G. D. Abuselidze (B) Batumi Shota Rustaveli State University, Batumi, Georgia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_42
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2 Materials and Methods Such foreign economists as B. Bansal, J. Villach, M. Daniel, S. DeKovni, G. Geman, A. A. Kandinsky, G. Kaufman, R. Kolb, T. Lofton, R. Mac-Donald, J. Marshall, J. Rezgo, E. Warren, A. D. Feldman, T. Francesca, and J. Hull studied instruments of exchange derivatives markets and the development of new strategies for their application. In Ukraine, a significant contribution to the study of problems associated with the development of the commodity exchange market was made by such scholars as R. P. Dudyak, A. B. Mashliy, A. S. Mograb, L. A. Primostka, N. P. Reznik, P. T. Sabluk, V. K. Savchenko, A. N. Slobodyanik, N. A. Solodky, O. M. Sokhatskaya, G. O. Shevchenko, and V. A. Yavorskaya. The formation, development, organization, and regulation of the Ukrainian stock exchange market of commodity derivatives for agricultural products remain insufficiently studied and require further research. Accordingly, this paper aims to evaluate and analyze hedging instruments, taking into account the specifics of the agricultural market of Ukraine. The authors used technical and fundamental analysis, data analysis, synthesis, graphical methods, and others.
3 Results Exchange trading is practically inaccessible to agricultural producers. This phenomenon is associated with small batches of the same type of product, difficulty in participating in tenders, and dependence on traders providing loans but is not adapted to play on stock prices. Since agricultural production is seasonal, there arises the need to apply for loans or advances. The classical variant is providing a bank loan and interest for it. In market conditions, advance payments of agricultural producers carry out forward transactions. However, forward contracts have not been appropriately developed in Ukraine, but it is stipulated that the system of state forward grain purchases should be introduced to replace the state collateral procurement regime. Let us consider the availability of tools for various categories of market participants (Table 1). Exchange instruments are not available to intermediary traders and farmers, but they can use an alternative hedging opportunity called the “Minimum price contract.” In turn, we define a contract with a minimum price as a forward transaction, which helps to establish a cash sale for a known quantity and quality of any given product for the next or deferred shipment period. In addition to spot sales, an option for setting a minimum cash price is added. The operator can fix the selling price at any time [7]. This contract was widely used in Ukraine when the market operator did not have the opportunity to enter the exchange market to conclude a futures or options contract. The advantages of this type of agreement are as follows:
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Table 1 The availability of exchange and OTC instruments for various participants in the agricultural sector The types of operators and tools available
Futures contract
Option contract
Forward transaction
Minimum price contract
Physical or spot market
International trader
Yes
Yes
Yes
Yes
Yes
Intermediary trader
No
No
Yes
Yes
Yes
Agroholdings with offshore offices
Yes
Yes
Yes
Yes
Yes
Farmers
No
No
Yes
Yes
Yes
Source Agritel BSH [2]
• The ability to catch an increase in the price of a futures contract by increasing the premium of an option; • The ability to fix the final price on the physical market at any time; • The provision of some leverage for obtaining a loan; • Limited risks without margin stake; • The size of the contract is often negotiable (less than 5,000 bushels) • There is no need to deal directly with market futures and options; • The ability to set a minimum price; help in decision making in production management. However, it has the following disadvantages: • Futures may go down, which may lead to the loss of the premium that the operator will pay for the deduction agreement for the call option • A person concluding this agreement is subject to a charge for services. This charge includes the price for the purchase of a call option, which is determined by the strike price, the price volatility, and the value of time; • Goods must be delivered to a specific elevator [6]. Let us look at an example of how the “contract with the lowest price” works in practice. For example, on October 1, a person decided that he needed to sell some of the grain to free up funds to cover other needs. However, he feels that the futures price has the potential for growth and would like to take part in the upward movement of futures. He decided to conclude a contract with a minimum price, which validity expires on February 24. By January 1, we get the following indicators: • • • •
Sale price in January: −5.70 USD; Premium paid for call option: −0.40 USD; Service fee (for this example): −0.05 USD; Minimum contract price: 5.25 USD.
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Scenario 1. Prices went up by February 1: • Minimum price as of October 1: 5.25 USD; • Premium paid for call option: +0.50 USD; • New spot price: 5.75 USD. This increase in the price of a call option indicates that the futures price has risen in March. At this time, the person can call his trader to sell the call option, eliminating the trading result with a profit of 0.50 USD of the minimum contract price and a net increase in the price of the physical market 0.05 USD instead of selling in on the physical market on January 1. Scenario 2. Prices went down by February 1: • Minimum price as of October 1: 5.25 USD; • Premium paid for call option: +0.25 USD; • New spot price: 5.50 USD. The decrease in the price of the call option indicates that the March futures price has declined. Although, as a result, the person will receive an increase in the minimum price. The price on the physical market is lower than the spot one when the person could make a sale for 5.70 USD on January 1 ADM [1]. Is it necessary to sell or wait for price increases? This is precisely the issue most farmers around the world face. There are reasons for this since even a small change in the price of agricultural products can have a significant impact on the whole margin of sales.
4 Discussion Currently, Ukrainian manufacturers have many options for selling agricultural products. The most popular way is to sell grain at the elevator. This way is popular since, in this case, fewer risks may arise when selling on the terms of CPT-port. However, as a rule, when selling in the port, one can get a higher price, even after deducting the logistics cost. Furthermore, most traders are ready to build long-term relationships with Ukrainian farmers and work on forwarding contracts. A great example of the effectiveness of forwarding contracts was seen in Ukraine in 2018. From spring to almost mid-June, corn prices in the world and Ukraine grew rapidly. This was mainly due to concerns over the US crop, where most analysts expected that dry weather could damage the corn crop. Thus, those producers who took advantage of the forward contract received a selling price of 10–20 USD/t higher (Fig. 1) at the price of September 2018. However, it must be noted that this is not even a peak pressure harvesting at prices in Ukraine. In fact, for each particular enterprise, it is necessary to build a separate strategy based on its specifics (what precisely the farms produce, how strong the need for cash flow is, if there is a possibility of own storage, or it is necessary to attract elevators).
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Fig. 1 Forward prices in Ukraine for corn for delivery on the terms of CPT-port in September Source Developed by the authors
Unfortunately, nowadays, in the physical market of Ukraine, there is no way to conclude a forward contract for the supply of corn for the harvest of the next year. For example, it is difficult to find a buyer of corn in the physical market under a forward contract long before delivery and when the price drop is predicted. This is precisely how the situation on the corn market will probably develop (a pessimistic option). The prices will fall, and for the delivery period (October-November), the price will be 145–160 USD/t on FOB conditions. This price does not suit in terms of planned profitability. Therefore, it is necessary to hedge part of corn production (10%) from falling prices for the sale of not physical goods under a forward contract (we do not have such an opportunity), but the sale of ten corn futures on the Chicago Board of Trade [CBOT]. Corn futures are almost the only commodity futures for the agro-industrial sector, presented in the TOP 10 of the most liquid futures in the world (Table 2). Electronic bidding covers 93% of the total asset trading. The size of open interest is 1,324,250 USD. Futures are presented under the ZC ticker: • • • •
The contract is traded from Monday to Friday from 2:00 to 21:15. For this asset, the exchange has a break from 15:15 to 17:30. The contract months are March, May, July, September, and December. The expiration date occurs on the last business day before the 15th calendar day of the delivery month. • The size of the corn futures contract is 5,000 bushels, and the price is indicated for 1 bushel of raw materials. • The minimum price change is 0.25 USD (12.5 USD when purchasing a full contract). On average, about 200,000 transactions with the nearest corn futures contract are made on the CBOT. It causes changes in price several dozen times per second and makes this market very liquid [3].
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The most significant number of corn futures contracts is at the CBOT. For this reason, the CBOT is often used to hedge price risks. Therefore, trading positions are opened on this exchange. It should be noted that corn futures of exclusively American origin are traded on the CBOT with the possibility of physical delivery to American elevators. Therefore, Ukrainian producers need to have information on the price difference between the physical corn market in Ukraine and the corn futures market on the CBOT. This difference is called the basis. If we buy a corn futures contract and corn prices rise, our futures contract’s price rises, since these two phenomena are interrelated. In this case, we profit from owning a futures contract and can fix this profit by selling a futures contract. On the contrary, when the price of corn falls, we will receive losses from owning a futures contract and must replenish the deposit. Additionally, we will have to pay our broker commission for the purchase or sale of a futures contract made for us. Such payment is not provided for forward contracts. We plan to sow corn in the spring and harvest in the fall. Nowadays, the price of corn is 240 USD per ton in CPT terms with delivery in March, and it suits us in terms of profitability per hectare. However, we cannot fix this price for the next-year crop of non-physical buyers who wanted to buy corn of the new crop today. That is, the physical market is still not working. In addition to the physical market, there is also a corn futures market, for example, at the CBOT. If the futures contract is sufficiently liquid, we can use it to hedge the risks of our price. The hedge works because the physical and futures prices of corn tend to rise or fall simultaneously, so losses on one side of the hedge are offset by incomes on the other. If prices for physical corn will fall in the future, then the money that we lose in the physical market will be offset by income from a short position in the corn futures market. For the futures markets to function correctly, the cash price of corn and the price of corn futures at the time of delivery must be the same. If the Table 2 The most liquid futures for agricultural products
Source (CME group, 2018)
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prices do not match, then hedging as the economic reason for the existence of any futures market becomes impossible [5].
5 Conclusion To ensure that cash and futures prices are equal when repaying a futures contract, it has historically been established that exchanges provide for the delivery of real goods to fulfill short futures positions. When cash prices are much higher than futures prices, trading arbitragers buy ending futures, take delivery of a futures contract, and sell a physical commodity on the cash market at an inflated price for a profit. Such actions of arbitrageurs can increase the pressure on cash prices and shift prices towards each other and equalize them. Conversely, when the prices of ending futures begin to exceed the SPOT prices (physical market), arbitrageurs sell futures, buy physical goods, store them, and deliver according to the futures contract terms. This continues until the cash and futures prices equalize, reducing the potential profit of arbitrageurs. Due to the actions of arbitrageurs, the prices of physical corn and the prices of corn futures are correlated, making it possible to perform hedges.
References 1. 2. 3. 4. 5.
ADM Fourth Quarter Highlights from 2018 (2018). http://www.adm.com Argitel, B.S.H. (n.d.) Export prices for corn. http://www.agritel.com/ua/product/bsh_gc_tc_ua CME Group Corn futures (2019). https://www.tradingview.com/x/hLcsDwcy/ CME Group (n.d.). Official website. www.cmegroup.com Slobodyanik AM (2016) The current state of derivatives on world stock markets. Sci. Papers InterRegional Acad. Personnel Manage. 50:130–135 6. Slobodyanik AM, Avramenko AK (2018) Futures trading as a way to solve the price problem in the commodity markets of Ukraine. Agroswit 7:37–44 7. Slobodyanik AM, Tarasovich LV (2017) Risks in the agrarian exchange market: essence and classification. Sci. Bull. Int. Human. Univ. 25(2):16–19
The Vegetable Seed Market in Russia: Incentive Proposals for Greater Development Vasiliy I. Nechaev , Pavel V. Mikhaylushkin , and Sergey A. Arzhantsev
Abstract The study examines the Russian vegetable seed market. The paper reveals the current state of vegetable seed production and seed use under international globalization. The findings reveal that domestic varieties and hybrids cover only 16% of the seed demand. The authors describe the positive results of a Russian company, “Gavrish,” developing protected ground varieties and hybrids, and successfully selling seeds overseas. The authors propose measures of state support for domestic breeding and seed farming. Keywords Seed market · Vegetable crops · Breeding · Seed farming · Support measures
1 Introduction The vegetable seed market is the combination of intellectual property assets (both domestic and foreign), market agents, legal mechanisms, and information tools, establishing the seed price and evaluating the acts of its purchase and sale (Ladatko and Nechaev [5]). According to the Federal State Budgetary Institution of Science “Federal Scientific Center for Vegetable Growing” [VNIISOK], domestic vegetable growers spend about 15–17 billion rubles annually on field vegetable seeds (the so-called “borscht set” that includes white cabbage (and its varieties), carrots, beets, and onions. According to official data, the total area allocated to these crops amounts to about 700 thousand The original version of this chapter was revised: The author’s affiliation has been amended. The correction to this chapter is available at https://doi.org/10.1007/978-3-030-73097-0_102 V. I. Nechaev (B) · P. V. Mikhaylushkin · S. A. Arzhantsev Federal Research Center of Agrarian Economy and Social Development of Rural Areas – All Russian Research Institute of Agricultural Economics, Moscow, Russia S. A. Arzhantsev e-mail: [email protected] P. V. Mikhaylushkin Kuban State Agrarian University, Krasnodar, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021, corrected publication 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_43
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ha. The area of Russian protected ground, including plastic and private greenhouses, amounts to about 12 thousand ha, whereas the total demand for seeds reaches 2–3 billion rubles (30–40 million USD). The VNIISOK estimates the demand for seeds produced by industrial greenhouses at about 1.3 billion rubles, where almost half (about 700 million rubles) account for the cost of seeds for cultivation within the supplementary lighting (photocultures). According to the VNIISOK, the areas of operating greenhouse facilities are about 2,200 ha, where 635 ha are equipped with supplementary lighting (photocultures). The average estimated cost of purchasing seeds is about 1.1 million rubles per 1 ha. The remaining 1,565 ha are allocated to conventionally grown vegetables with the average estimated cost of 600 million rubles, which amounts to 0.4 million rubles per 1 ha. Plastic greenhouses account for 10,000. Cumulatively, their seed demand reaches about 1 billion rubles (Gavrish [3]).
2 Materials and Methods During the study, we used an abstract-logical method (used when setting the goals and objectives of the study, justifying the proposed improvement directions for the industry state support), a monographic method (used in the research on the current state of vegetable seed market), and expert assessment which helps to determine the course for further development of vegetable seed market).
3 Results Table 1 shows the use of international and domestic results of selective breeding in Russia based on the expert assessment given by the VNIISOK. The data provided in Table 1 demonstrates that only 16% of the seed demand is covered by domestic varieties and hybrids (3% through state-operated breeding, 13% through private-owned breeding farms) (Razin [9]). The remaining 84% of the domestic vegetable seed market is divided among over 25 foreign breeding companies. The main ones are: 1. 2. 3. 4. 5. 6. 7. 8. 9. 10.
“Bayer/Monsanta” (“Royal Sluis,” “Bruinsma,” “Asgrow Vegetable Seeds,” “Petoseed,” “DeRuiter” Netherlands, “Nunhems” Germany); “Sengenta” (“Sluis&Groot” Switzerland); “RijkZwaan” (Netherlands); “Limagrain group” (“Vilmorin,” “Clause,” “Tezeir,” “Hazera,” “NickersonZwaan” France); “Sakata” (Japan); “Kitano” (Japan); “Kaneko” (Japan); “Taki”(Japan); “CoraSeed” (Italy); “La Semiorto Sementi” (Italy);
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Table 1 Expert assessment of the use of foreign and domestic major vegetable crop seeds in Russia (2018) No.
Crop
Area planted (A.P.), Thousand ha
Varieties and hybrids Foreign Thousand ha
Domestic % of A.P.
Total, Thousand ha
State-operated breeding
Private-owned breeding
thousand ha
% of A.P.
Thousand ha
% of A.P.
1
White cabbage
109
98
90
11
1
1
10
9
2
Carrot
105
89
85
16
5
5
11
11
3
Beetroot
49
38
78
11
3
7
8
15
4
Onion
84
76
90
8
0
0
8
10
5
Cucumber
60
57
95
3
0
1
3
5
6
Tomato
108
86
80
22
4
4
17
16
7
Bell pepper
40
20
50
20
2
5
18
45
555
465
84
90
16
3
75
13
Total
Source Compiled by the authors based on (Razin [9])
11. 12. 13. 14. 15.
“BASF” (“Hild Samen” Germany); “Yoksel” (Turkey); “Bayram Tohum” (Turkey); “MTN Tohum-seed” (Turkey); “Nong Woo Bio” (South Korea) and others).
Due to the substantial financial and scientific potential gained over 2 centuries of their existence and the strong budgetary support provided by their respective states and transnational enterprises, it is challenging to compete with them (Gavrish [2]). The VNIISOK provides scientific support for the development of vegetable breeding in Russia. The institution created domestic varieties and heterotic hybrids of vegetables and cucurbit crops. It also developed resource-efficient, environmentally safe, and high-precision technologies to cultivate new varieties and hybrids that take into account the specific and varietal features of crops. According to the Ministry of Education and Science of the Russian Federation, as of July 16, 2019, the research in vegetable breeding and vegetable growing within the subordinate institutions is conducted by 216 research scholars including 25 doctors of science, 102 candidates of science, and 14 post-graduate students (Medvedev [6]). Such organizations as (1) “Manul” (the production of mellittophilae cucumber for protected ground), (2) “N. Timofeev Selection Station” (produce white cabbage and other open ground crops), and (3) farming enterprise “Poisk” (plastic greenhouse and open ground) are leading Russian breeding companies within the real industrial sector equipped with personal breeding programs, research and production base. Currently, “Gavrish” is the largest Russian company creating protected and open ground vegetable varieties, hybrids, and seeds. It can compete with the leaders of
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the world seed market. Nowadays, more than 1,000 ha of Russian greenhouses are allocated to the hybrids of “Gavrish,” which is about 30% (according to some sources, the inventory area of Russian protected soil totals to about 2,000 ha). One out of three cucumbers and tomatoes is cultivated using the seeds of “Gavrish.” The list of its long-term clients includes more than 120 Russian greenhouses, including such Russian leaders as: – – – – – –
multi-unit agricultural enterprises “Moskovsky”; “Alekseevsky” state farm (Ufa); “Yuzhny” state farm (Ust-Dzheguta); “Vyborgec” farming enterprise (St. Petersburg); “Trubichino” (Veliky Novgorod); “Voronezhsky TK”; “Teplichnoye” (Saransk); “Oldeyevskaya” (Cheboksary).
These companies use such cucumber hybrids as F1 Kurazh, F1 Atlet, F1 Karambol, F1 Rais, F1 Taganka, F1 Yakimanka, F1 Mitridat, and F1 T-34 tomatoes which are on par with their foreign counterparts based on production and consumer indicators while surpassing them in cost. Recently, the development of domestic protected grounds is mainly aimed at increasing the greenhouse areas, producing vegetables, and implementing supplementary lighting (photoculture technologies). The short-term plans of investors and greenhouse plant owners include constructing greenhouse complexes equipped with photoculture across an area over 750 ha. In the next 2–3 years, we can expect an increase in the overall photoculture area up to 1,300 ha and the seed demand of 1.5–2 billion rubles. Nowadays, the major part of this area is allocated to cucumbers, and only a small fraction of it is designated to cultivate tomatoes. The most common and popular cucumber hybrid F1 Meva is a smooth surface mesocarp. Longer (30–32 cm), lissocarps (F1 Demarazh and F1 Imea), warty mesocarp (F1 Svyatogor), and brachyurous (10–12 cm) warty (F1 Kibriya and F1 Byorn) cucumbers are also widespread. A small but growing tomato segment is focused on the production of hybrids, the fruits of which are suitable for sale in packaged form, and provide the highest level of selling prices (cocktail, cherry, and carpal with different shapes and colors). The estimated demand for cucumber seeds amounts to about 45 million seeds (or 1,500 kg with three crop rotations). This demand is fully covered by foreign supplies (Gavrish [2]). Therefore, the latest and most promising part of the domestic protected ground is almost completely import-dependent. Without active actions from the state, this trend will continue in the foreseeable future.
4 Discussion As professor S. F. Gavrish, the academic advisor of the VNIISOK noted during the parliamentary hearing in the Federation Council of the Russian Federation on July 24, 2019, the Russian breeders need to create necessary conditions to develop
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competitive protected ground hybrids of cucumber and tomato for photocultureassisted cultivation. This must be done shortly to ensure the necessary level of food security in agriculture. Domestic greenhouses need to supply domestic production with financial resources currently spent on the purchase of imported seeds, thereby financing the breeding programs of foreign companies (Gavrish [3]). Mphafi et al. [7] also indicated the importance of state support for the development of breeding programs and the rise of vegetable growing profitability. According to S. F. Gavrish, Russian vegetable growers are not interested in purchasing domestic hybrids, not due to their pravity. Modern foreign greenhouse complexes are created and intended for the cultivation of foreign hybrids using foreign technologies. Equipment providers cannot guarantee a result under different conditions. Therefore, all the conditions and restrictions are laid down in the estimated business plans and bank-funded financial models. Thus, investors and agricultural producers are not going to change the greenhouse structure. S. F. Gavrish states that, if we want to grow domestic hybrids in modern greenhouse plants, it is necessary to attract investors and financial institutions interested in financing projects. It is also necessary to link the subsidization of bank interest rates to the obligation to occupy a specific part (no less than 10%) of the production space by domestic breeding hybrids. These actions must be laid down in the business plan and financial model. Subsidized state funds cannot be spent on foreign technologies and seeds. Similar data on the importance of breeding technologies in Nigeria are discussed in detail by Olarewaju et al. [8]. Following the correlation and regression analysis results, the authors established a high dependence (r = 0,92, p ≤ 0,001) on the applied technologies. However, they note that during the rainy season (April-August), the significance of these indicators is considerably reduced due to the oversaturation of the vegetable market (Olarewaju et al. [8]). It is also necessary to stimulate the demand for hybrids of domestic breeding by subsidizing up to 50% of their cost (similar measures are already implemented in Kazakhstan). Manufacturers of vegetable products will show economic interest in the purchase of domestic vegetable seeds. Thus, vegetable growers will direct their funds (equivalent to the amount of subsidization) to domestic breeding companies financing their research programs. At the same time, they will receive support from the state, reducing their seed purchase costs and the cost of their production. It is necessary to attract competent experts from leading greenhouse plants and breeding companies to form a list of modern competitive and promising crop hybrids for industrial production. These hybrids should also be subsidized so that vegetable growers would be interested in purchasing them. According to the employees of the VNIISOK, the increase in the production areas for domestic hybrids is not the only necessary step; it is also necessary to stimulate the production of seed and vegetable crop hybrids in Russia. The current state of the production of vegetable seeds in Russia leaves much to be desired. Only about 10% of the total demand for vegetable seeds is covered by seeds produced in Russia. Russian-based breeding companies prefer to produce seeds of their varieties in China, India, Italy, the USA, Australia, and other countries (Kumar et al. [4]). This
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fact not only does not correspond with the concept of food security in Russia but acts as its contradiction. Furthermore, the placement of unique hybrid seed production in other countries allows for the leak of the original parent form, which means that Russian scientific developments are likely to be used by competitors in their breeding programs (Afari-Sefa et al. [1]); Tindal [10]. The demand for Russian industrial greenhouse plants amounts to about 3–5 thousands kg of hybrid tomato and cucumber seeds. Most of that demand must be covered by domestic production. The implementation of these tasks is hindered by the lack of specialized seed-growing farms equipped with the necessary technological equipment and qualified personnel and a comparatively higher cost of heavily manual labor-oriented production than in the countries of South-East Asia. For example, the cultivation of tomato and cucumber hybrids is, in most cases, pollen from the stamens of the paternal form is transferred manually to the pistils’ stigma of the flowers of the mother form (Gavrish [3]). At this stage, it is necessary to create conditions to satisfy both the breeder (customer) and the seed producer (manufacturer) with the economically sound production of domestic vegetable seeds. The state should subsidize the production in volumes sufficient to set up the purchase price lower than the cost of foreign products and make a profit from seed production higher than from fresh vegetables. Such measures will allow us to relocate a significant part of seed production from foreign sources to Russian and to re-purpose a part of the available protected grounds from vegetable production to seed production. This process is especially important for old greenhouse plants currently on the verge of profitability and likely to go bankrupt shortly. State subsidization will support such companies, prolong the active use of existing properties, create additional jobs, and save significant funds in the economic turnover of the country. The tax burden reduction is the next tool that can help support domestic breeding companies (e.g., the reduction of the VAT value to the amount of 10%, or complete exemption from the VAT). To encourage the creation of modern breeding centers meeting the technical requirements of the latest generation, it is necessary to provide Capital Expenditures. Their amount should equal to 50% of the costs of breeding centers commissioned for operation and long-term provision (not less than ten years) of credit lines for their construction with mandatory interest rate subsidization. It should be noted that domestic breeding companies have significant export potential. For example, the Russian company “Gavrish” sells seeds of its hybrids in CIS countries (Ukraine, Belarus, Kazakhstan, Uzbekistan, Azerbaijan, Turkmenistan, etc.), Middle East countries (Turkey, Jordan, Egypt, Iran, Lebanon, Saudi Arabia, etc.), and European countries (The Netherlands, Italy, Greece, and Germany). The company opened sales offices in Ukraine, Belarus, Turkey, and Jordan to ensure these sales. To stimulate their activity and increase foreign trade turnover, it is necessary to establish a 30% subsidization of the exported seed cost (Gavrish [2]). This approach will have a positive impact on the trade balance of the country and will
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provide significant support to import-oriented scientific institutions. Only economically developed countries have selection programs and engage in the export of their intellectual property.
5 Conclusion To develop the market for vegetable seeds in Russia, it is necessary to implement the following support measures for domestic breeding and seed production: • To tie the subsidization of credit rate and the obligation to occupy at least 10% of the production area with domestic varieties and hybrids; • To subsidize up to 50% of the purchase of promising domestic hybrids for Russian vegetable growers; • To establish a procedure for subsidizing the production of vegetable seeds, depending on the volume of areas occupied under the varieties and hybrids of the originator; • To reduce the VAT for domestic breeding companies by 0–10%; • To provide for the payment of Capital Expenditures of 50% of the cost of the commissioned breeding centers; • To provide long-term (not less than ten years) credit lines with subsidized credit rates for the construction of breeding centers; • To establish a 30% subsidization of domestic varieties and hybrids exports. These proposals will help to renew the Russian seed-breeding companies and increase their competitiveness. An increase in the demand for domestic seeds will create conditions for increased investment in breeding and seed production of vegetable crops, both from existing breeding centers, large agricultural holding, and related industries.
References 1. Afari-Sefa V, Tenkouano A, Ojiewo CO, Keatinge JDH, Hughes Jd’A (2012) Vegetable breeding in Africa: constraints, complexity, and contributions toward achieving food and nutritional security. Food Security 4(1):115–127 2. Gavrish S.F.: Letter to the Chairman of the Federation Council Committee on agricultural policy, food policy, and environmental management A. P. Mayorov (2019) 3. Gavrish S.F. (July 16, 2019 No. 103/19). Moscow, Russia: VNIISOK (2019) 4. Kumar A, Yadav Sumita MK, Rohila AK (2019) Constraints faced by the farmers in the production and marketing of vegetables in Haryana. Indian J Agric Sci 89(1):153–160 5. Ladatko O.V., Nechaev V.I.: Intellectual property (reference book). Part 2, p. 328. Krasnodar, Russia: “Prosveshcheniye-YUG” LLC (2002) 6. Medvedev A.M.: Information materials on the scientific development of breeding and seed production in the Russian Federation Medvedev A. M./ Annex to the letter of the Ministry of education of Russia in the Federation Council Committee on agricultural policy, food policy, and environmental management (July 16, 2019 No. MN-1148/AM). Moscow, Russia: Ministry of Education and Science of the Russian Federation (2019)
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7. Mphafi K, Oyekale AS, Ndou P (2019) Effect of enterprise development support program on market participation and profit efficiency of indigenous vegetable production in South Africa. Appl Ecol Environ Res 17(3):6853–6864 8. Olarewaju BE, Ayinde JO, Torimiro DO, Alao OT, Oyedele DJ, Adebooye OC (2019) Knowledge, attitude, and practices (KAP) analysis of underutilized indigenous vegetables (UIVs) technologies among the Southwest young Nigerian farmers. Acta Hort 1238:165–176 9. Razin A.F.: Letter to the Chairman of the Federation Council Committee on agricultural policy, food policy, and environmental management Mayorov A.P. from Razin A. F. (July 9, 2019 No. 162). Vereya, Moscow Region, Russia: All-Russian Research Institute of Vegetable Breeding (the branch of FSBSI Federal Scientific Center for Vegetable Growing) (2019) 10. Tindall HD (1983) Vegetables in the Tropics. Cranfield Institute of Technology. Eng Silsoe, Bedford
Developing Breeding and Seed-Breeding in Russia: Organizational, Economic, and Legal Aspects Vasiliy I. Nechaev , Natalia A. Glechikova , and Aleksandr A. Seregin
Abstract The accelerated development of domestic selection and seed production in the context of globalization and integration is of paramount importance. The paper aims to identify priority measures aimed at full import substitution in breeding and seed production for several crops. In the process of research, foresight, comparative analysis, and monographic methods were used. The international experience was studied on the development of breeding and seed production of crops. Several organizational, economic, and legal tools and mechanisms for the development of selection and seed production in Russia are proposed. Keywords Selection · Seed production · State support · Legal support
1 Introduction Seeds and planting materials are the most critical components of innovative technologies for the cultivation of crops, determining the yield, efficiency, and competitiveness of domestic crop production (Nechaev and Gaponenko [9]. Recently, much has been done in Russia to ensure the accelerated development of breeding and seed production. The relevant measures of the State Program for the development of agriculture and the regulation of agricultural markets, raw materials, and food for 2013–2020 are being implemented [12]. It provides subsidies for elite seed production, reimbursement of a portion of direct costs for the construction or modernization of agricultural facilities, including breeding centers. Additionally, within the framework of the national project “Science” [13], it is planned to form a network of advanced infrastructure for innovation in agriculture, including at least 35 seed and breeding centers, five agricultural and technological parks, each of V. I. Nechaev (B) Federal Research Center of Agrarian Economy and Social Development of Rural Areas – All Russian Research Institute of Agricultural Economics, Moscow, Russia N. A. Glechikova · A. A. Seregin Azov-Black Sea Engineering Institute – Branch of the Don State Agrarian University, Zernograd, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_44
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which will provide an annual revenue of 1 billion rubles. At least 100 breeding achievements will be developed, however, according to the first vice-speaker of the Federation Council, A. P. Mayorov, despite the taken measures, the stable technological dependence of domestic farmers on foreign breeding achievements is still not overcome. The proportion of seeds of foreign selection for sugar beet is 97%, vegetables are 73%, sunflower – 61%, potato – 55%, and corn – 49%. According to experts, domestic breeding is in deep crisis and cannot compete with world leaders, except for some breeding programs. Moreover, an acute problem of seed production is the unacceptably slow introduction of new varieties into production. The protection of copyrights and rights of patent holders is currently not sufficient enough [2, 8]; Samygin et al. [15]; Gulyaeva et al. [5].
2 Materials and Methods The study aims to identify priority measures aimed at ensuring the accelerated development of crop breeding and seed production in Russia. During the research, the authors used such methods as foresight (with an expert assessment of the development directions of breeding and seed production), comparative analysis (with the study of the directions of state support for the studied sub-sector), and monographic (for assessing the organizational and economic mechanism and legal support for selection and seed production).
3 Results During the parliamentary hearings on July 24, 2019, in the Council of the Federation of the Federal Assembly of the Russian Federation “On a set of priority measures aimed at ensuring the accelerated development of domestic selection and seed production,” it was noted that, in conditions of intensification of agricultural production, the leading role is played by varieties, hybrids, and high-quality seeds. At the same time, domestic financial support for selection and seed production in Russia is 60 times less than what Bayer Western company spends on the selection [16]; Samygin et al. [15]. With such funding, domestic selection annually loses its position. For this purpose, it is necessary to study the dynamics of introducing new varieties and hybrids into the State Register of Selection Achievements approved for use (Table 1). Table 1 shows that the average annual number of applications filed by Russian breeders in 2014–2017 increased compared to 2010–2013. However, their share in the State Register of Selection Achievements for 2013–2017 decreased and amounted to 50.5% and 58.2% (in 2017). Several problems need to be addressed immediately:
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Table 1 The number of applications in the State Register of Selection Achievements approved for use Average per year
2014–2017 to 2010–2013, %
2010–2013
2014–2017
The number of applications submitted to the State Register
953.5
1,101.0
The number of selection achievements included in the State Register
709.5
743.5
The proportion of achievements of domestic breeding, % 2013
2017
115.5
54.3
50.5
104.8
60.2
58.2
Source: Developed by the authors based on (Federal State Budgetary Institution “Rosinformagroteh” [4]
– Increasing the effectiveness of protecting intellectual rights for breeding achievements and improving the system for collecting royalties for the use of certified seeds; – The reduction of interest on the value-added tax rate for seed products to 10%, as is customary in the Republic of Armenia [1]; – The introduction of industrial seed production for certain types of crops (especially cereal crops); – The development and implementation of promising technologies in breeding and seed production; – Increasing the effectiveness of control over the circulation of seeds; – Improving the system of state variety testing and registration of varieties; – The development and implementation of an information system in the field of selection and seed production, ensuring traceability of seeds; – Providing agricultural machinery for domestic selection and seed production; – Providing breeding and seed production with the necessary personnel. The lack of effective legislation in the country and the low level of responsibility for illegal actions in the field of seed production stimulates the development of the market of falsified seeds. The lack of clear rules and requirements leads to unfair competition. The Federal Service for Veterinary and Phytosanitary Surveillance (Rosselkhoznadzor) annually, during the measures of control and surveillance, reveals up to 30% of seeds not meeting the requirements of national standards (which are recommendatory) (Dunkvert [3]. In Russia, in the field of seed production of crops, there are about 150 national and interstate standards for products and methods for their testing. The development of these standards relates to the field of activity of the technical committee for standardization “Seeds and Planting Materials” (Labor Code 359). The responsibility
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for its maintaining is assigned to the Federal State Budgetary Institution “Russian Agricultural Center.” International experience in ensuring economic attractiveness (Li et al. [6, 11] in the field of selection and seed production based on public-private partnership deserves close attention. To this end, it is necessary to develop mechanisms for protecting the rights of both domestic and foreign investors investing in Russian breeding and seed production by amending the draft federal law “On Amending the Federal Law “On Seed Production” and other legislative acts of Russia. Additionally, it is necessary to improve the agrarian policy of the country in terms of bringing specific provisions of the Federal Law “On the Development of Agriculture” (December 29, 2006, No. 264-FZ) following some target instructions introduced by Resolution of the Government of the Russian Federation “On approval of the Federal scientific and technical program for the development of agriculture for 2017–2025” (August 25, 2017 No. 996, as amended on May 06, 2019). In the indicated federal law, there is no clearly defined goal and the main direction of state agrarian policy aimed at developing the industry through the creation and implementation of domestic varieties, breeding products, and production technologies in agricultural production. Moreover, the role of the government in creating conditions (primarily economic) is not traced for the creation and transfer of new knowledge from state scientific institutions to the private sector of the agricultural economy. In this regard, it is proposed that the goal of the above scientific and technical program be attributed to the main goals of the state agrarian policy and should be included in article 5 of the law. The same is proposed for the main task of the scientific and technical program, including it in the main directions of the state agrarian policy of the same article of the law. To consolidate budgetary allocation in the priority areas of scientific research, it is proposed to supplement the Subprogram “Development of selection and seed production of potatoes in the Russian Federation” [13] with two co-executors – The Russian Foundation for Basic Research and the Russian Science Foundation. They became part of the co-executors of the Federal Scientific and Technical Program for the Development of Agriculture for 2017–2025 (resolution of the Government of the Russian Federation of August 25, 2017 No. 996). Appendix 4 of the subprogram should include the amounts of funding for research in the field of potato breeding and seed production technology for 2020–2024 (in the amount of 50 million rubles at the rate of 10 grants of 1 million rubles each year and 300 million rubles at the rate of 10 grants of 6 million rubles each year) allocated from the budget to the funds annually. It is also advisable to add the state program of the Russian Federation “Scientific and Technical Development of the Russian Federation” [14] to Appendix 4 of the subprogram as a source of financing for measure 1 and provide 5,000 million rubles for these purposes for 2020–2024 at the rate of 10 projects for 100 million rubles every year.
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4 Discussion To accelerate the breeding process and the relevance of modern breeding work to the world level, it is necessary: – To work out the issue of increasing budgetary support for agricultural science and stimulating the influx of private investment in agricultural research and development, providing for a significant increase in the cost of applied research and their introduction into production; – To develop additional measures to stimulate agricultural producers to participate in the development of the results of scientific research in production, including providing them with preferential (5%) investment loans, compensation for part of the capital costs and tax preferences [10]; – To modernize the material and technical base of breeding organizations, providing them with modern equipment, including, for marker selection, analytical instruments, breeding equipment, greenhouse complexes, phytotrons to assess the winter hardiness of breeding samples; – To develop and implement investment projects for the construction of modern seed cleaning plants, warehouses, storage of original seeds, including those equipped with cooling systems for long-term storage; – To develop and introduce a system of penalties for violation of the rights of patent holders and copyrights of breeders into criminal and civil law, which will significantly reduce the number of counterfeit seeds (often of poor quality), which negatively affects the image of originating organizations; – It is necessary to amend the rules for the provision of state support to agricultural producers in the field of crop production in terms of providing them with subsidies, provided that the proportion of areas sown with seeds of domestic varieties (hybrids) should be at least 30% (depending on the crop, primarily sugar beet, potato, sunflower, corn, soy). This provision should be applied only to individual crops, for which, currently, in Russia, there is a high proportion of areas sown with foreign seeds. Furthermore, according to the requirement of the National Association of Corn and Sunflower Seed Producers [7], it is necessary to quote the import of seeds of foreign selection with the phased introduction of a limit of 5 years to 20% of the market demand, which is an urgent measure to regulate the domestic market of sunflower seeds. The subjects of Russia should take measures to ensure the use of seeds of crops of varieties or hybrids, which are included in the State register of selection achievements allowed for use in a specific tolerance region, as well as provided that their varietal and sowing qualities comply with GOST R 52325-2005 during agricultural work [14].
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5 Conclusion The proposed measures for improving the organizational and economic mechanism and legal support for the development of domestic selection and seed production of crops based on public-private partnerships will solve the challenges faced by the sub-sector and lay a solid foundation for its further development.
References 1. Avetisyan S, Avetisyan A (2014) Vegetable crops growing development problems in the Republic of Armenia. Acta Hort 1033:13–18 2. Bershitsky Y, Saifetdinov A (2018) Economic analysis and justification of the directions of the innovative development of the agricultural economics of the Krasnodar Krai. IOP Conf. Ser. Earth Environ. Sci. 274: 3. Dankvert, S.A.: The letter with proposals to the First Deputy Chairman of the Council of the Federation of the Federal Assembly of the Russian Federation N. V. Fedorov from S. A. Dankvert (July 17, 2019 No. FS-SD-3/18294). Moscow, Russia: Ministry of Agriculture of the Russian Federation (2019) 4. Federal State Budgetary Institution “Rosinformagroteh.” The state register of selection achievements approved for use. V.1. “Plant Varieties.” Rosinformagroteh, Moscow, Russia (2017) 5. Gulyaeva TI, Savkin VI, Kalinicheva EY, Sidorenko OV, Buraeva EV (2018) Modern organizational and economic aspects and staffing issues in breeding and seed production. J. Environ. Manage. Tourism 9(8):1789–1798 6. Li J, Lammerts van Bueren ET, Leeuwis C, Jiggins J (2014) Expressing the public value of plant genetic resources by organizing new relationships: the contribution of selected participatory plant breeding and market-based arrangements. J. Rural Stud. 36:182–196 7. Lobach, I.A.: The letter to the Chairman of the Committee of the Council of the Federation on Agrarian and Food Policy and Environmental Management A. P. Mayorov from I. A. Lobach (July 16, 2019 No. NAPSKiP-228/19-04). Krasnodar, Russia: Self-regulatory organization National Association of Corn and Sunflower Seed Producers (2019) 8. Mayorov, A.: Further improvement of legislation in the field of selection and seed production is a significant contribution to the country’s food security (2019). https://www.advis.ru/php/ print_news.php?id=B49CE64B-ACAB-4146-82F9-FF8B69D45B5A 9. Nechaev VI, Gaponenko AK (2013) The introduction of the newest biotechnologies is necessary for sustainable agricultural development and needs sufficient investments. Visegrad J. Bioecon. Sustain. Dev. 2(2):72–77 10. Petrikov, A.V.: The letter to A. P. Mayorov, Chairman of the Federation Council Committee on Agrarian and Food Policy and Environmental Management, from A. V. Petrikov (July 15, 2019 No. 101). Moscow, Russia: FSBSI Federal Research Center VNIIESKh branch VIAPI named after A. A. Nikonov (2019) 11. Rolland B, Fontaine L, Mailliard A, Gardet O, Heumez E, Walczak P, Le Campion A, Oury F-X (2017) From selection to cultivation with the support of all stakeholders: the first registration in France of two winter bread wheat varieties after value for cultivation and use evaluation in organic farming systems. Organic Agric. 7(1):73–81 12. Government of the Russian Federation: State program for the development of agriculture and regulation of agricultural products, raw materials, and food markets for 2013–2020 (July 14, 2012 No. 717). Moscow, Russia (2012). https://www.garant.ru/products/ipo/prime/doc/701 10644/#1000
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13. Government of the Russian Federation: The passport of the national project “Science” (December 24, 2018 No. 16) (2018). http://static.government.ru/media/files/vCAoi8zEXRVS uy2Yk7D8hvQbpbUSwO8y.pdf 14. Committee of the Council of the Federation on Agri-Food Policy and Environmental Management (2019) The recommendations of the parliamentary hearings on the topic: “On a set of priority measures aimed at ensuring the accelerated development of domestic selection and seed production” (July 24, 2019). Pavlovsk, Moscow, Russia 15. Samygin DY, Baryshnikov NG, Mizjurkina LA (2017) Design model for the development of the agrarian economy: food aspect. Econ. Region 13(2):591–603 16. Savchenko, N.: The letter to A. P. Mayorov, Chairman of the Federation Council Committee on Agrarian and Food Policy and Environmental Management, from N. Savchenko (July 17, 2019 No. 193). Pavlovsk, Russia: ZAO “Agrofirm Pavlovskaya Niva.” (2019)
VAT for Agricultural Producers: Changes, Advantages, and Disadvantages Zinaida P. Medelyaeva , Victoria B. Malitskaya , and Irina G. Zharkovskaya
Abstract Value Added Tax [VAT] is a significant tax both for the state since it allows attracting large amounts of funds to the Federal Budget, and for business. On the one hand, a business has to pay VAT to the budget, and, on the other, it gets refunds for large volumes of inventory purchases. Agricultural producers who switched to the unified agricultural tax were not considered to be VAT payers until January 1, 2019. Due to the adopted changes, these manufacturers received the status of VAT payers starting from 2019. The article discusses the positive and negative aspects associated with changes in the payment of VAT. Keywords Agricultural producers · Processing enterprises · VAT · 2019 changes
1 Introduction The value-added tax [VAT] is one of the essential taxes. It has a significant impact on the enterprise’s economy. Tax compliance affects the income and expenses of producers determining their final financial results (Malysh [7]). On January 1, 2004, the unified agricultural tax [UAT], a special tax regime, was introduced to agricultural producers. It is currently applied to the majority of agricultural organizations of various organizational and legal forms. The transition to this method required precise calculations since manufacturers benefited from paying income and property taxes (corporate income and corporate property taxes) and could incur substantial losses if it was impossible to receive a value-added tax refund. Thus, Z. P. Medelyaeva · I. G. Zharkovskaya (B) Voronezh State Agrarian University named after Emperor Peter the Great, Voronezh, Russia e-mail: [email protected] Z. P. Medelyaeva e-mail: [email protected] V. B. Malitskaya Plekhanov Russian University of Economics, Moscow, Russia e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_45
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many significant agricultural holdings acquiring large amounts of fixed and working capital chose the standard taxation method. This method allows them to pay corporate income tax and VAT, deducting the purchased assets and thereby, reducing the VAT for products sold. When calculating the VAT, processing enterprises incurred certain losses because agricultural producers under a special tax regime did not allocate VAT amounts. Thus, processing enterprises could not calculate these amounts for a deduction. Since January 1, 2019, the VAT payment for agricultural producers under a special tax regime was subject to several significant changes. Considering the changes in the Tax Code of the Russian Federation, manufacturers should carefully examine possible options for payment or non-payment of VAT and conduct comparative calculations to minimize this tax. This process should not go against the current legislation and should be facilitated by the organization and enforcement of internal control [5].
2 Materials and Methods Particular agricultural producers will remain the exemption that allows them to avoid VAT-payments. The income from agricultural activities in the preceding UAT period must not exceed the established annual limit (2019–90 million rubles, 2020–80 million rubles, 2021–70 million rubles, 2022–60 million rubles) (Federal Tax Service of Russia, [9]); Association “Peasant farms and organizations of agro-industrial complex of Siberia” [8]. If required, organizations with lower turnover can receive the status of VAT payers (Lyubogoshchinskaya, n.d.). Companies will no longer be able to include VAT from suppliers in their expenses when calculating the UAT, even if it does not have the status of VAT payer (even if the supplier issued a VAT invoice). In this situation, the business must calculate and compare the UAT amount with the payment and the exemption of VAT. As evidenced in practice, VAT refund covers paid VAT since the agricultural producer purchases working and fixed capital at a rate of 20% and sell agricultural products at a rate of 10%. Thus, many significant agricultural holdings currently remain under a standard taxation regime. VAT-payers need to control their contractors since partnerships with suppliers not subject to VAT will be unprofitable due to the inability to apply tax deduction from purchased assets. Moreover, it is necessary to make sure that contractors transfer VAT to the budget, which is not quite appropriate for a taxpaying agricultural producer. One should check the suppliers and create a profile for each supplier that includes data of constituent documents, certificates, decisions, etc. This procedure will help to confirm that the business is dealing with a reliable and law-abiding contractor. Recently, 99.7 thousand Russian agricultural producers paid UAT, including 22.8 thousand agricultural organizations and 76.9 thousand private-owned farms and individual entrepreneurs. Out of the total number (36.4 thousand), 63% are UAT payers. At the same time, about 12% of taxpayers (11.7 thousand) provided zero accounting in 2016, with 8.5 thousand agricultural organizations and 2.9 thousand individual
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entrepreneurs. The income of the budgets of various levels from UAT amounted to 11.4 billion rubles. The most significant amounts were transferred to the budget by the taxpayers of the Krasnodar Krai, Murmansk, and Sakhalin region (1,490, 1,480, and 1,410 million rubles, respectively) (Dyatlovskaya [3]).
3 Results We analyzed the taxation systems for agricultural producers in the Voronezh region (Table 1). In 2016–2018, of all agricultural taxpayers (about 480 organizations), 315, 439, and 444 organizations were charged for income tax and UAT, respectively. The rest did not have a taxable base for calculating these taxes. As shown in Table 1, recent years saw an increase in the number of taxpayers for income taxes. It indicates an improvement in the financial condition of agricultural producers and the emergence of a taxable base (profit in the form of the difference between income and expenses). If the number of income taxpayers increased by 12% over the past three years, the number of UAT payers increased by 72%. There was an increase in VAT by 35 taxpayers due to the tax base’s emergence and a rise in the number of organizations that wanted to get this taxpaying status due to the increased appeal to contractors. The following significant agricultural holdings pay corporate income tax: “Avangard-Agro Voronezh” LLC, “EkoNiva-APK” LLC, “Agroeco-Voronezh” LLC, “Agroeco-Vostok” LLC, “Agroeco-Yug” LLC, “APK-Agroeco” LLC. For 2018, about 30% (27.9%) of the income tax was accrued according to the data of large agricultural holdings. The total amounts of accrued taxes for agricultural taxpayers are shown in Table 2. During the analyzed period, there are no clear trends in accruals for corporate income tax and UAT. The indicators are unambiguously low for both tax systems in 2017, when prices for agricultural products were low due to high yields of grain and other crops. The amount of VAT transfers does not directly depend on the enterprise’s financial condition and is determined by the need to purchase fixed and working assets with an increase of 69% and 9%, respectively, over the years. The decrease in the company’s profit in the preceding year usually determines the reduction in Table 1 The number of agricultural producers, according to the main accrued taxes Years
Income tax
VAT
The number of agricultural organizations
Corporate income tax
Unified agricultural tax
2016
164
2017
166
151
151
477
273
174
477
2018
184
260
186
476
Source (Agricultural Enterprises of the Voronezh region, 2018–2019)
406 Table 2 The accrual of taxes due and payable by agricultural producers of the Voronezh region, thousand rubles
Z. P. Medelyaeva et al. Values
Years 2016
Corporate income tax
125,128
2017 106,035
2018 171,938
UAT
256,212
96,292
115,900
VAT
3,144,341
5,327,422
5,820,121
Source Calculated by the authors based on (Department of Economic Development of the Voronezh region, 2016–2018)
the purchase of assets in the current year and the VAT deductible. Generally, VAT paid to the budget is determined by the VAT received from the sale of products and deductions. In 2018, more than 40% of the VAT was paid by enterprises of the Liskinsky district. The “EkoNiva-APK” LLC, which sells products in large volumes, construct complexes for livestock, and purchase working assets (veterinary medicine, supplementary feeds, etc.), was the leader in terms of the VAT paid. Other VAT-paying agricultural holdings account for no more than 5% of this type of tax revenue to the budget. On average, one company paying VAT to the budget (except for “EkoNiva-APK” LLC) accounts for 17,736.9 thousand rubles. We assume that, when all agricultural producers switch to VAT payment, an additional 5.1 billion rubles will be transferred to the budget, which will increase the current revenues 1.8 times. According to our calculations, changes in VAT will increase the payments in UAT. Thus, the amount of VAT paid on purchased fixed and working assets will not be included in the expenses (as previously practiced), which will increase the UAT’s tax base. Therefore, agricultural producers are likely to find themselves at a greater disadvantage than the previously existing VAT regulations. The amount of VAT and UAT paid will increase. Discussing the potential benefits for agricultural producers, literary sources note that it is possible to deduct the amount of VAT paid when purchasing fixed and working assets and reducing the transferred VAT. In some cases, it is possible to receive compensation from the budget. However, this will only affect a small number of taxpayers, since the VAT for products sold under regular operation will be higher than the VAT for purchased inventory, given that the feed base of enterprises is domestically produced. Most of the seeds are also domestically produced. Not every agricultural producer can buy expensive fixed assets using their sources, while their subsidies-based purchase does not allow for a VAT refund. The new rules for VAT payment will affect processing and procurement enterprises, which will accept the amount of VAT allocated for the purchase of agricultural raw materials for reimbursement. These considerable amounts will significantly reduce VAT transfers of processing enterprises to the budget. Thus, according to preliminary calculations, the additional amount of deductible VAT for processing and procurement production enterprises in the Voronezh region may amount to about 6 billion rubles. This will affect the sale of agricultural raw materials and toll
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processing, which currently does not have a broad distribution, but used by particular agricultural producers and poses certain features in mutual settlement payments between clients and contractors.
4 Conclusion In our opinion, since processing and procurement enterprises can significantly reduce VAT transfers to the budget, it is possible to increase prices for raw materials supplied for processing. However, practice shows that during the grain harvest in the summer of 2019, grain prices significantly decreased (by more than 15% compared to 2018). Time will show the results of the changes in VAT. The Ministry of Finance of the Russian Federation forecasts positive effects in the form of increased demand for agricultural products, sales growth, and the formation of conditions for technical and technological modernization of production equipment, based on the fact of VAT deduction soon. On the other hand, many sources mention several risks, including: • The reduction of the revenue base of regional and local budgets, as the number of people paying taxes under the general tax regime, will decrease due to the growth of the popularity of the unified agricultural tax; • An increase in the tax burden of UAT payers, since VAT deduction excludes the right to take the amount of this tax into the expenses account; • An increase in prices for goods, works, and services resulting from an increase in the tax burden; • An increase in administrative burden on the business; VAT payment will require maintaining the necessary document flow for calculating VAT; • Strengthening tax control over UAT payers (Lyubogoshchinskaya, n.d.); Association “Peasant farms and organizations of the agro-industrial complex of Siberia” [8]. Thus, the cumulative effect of changes in VAT will be ambivalent. Based on the practical results, it will be possible to assess the suitability of the introduced changes and apply them to the simplified taxation system. The primary condition for this should be an increase in the economic efficiency of all participants in the agro-industrial complex. The economic efficiency of individual enterprises determines other types of efficiency of these enterprises and the successful functioning of the agro-industrial complex (Gorlanov et al. [4], pp. 5293–5298). It is the effective functioning of the Russian agro-industrial complex and all regions defined by the strategic documents for the medium and long term (Zakshevsky, Khitskov and Charykova [10], p. 212).
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References 1. Agricultural enterprises of the Voronezh region, (2018–2019). AgropromChernozemya. Voronezh, Russia: “Norma-Press” publishing house (2019) 2. Department of Economic Development of the Voronezh region, (2016–2018). Annual summary reports of agricultural organizations in the Voronezh region (2018) 3. Dyatlovskaya E.: Vladimir Putin allowed the regions to create “tax holidays” for farmers, Agroinvestor (2018). https://www.agroinvestor.ru/investments/news/29476-vladimir-putin-raz reshil-nalogovye-kanikuly-dlya-agrariev/ 4. Gorlanov SA, Medelyaeva ZP, Malitskaya VB, Chirkova MB, Kostyyukova EI (2019) Content analysis of the term “effectiveness” and the concepts of its quantitative characteristics. Indo Am. J. Pharmaceutical Sci. 6(3):5293–5298 5. Logvinova TI, Shirobokov VG (2018) Organization of risk-based internal control of financial results in agricultural enterprises. Audit 2:5–8 6. Lyubogoshchinskaya A. (n.d.): VAT for agricultural producers: calculation, benefits, and reports. Taxes and accounting. Online magazine. http://online-buhuchet.ru/nds-dlya-selxozpro izvoditelej-raschet-lgoty-otchetnost/ 7. Malysh EV (2017) Taxes and Taxation. Publishing House of the Ural Federal University, Yekaterinburg, Russia 8. Association “Peasant farms and organizations of the agro-industrial complex of Siberia.” (2019). Since January 1, 2019, all payers of the unified agricultural tax in Russia are VAT payers. http://akfhsibiri.ru/index.php/novosti/zakonodatelstvo/286-s-1-yanvarya-2019goda-vse-platelshchiki-edinogo-selkhoznaloga-v-rossii-yavlyayutsya-platelshchikami-nds 9. Federal Tax Service of Russia. (2018). Organizations and entrepreneurs under UAT will be required to pay VAT in (2019). https://www.nalog.ru/rn73/news/tax_doc_news/7788700/ 10. Zakshevsky V.G., Khitskov I.F., Charykova O.G.: Strategic directions for agricultural development in the Voronezh region. Voronezh, Russia: Research institute of economy and organization of agro-industrial complex of the Central Black-soil economic regio (2017)
Increasing the Efficiency of Horticulture in Russia Under Globalization of the Agricultural Economy Luiza A. Velibekova , Gasan D. Dogeev , and Magomed-Rasul A. Kaziev
Abstract The paper determines the main directions for improving the efficiency of horticulture in Russia under the globalization of the agricultural economy. The authors used the methods of economical and statistical analysis during the study. The paper reveals the industry’s current state and analyzes the dynamics of the change in plantations areas, crop productivity, and gross collection for 2000–2018. The key problems (low profitability of agricultural organizations, destroyed nursery base, outdated material and technical facilities, loss of skilled personnel, etc.) remain unresolved. The import of fruits and berries in Russia is currently on the rise. Its structure confirms that fruits that can be grown domestically are still imported. The authors note that this fact significantly reduces the country’s position in the world production of horticultural products. The following vital conditions contributing to the successful import substitution policy are presented within the study: the intensification of the industry, widespread use of scientific and technological progress, the attraction of investments, the improvement of the material and technical base, the introduction of innovations at all technological stages, an increase of business activities, an increase of state support. Keywords Horticulture · World production of fruits and berries · Import · Import substitution policy · Development · Competitiveness
1 Introduction Globalization is an essential characteristic of the modern world economy. Covering all sectors of the world economy, it could not but affect the agricultural sector, including horticulture, its leading industry. The demand for fruit is high, and there is a noticeable trend for an increase in their production volume. Therefore, the task of providing the population with fruits remains relevant and will be important in the future. L. A. Velibekova (B) · G. D. Dogeev · M.-R. A. Kaziev Federal Agrarian Scientific Center of the Republic of Dagestan, Makhachkala, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_46
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The development of this sector is crucial for Russia and has a significant impact on its economic efficiency. It acts as the basis for the stable functioning of the agricultural sector and a systemically important factor for other sectors of the agro-industrial complex, while also serving as a unique indicator of the country’s economic wellbeing. These factors necessitate the tasks for the development of commercial horticulture, the increase of competitiveness, the search for new market outlets, and the elimination of negative consequences of agricultural activities. Russia needs to engage in the world food market due to the increasing levels of globalization. Therefore, the national policy for the development of horticulture should be based on the development and use of world technologies, new varieties of fruit crops, standard requirements for the environmental cleanness of planting materials and products, reduction of environmental damage, increase in skilled personnel, outreach programs, and the development of food markets.
2 Materials and Methods This research uses the data provided by the Russian Federal State Statistics Service, materials from Russian periodical literature, and materials acquired from digital resources. Economic, statistical, and analytical methods were used as research methods.
3 Results About 800 million tons of fruit are produced annually in the world, with an average annual growth of 3%. The leading fruit producers are China, India, Brazil, the USA, and Indonesia. Russia produces about 2.5 million tons of fruit per year and ranks 38th in world production [4]. Domestic horticulture currently does not meet the world standards of fruit production. The main reasons for this include: • Low competitiveness of domestic producers of fruits, berries, and their derivative products with foreign agricultural producers and processors; • The predominance of old inefficient technologies, low innovation activity in the industry, and, as a result, low efficiency of the industry; • The monopoly of the processing and distribution sector that does not account for the problems of agricultural producers; • Imperfect approach to export–import policy; • Slow creation of modern market infrastructure; • The dependence of the industry on state support; • Poor land-utilization; • Shortage of skilled personnel.
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Fig. 1 The dynamics of the structure of fruit and berry production in Russia in farms of various categories, % Source (Federal State Statistics Service 2018)
The analysis of the organizational structure of fruit production shows several positive developments: the share of agricultural enterprises in 2000–2018 increased from 15.7% to 39%, while private subsidiary farms reduced from 81.4% to 65%. Private-owned farms occupy a small share in the total volume, but also show a gradual growth trend from 0.2% to 4.5% (Fig. 1). Thus, personal subsidiary farms of the population continue to act as main producers of fruits and berries. Such an organizational structure does not allow us to reach the production volumes necessary for internal self-sufficiency. It also does not allow us to apply intensive resource-saving technologies, improve the quality of products, and conduct innovation-based production (following global trends). As shown in Table 1, the area of fruit and berry plantations in 2018 decreased by 39.3% compared to 2000. At the same time, we can observe the decrease of plantation areas for almost all fruit tree species: 47% decrease for pome fruit trees, 27% decrease for stone fruit trees, 14.5% for nut trees, and 15.4% for subtropical fruit trees. However, compared with 2016, there is an increase in the plantation by 1.2% up to 465.8 thousand hectares (Federal State Statistics Service 2018). The yield of fruit and berry plantations in 2000–2018 increased by 72.9%. The gross collection for the specified period shows stable growth and an increase of 24% during the analyzed period. Such positive dynamics can be mainly attributed to the introduction of intensive gardens in the country’s main horticultural regions. Despite the recorded growth in production volume, Russia is significantly inferior to developed countries in terms of fresh fruit consumption per capita. A review of world consumption of fruits and berries showed that in economically developed countries, this indicator reaches the level of 120–180 kg per capita, while in Russia, it amounts to 53 kg. For example, according to the research of Y. I. Agirbov & R. R. Muhametzyanov, per capita consumption of fruits amounts to 149 kg in Italy, 167 kg in the Netherlands, 152 kg in Austria, 128 in the UK, and 140 kg in the USA per year [1].
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Table 1 The dynamics of the main indicators of horticulture development in Russia (in farms of all categories) Values
2000
Total of fruit and berry plantations, thousand ha
767.4
2005
2010
2015
2016
2017
2018
2018 in % of 2000
598.0
486.1
467.1
460.2
462.4
465.8
60.7
Chain growth – rate, %
78.0
81.3
96.1
98.5
100.5
100.7
–
Crop productivity, c/ha
47.3
49.2
77.3
88.4
78.0
71.6
172.9
114.2
104.0
157.1
114.4
88.2
91.8
–
2,403.8
2,148.9
2,675.3
3,055.1
2,682.0
3,337.0
89.4
89.4
124.5
114.2
87.8
124.4
41.4
Chain growth – rate, % Gross collection, thousand tonnes Chain growth rate, %
2,690.0
–
124
–
Source (Federal State Statistics Service 2018)
Professor A. A. Borisova notes that in countries with the average life expectancy over 80 years, the population consumes 250 kg of essential food products [8]. The missing quantities of fruits and berries are imported. The level of imports in this category of goods will grow due to the projected growth in the consumption of fresh fruits and berries. Data provided by the agricultural expert analytical center “AB-Center” shows that the total import of the main fruits in 2018 amounted to 5,033.1 thousand tonnes, which is 2.7% or 130.2 thousand tons more than in 2017. After two years of import, delivery increased by 21.1% (876.8 thousand tons), and by 26.4% (by 1,051.4 thousand tons) after three years [2]. It is commonly known that significant import increases the country’s dependence on imported supplies, reduces employment, increases risks, and creates problems for agricultural producers while displacing domestic products. The domestic market will always import fruits and berries for industrial production needs, of which in Russia, there are no favorable climatic conditions (citrus, subtropical, and tropical crops). Structural analysis of fresh fruit imports in 2017 shows that bananas and citrus take up the leading position among imported fruits and berries, accounting for about 20%, followed by pome fruit crops (13%). We can highlight a positive point by comparing these data with 2014, when citrus fruits amounted to 19%, followed by apples and pears, with bananas occupying the third
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place. Thus, the import structure shows that the availability of pome fruit and stone fruit crops of domestic production is currently on the rise [3]. The growing level of agricultural globalization significantly affects the problem of food self-sufficiency. Russia has several technological and manufacturing issues in this area. However, our country can increase the volume of plantation area, production, and fruits export. Therefore, it is necessary to focus on tomorrow’s technological solutions [5, 6, 9]. The state program for the development of agriculture and regulation of markets for agricultural products, raw materials, and food for 2013–2020 is of particular importance for horticulture since it defines the prospects for its development for eight years. This program also serves as a tool for adaptation to the WTO requirements and improving the competitiveness of products. An increasing number of Russian regions are involved in the development and implementation of programs to advance horticulture further. These programs aim to maintain the most problematic or essential for industry areas [7]. Due to the intense competition in the market, the key direction for increasing the production of high-quality fruits is the creation of intensive and super-intensive gardens with early commercial fruiting (2–3 years of the plantation) and industrial volumes gross collection, high yield, compact crown, etc. This allows for an increase in the economic efficiency of their production 1.5–25 times. The main requirement for accelerated implementation of intensive gardens and product compliance with international standards is high-tech and science-based fruit nurseries [7, 8]. Large specialized enterprises working on the principles of agro-industrial cooperation and integration have undisputed priority in the revival of industrial gardening. These enterprises implement modern technologies, professional expertise, and world production methods in nursery and horticulture. This is a necessary condition for providing the food industry with raw materials and meeting the population’s demand for fruit as a key component of the human diet.
4 Discussion In our opinion, it is impossible to overcome the unfavorable state of the industry and solve the problems of import substitution of fruits without a radical change in agricultural policy, transition to a resource-innovative model of development for all stages of the productive-economic chain, and rational use of natural and industrial factors. The development of domestic industrial gardening will largely depend on the state’s economic strength. The need to quickly resolve the issue of self-sufficiency suggests that it is advisable to strengthen state support to achieve a more dynamic production growth rate. Currently, the state support is carried out in the form of subsidizing agricultural production costs for uprooting, establishing, and caring for perennial plantings.
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The current import substitution policy is designed to consistently reach key macroeconomic objectives and create conditions for the sustainable long-term development of horticulture. It shows the need for economic consolidation and strengthening of intraregional production and trade links, which will allow us to largely abandon its large-scale imports and adapt to the global market conditions.
5 Conclusion Rational use of natural, industrial, and financial resources, as well as the accumulated scientific groundwork, will allow Russia to enter the world stage of industrial horticulture. Under the increasing integration of the world agricultural economy, the strategic directions for the development of domestic horticulture are as follows: – The introduction of a science-based nursery system that promotes the production of certified planting materials; – The transition of gardening to high-intensity plantings, using new high-yielding varieties resistant to diseases and pests; – The development of production intensification involves active use of intensive technologies, re-establishing breeding work, the improvement of plant protection, the development of scientific farming systems, and the use of high-performance and energy-saturated machines; – The introduction of innovations marked with the use of scientific and technological progress (including the field of biotechnology), and the development of highly efficient and environmentally friendly technologies for the manufacture, storage, processing, and transportation of fruits; – The establishment of domestic material and technical facilities on par with the world’s advanced technologies; – Maintaining a protectionist policy and policies for increasing incomes and domestic demand; – Technical and technological modernization of agricultural enterprises, the creation of conditions for the growth of business activity; – The restoration of market infrastructure in line with modern requirements and standards; – Reinforcement of inter-regional relations. Domestic horticulture development in the designated areas will lay the basis for long-term development, contribute to the transition to an innovative path, increase the technological efficiency of the industry, and its competitiveness in the world market.
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References 1. Agirbov YI, Muhamemetzyanov RR (2017) Current trends and economic problems of horticulture development in Russia. Econ Agric Process Enterp 12:14–20 2. Agribusiness Expert and Analytical Center “AB Center” (2019) On fruit imports to Russia in January-April 2019. https://ab-centre.ru/news/ob-importe-fruktov-v-rossiyu-v-yanvare-apr ele-2019-goda 3. Agroinvestor (2018) Russia has increased imports of fresh vegetables and fruits. https:// www.agroinvestor.ru/analytics/news/29470-rossiya-narastila-import-svezhikh-ovoshchey-ifruktov/ 4. International Independent Institute for the Analysis of Investment Policy (2017) Global fruit market. https://mniap.pf/analytics/Mirovoj-rynok-fruktov/ 5. Kosevich A, Kozhina V (2016) Features of Russian agricultural development within the conditions of the globalized world economy. Int Agric J 2:41–43 6. Kozhina VO (2016) Agribusiness in the conditions of globalization of the world economy. Vestnik RosNOU Man Society Ser 1:42–44 7. Kulikov IM, Medvedev SM (2009) The development of the fruit and berry subcomplex of the Russian agro-industrial complex in the context of globalization of world economic relations. Garden Vinicult 5:12–15 8. Kulikov IM, Borisova AA, Tumaeva TA (2016) The scientific basis of import substitution as a priority direction of modern agricultural science. Garden Vinicult 1:6–11 9. Kuzicheva NY (2011) Strategic problems and prospects of gardening placement in the conditions of “managed” globalization within the agricultural economy. https://cyberleninka. ru/article/n/strategicheskie-problemy-i-perspektivy-razmescheniya-sadovodstva-v-usloviyahupravlyaemoy-globalizatsii-agrarnoy-ekonomiki 10. Russian Federal State Statistics Service (n.d.) Regional Statistics. https://www.gks.ru/wps/ wcm/connect/rosstat_main/rosstat/ru/statistics/regional_statistics/
Climate Change as a Global Challenge in Agricultural Economics Maxim V. Zaloilo , Natalia V. Vlasova , and Dmitriy A. Pashentsev
Abstract In the 20th century, humanity faced climate change (global warming) adversely affecting agriculture (affecting soil fertility, crop yields, disease and animal deaths, water resources depletion, etc.). The study is based on general scientific methods of analysis and synthesis, induction, deduction, analogy, abstraction, and concretization. It aims to assess the negative impact of climate change on the agricultural sector of the economy while forecasting and modeling proposals for a possible solution to this global problem. This process is facilitated by the study of international and national experience in the legal regulation of climate change based on the formal and legal methods. The study proposes further consolidation of efforts at the national, sub-regional, regional, and international levels; the development of flexible international legal instruments; a combination of regulatory measures with national interests; the correlation of global sustainable development goals and alignment of political priorities; the increase in the role of basic and applied scientific research, including an interdisciplinary plan, which will allow taking environmental, economic and social aspects into account. Keywords Climate change · Agriculture · Sustainability
1 Introduction The problem of climate change acquired global status and became a topic of debate since the 1970s. Climate change poses a special risk for agriculture since it is the most dependent on natural conditions. The international community started to address this problem in 1976. The United Nations Framework Convention on Climate Change was adopted on May 9, 1992. This convention was signed by 197 countries. Its main M. V. Zaloilo (B) · N. V. Vlasova · D. A. Pashentsev Institute of Legislation and Comparative Law under the Government of the Russian Federation, Moscow, Russia N. V. Vlasova e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_47
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task is to stabilize the anthropogenic impact on the atmosphere without reducing agricultural production and maintaining further economic development on a sustainable basis. The Kyoto Protocol, adopted in 1997, obliges developed countries and emerging countries to reduce or stabilize greenhouse gas emissions. Conferences of the parties of the Convention are held annually. On September 25, 2015, The UN General Assembly adopted an agenda of Sustainable Development Goals (the 2030 Agenda), which consists of 17 goals, including urgent measures to combat climate change and its consequences. Chapter 3.7 of the 2017 Club of Rome Report “Come On! Capitalism, Short-termism, Population, and the Destruction of the Planet” is dedicated to the topic of climate change [9]. Different aspects of climate change are discussed using an interdisciplinary approach at the national level. Particular attention is paid to legal possibilities in an attempt to provide an adequate response to this global challenge [1, 4, 5]. This fact indicates the relevance of this study, devoted to the consideration of climate change as a global challenge to the agricultural economy and the identification of promising ways to solve this problem.
2 Methods The study was conducted based on general scientific methods as analysis, synthesis, induction, deduction, analogy, modeling, forecasting, abstraction, and concretization. In particular, models and forecasts for solving climate change as a global challenge to the agricultural economy were developed using modeling and forecasting methods. The specific scientific and legal method was used to analyze the international legal acts that regulate the goals, objectives, and main efforts to combating climate change.
3 Results Generally, climate change consists of statistical deviations of weather parameters on the Earth as a whole or in its regions from multi-year values over a certain period (decade, century, million years, etc.). The causes of climate change are diverse and consist of non-anthropogenic (internal and external) and anthropogenic factors. Non-anthropogenic factors include the tectonics of lithospheric plates, solar radiation, changes in the parameters of the Earth’s orbit and axis (Milankovitch cycles), volcanism. Nowadays, climate change, expressed through an increase in global temperature (global warming), is mostly (directly or indirectly) caused by human activities affecting the composition of the global atmosphere. In 2013, the Intergovernmental Panel on Climate Change stated that there is a 95% probability that human activity is the dominant cause of global warming observed since the mid-twentieth century [7]. In 2016, the Panel stated that the degree of confidence that climate change is a direct result of human activity reached the “gold standard” of five sigmas (99.9999% probability of a non-accidental result) [6].
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The consequences of climate change are distressing. Climate change acts as a cause for Arctic ice meltdown, sea-level increase, and the number of deserts. It increases the frequency of extreme weather events (floods, hurricanes, droughts), decreases the number of “favorable” weather days, and causes the extinction of species that inhabit coastal zones and islands. Climate change is also a threat to food security due to reduced crop yields; it harms public health. Greenhouse gas emissions also pose special risks, which can become irreversible and lead to a greenhouse effect on Earth comparable to that of Venus. Global warming and agriculture are interrelated. Thus, the first leads to the appearance of new pests and diseases, changes in the traditional set of crops, grown and established agricultural production technologies. Despite the technological progress in agriculture (for example, the selection of new plant species), climate conditions are crucial for the quantity and quality of crops. Greenhouse gas emissions lead to deforestation, reduced plant propagation, reduced quality of fertilizers, etc. At the same time, the agricultural industry, along with other sectors of the economy, can be considered the culprit for hydrocarbon emissions into the atmosphere, however, on a smaller scale. Over the past few decades, governments made efforts to limit greenhouse gas emissions and to simultaneously adapt to global warming through the application of geoengineering achievements, which is reflected in international documents, in particular, the UN Framework Convention on Climate Change of 1992. Geoengineering projects aim to manage solar radiation (increasing the reflectance of clouds by boosting their density through seawater injection) and greenhouse gas concentration levels (creation of biochar, air degassing). They are also used to decrease ice melting rates through aerosol dispersion over the Arctic region. However, the implementation of these projects may not be effective enough due to insufficient mastery of these studies. Thus, they may lead to instability or solve problems at the expense of creating new ones. In the 2030 Agenda, the issue of combating climate change and its consequences is confined to the adoption of measures aimed at improving the ability of the population and state institutions to adapt to dangerous climate events and expected natural disasters in all countries. It also focuses on the implementation of national policies that will adequately respond to the current climate change and education of the population on the topic of climate and its change. The Agenda also pays attention to the obligation incurred by developed member-countries of the UN Framework Convention on Climate Change to achieve an annual mobilization of $100 billion through joint efforts and channels to meet the demand of developing countries for effective mitigation measures in the field of climate change by 2020. The Agenda also calls for the full-scale operation of the Green Climate Fund through its prompt capitalization and the creation of mechanisms that will strengthen the capacity of planning and management in the least economically developed countries and small island states within the conditions of climate change. However, as already mentioned, the 2030 Agenda contains 17 sustainable development goals, of which only three are environmentally oriented. In this regard, in the 2017 Report, the Club of Rome expressed concern that the achievement of the
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eleven socio-economic goals set by the 2030 Agenda will make the achievement of its environmental goals impossible. An integrated approach to solving this problem is currently at play. For Russia, given its exceptional size, geographical position, diversity of climatic conditions, specific economic structure, social and demographic problems, and geopolitical interests, the problem of climate change is of paramount importance, which is reflected in policy and strategy documents of the country. The Climate Doctrine of the Russian Federation was approved under the order of the President of the Russian Federation (December 17, 2009 No 861-RP). It acts as the basis for the formation and implementation of national policy in climate change. Following the order of the Government of the Russian Federation No. 730-R of April 25, 2011, a comprehensive plan for its implementation for the period up to 2020 was approved. The Climate Doctrine of the Russian Federation calls climate change one of the most important international problems of the 21st century. The main directions of the Russian climate policy include improvement of the legal framework and the establishment of a state regulation system in the field of climate change countermeasures, the development of economic mechanisms aimed at the implementation of measures to mitigate the anthropogenic impact on the climate, scientific, informational and personnel support of programs aiming to mitigate anthropogenic effects on climate, international cooperation in the field of adoption and implementation of measures to mitigate the anthropogenic impact on climate. The implementation of these directions is carried out in close connection with other measures taken in the agricultural economy and aimed at its further development [8]. During the 2015 United Nations Climate Change Conference (COP-21), the President of the Russian Federation, V. V. Putin, stated the over-fulfillment of commitments accepted by the Russian Federation within the framework of the Kyoto Protocol. Russia managed to lower the levels of greenhouse gas emissions through modernization of the economy and the implementation of green energy-efficient technology, which allowed to slow the global warming process for almost a year [3]. During this conference, the Kyoto Protocol was replaced by the Paris Agreement adopted on December 12, 2015. The Paris Agreement aims to keep the increase in global average temperature “well below” 2 °C by the end of the 21st century compared with pre-industrial indicators and to intensify the attempts to limit the increase in temperature at 1.5 °C. The implementation of the Climate Doctrine of the Russian Federation and Russian contribution to measures in reducing the adverse effects of climate change are as follows: • The President of the Russian Federation signed the Executive Order No. 752 “On Reducing Greenhouse Gas Emissions” (September 30, 2013 No. 752), which, by 2020, aims to reduce emissions to 75% from the level of 1990. • The order of the Government of the Russian Federation (September 21, 2019 No. 1228) expressed Russia’s consent to adopt and follow the terms of the Paris agreement.
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• The national project “Ecology” is currently implemented. It is planned to adopt a Federal Law “On state regulation of greenhouse gas emissions,” the draft of which was already developed by The Ministry of Economic Development of the Russian Federation, and to create a draft strategy for long-term development with a low level of greenhouse gas emissions until 2050 [2]. We believe that the solution to the problem of combating climate change should be based on the following conditions: • • • • • • • • • • • •
The development of new technologies; The development of new business sectors of the low-carbon green economy; Combined efforts at the national, sub-regional, regional, and international levels; The combination of regulatory measures with national interests; The correlation of global sustainable development goals and correct prioritization of policies; The achievement of a balance between economic efficiency and social justice; The increasing role of scientific research; The comprehensive scientific analysis based on an interdisciplinary approach (fundamental and applied research in climate and related fields, legal research) that allows taking environmental, economic, and social aspects into account; Publicity, the open nature of the held events, public awareness of the significance of the problem, shared responsibility for climate change, public involvement in the problem-solving process, greening the society; Adequate reflection in legal regulators of the priorities for modern development related to the prevention of climate change and reduction of the negative impact on the environment; Universal introduction of carbon regulation based on an integrated approach (a combination of the three available models); The development of flexible international legal instruments (similar to the Paris Protocol replacing the Kyoto Protocol).
References 1. Bogolyubov SA, Nikonov RV (2018) Can the law save the climate? J Russian Law 4:166–169 2. Government of the Russian Federation (2019) On Russia’s participation in the Paris climate agreement. https://government.ru/news/37922/ 3. Informational Agency “Tass” (2015) Putin: The Russian Federation exceeded the Kyoto Protocol, “slowing down” global warming for almost a year https://tass.ru/politika/2485139 4. Khludeneva NI, Kichigin NV (2013) Law and ecology. J Russian Law 8:119–137 5. Kichigin NV, Khludeneva NI (2016) The climate of the planet in a focus of the law. J Russian Law 9:153–161 6. Santer BD, Bonfils CJW, Fu Q, Fyfe JC, Hegerl GC, Mears C, Cheng-Zhi Z (2019) Celebrating the anniversary of three key events in climate change science. Nat Clim Chang 9:180–182
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7. Stocker TF, Qin D, Plattner GK, Tignor M, Allen SK, Boschung J, Midgley PM. (eds) (2013) IPCC 2013: Climate Change 2013: The Physical Science Basis. Contribution of Working Group I to the Fifth Assessment Report of the Intergovernmental Panel on Climate Change. Cambridge University Press, Cambridge, UK, and New York, NY 8. Volkova N, Dorskaya A, Pashentsev D (2019) Trends in state regulation of agrarian relations in Russia: experience, problems, and prospects. IOP Conf Ser Earth Environ Sci 274:012061 9. Von Weizsaecker EU, Wijkman A (2018) Come On! Capitalism, Short-termism, Population, and the Destruction of the Planet. Springer-Verlag, New York
Production Prospects of Economic Entities in Agriculture of the Ryazan Region, Russia Olga A. Bodryagina , Svetlana G. Vezlomtseva , and Olesya A. Zarubina
Abstract The authors focus on the trends in the development of agriculture in the Ryazan Region for 2000–2018. The study compares the performance of economic entities of three categories. In conclusion, it is stated that agricultural organizations have significant prospects for a further increase in all types of crops and livestock. Farms and individual entrepreneurs can increase the production of grain and industrial crops. Households annually reduce their contribution to the overall results of agricultural production. Keywords Ryazan region · Agricultural sector · Production performance
1 Introduction Agriculture is one of the most critical sectors of the economy in every country since it ensures the population’s food security. Agriculture depends on the natural conditions of production, the development of production forces, and the rational use of available resource potential by all economic entities in the industry.
2 Materials and Methods The authors used the data from the “Agriculture, hunting, and forestry of the Ryazan Region” [5] and All-Russian Agricultural Census of 2016 [3]. The research methods are analysis and assessment of the dynamics of agricultural development in the region and three categories of economic entities over 18 years.
O. A. Bodryagina · S. G. Vezlomtseva (B) · O. A. Zarubina Academy of Law and Management of the Federal Penitentiary Service, Ryazan, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_48
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3 Results Russain Agriculture is represented by three main economic entities of agricultural production (collective agricultural organizations, population households, and privateowned farms (including individual entrepreneurs)). The share of these categories in the agricultural production (land area, gross output value, crop and livestock production, the volume of employment, and other) may differ in various Russian entities [1]. Thus, according to the All-Russian Agricultural Census of 2016, the share of agricultural land in the country was as follows: agricultural organizations amount to 63.4%, population households—8.8%, and privately-owned farms 27.8%. The results for the Ryazan Region are 77.2, 5.4, and 17.4%, respectively [3]. On the example of the Ryazan Region, we will evaluate the efficiency of agricultural production as a whole and within particular categories of economic entities based on the results of 2000–2018. Table 1 shows the main performance indicators of the industry. This data shows a tendency towards the reduction of the total farmland area during the analyzed period and, most notably, the reduction of arable land. A certain share of the arable land is transferred to the group of forage lands (hayfields and pastures). However, 106 thousand hectares of total farmland (4.4%) were withdrawn from the agricultural turnover over eighteen years. Before the agrarian reform Table 1 Main production indicators of agriculture in the Ryazan Region for 2000–2018 Value
2000
2005
2010
2017
2018
2,443.7
2,350.3
2,324.4
2,336.9
2,337.6
Arable land
1,588.3
1,466.5
1,467.6
1,474.9
1,475.4
Forage lands
766.1
833.7
812.2
825.9
862.2 160.6
Total area, thousand ha Farmlands
Number of animals at the end of the year, thousand Cattle, including cows
361.7
259.0
180.4
165.4
Pigs
109.2
82.7
142.0
219.1
239.8
Sheep and goats
62.7
42.7
55.7
59.9
62.7
Poultry
3,845
3,790
4,996
4,067
4,414.0
688.9
871.0
655.1
2,083.4
1,609.7
Gross output, thousand tonnes Grain Potato
538.6
488.7
209.5
352.7
321.7
Vegetables
144.3
100.6
91.2
99.9
84.4
Sugarbeet
149.0
235.4
212.7
352.7
232.2
Livestock and poultry (slaughter weight)
49.7
48.8
53.3
46.9
52.0
Milk
462.0
382.6
364.4
399.0
427.8
Eggs, million pcs
417.8
358.5
649.4
758.9
882.2
Source [5, 6]
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in 1990, the total area of farmland in the Ryazan Region was 2,526 thousand ha, including 1,822 thousand ha of arable land [1]. The reform focused on the withdrawal of inferior land from agricultural turnover. Nevertheless, the tendency to reduce the area of farmland indicates untapped opportunities for preservation of the main and irreplaceable natural resource of agriculture. The number of cattle continues to decline at a high rate. It was reduced 2.3 times (cow population reduced 2.7 times) over 18 years. The number of pigs increased 2.2 times; the numbers of sheep and goats continue to grow since 2005. By 2018, sheep and goats’ population was restored to the number recorded in 2000 [5]. The poultry population is unstable. However, there is a noticeable upward trend. Gross grain output is unstable, with a pronounced upward trend from 2017. In 2010, production fell sharply due to extremely adverse weather conditions. High growth rates can also be observed in the production of sugar beet and oil crops. On the other hand, there is a clear downward trend in the production of potatoes and vegetables. These trends are the result of changes in crop productivity, as well as in the structure of field crops and the areas allocated to them. From 2000 to 2018, the total sown area for all categories of economic entities decreased from 981 to 905 thousand ha (7.8%) [5, 6]. However, the sown area for grain crops for the period of 2000–2018 increased from 503 to 577 thousand ha (almost 13.7%). In 2000, the share of grain crops amounted to 51.3% of the total sown area; in 2018, it reached 63.7%. The sown area for all industrial crops in 2000–2018 grew annually at a high rate—from 18.3 to 140.3 thousand ha (7.7 times). At the same time, sugar beet crops decreased from 9.5 to 7.7 thousand ha, while oil crops increased from 8.6 to 139.7 thousand ha. Despite the reduction in sugar beet’s sown area, the gross collection increased from 149 to 232 thousand tonnes. Potato crops decreased from 46.3 thousand ha in 2000 to 23.1 thousand ha in 2018. The crop productivity increased from 118 to 148 c/ha, while gross collection decreased from 539 to 322 thousand tonnes [5, 6]. Open-ground vegetable crops also decreased from 8.9 to 6.5 thousand ha with a decrease in crop productivity from 160 to 155 c/ha and gross collection from 144 to 84.4 thousand tonnes, including closed-ground vegetables. The crop productivity of all crops (except vegetables) significantly increased in 2000–2018. This is mainly caused by an increase in the number of mineral fertilizers applied to crops. The data connected to the increase is as follows: • • • •
The average increase for all crops from 25 to 74 kg per hectare; Grain crops—from 31 to 76 kg; Sugar beet—from 85 to 282 kg; Potatoes—from 164 to 264 kg.
The indicators of livestock production are significantly inferior to farming. The cattle population sharply decreased. The volume of cattle weight gain in slaughter weight decreased from 23.4 to 14.6 thousand tonnes (by almost 40%). With a 2.2fold increase in the number of pigs, their slaughter weight increased from 16.3 to 32.4 thousand tonnes. For poultry farming, the slaughter weight decreased from 8.4
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to 3.9 thousand tonnes. Currently, poultry farming is focused on the increase in egg production. Cow productivity increased from 2,570 to 6,577 kg, although the gross milk output decreased by almost 9% [5, 6]. The reduction in the number of cattle, sheep, and goats, respectively, and the production of slaughter weight is mostly the result of a reduction in forage crops. In 2000, the share of these crops amounted to 41%, and in 2018 it decreased to 17.8%. The multiple reductions in the number of animals are responsible for increasing the level of their forage supply and productivity. However, there is a noticeable decrease in the gross output of both meat and milk. Let us consider the positions of three categories of economic entities in their overall results in the agricultural sector of the Ryazan Region. Table 2 shows the results of agricultural organizations’ activities. In 2000–2018, their number decreased 1.8 times. According to the All-Russian Agricultural Census of 2016, of the total number of agricultural organizations in the region: • • • •
24% of farms had up to 500 ha of land per farm, with an average of 206 ha; 37.1% of farms owned from 500.1 to 3,000 ha of land, with 1,598 ha per farm; 19.6% of farms owned from 3000.1 to 6,000 ha of land, with 4,116 ha per farm; 14.8% of farms owned more than 6,000 ha of land, with 11,472 ha per farm (including 7% with 15,457 ha per farm); • 4.5% of farms operated without land. Table 2 Production indicators of agricultural organizations of the Ryazan Region for 2000–2018 Value
2000
2005
2010
2017
2018
Number of organizations
547
416
425
302
300
Total area, thousand ha Farmlands
2,097.1 1,925.6 1,434.4 1,426.5 1,426.2
Arable land
1,438.8 1,269.0 958.7
951.1
950.7
Crops
899.8
728.6
653.0
751.8
753.1 136.6
The population of animals at the end of the year, thousand Cattle, including cows
288.3
214.3
152.2
140.2
Pigs
120.5
92.9
62.6
56.0
53.2
Sheep and goats
3.9
3.0
12.1
8.4
5.9
Grains
661.8
807.2
588.8
1,739.9 1,356.0
Potato
45.1
40.5
21.9
115.6
Vegetables
10.7
8.0
9.3
16.4
14.9
Sugar beet
140.5
206.6
186.2
298.1
205.2
Livestock and poultry (slaughter weight)
18.4
26.3
38.7
38.1
43.4
Gross output, thousand tonnes 131.4
Milk
277.9
276.6
284.6
344.3
368.2
Eggs, million pcs
269.0
237.0
563.3
697.5
823.2
Source [5, 6]
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Table 2 shows the trend of an annual reduction of farmland and arable land of agricultural organizations. It is a common practice to transfer that land to privateowned farms. The sown area continued to reduce annually until 2010. However, in subsequent years, it gradually grew due to the rational use of arable land. Thus, in 2000, the share of crops from the total area of arable land amounted to 62.5%, 57.4% in 2005, 68.1% in 2010, and 79.2% in 2018. Keeping in mind that 6–8% of the arable land is used as complete fallow, we can still see the reserves for the increase of cultivated area in 2018. The following structure of crops was formed (%) from 2000 to 2018: • • • •
Grain crops 53.5; 56.9; 65.9; 65.9; 63.6%; Industrial crops 2.0; 2.3; 7.8; 13.6; 16.1%; Potatoes and vegetables 0.5; 0.4; 0.8; 0.7; 0.8%; Forage crops 44.0; 40.4; 25.5; 19.8; 19.5%.
The decrease of forage crops caused an increase in grain and industrial crops. In 2000, the sown area of forage crops amounted to 395.2 thousand ha, but, by 2018, it decreased to 146.8 thousand ha (2.7 times). This led to a 2.1-fold reduction in the cattle population. The number of pigs increased by 5.7 times. The production volume increased significantly for almost all types of products. Despite the 2.3-fold reduction in the number of cows, milk production increased by 32.5% [5, 6]. However, the problems in cattle breeding were not resolved. Production in slaughter weight decreased from 12.2 to 9.6 thousand tonnes (more than 27%). If the consumption of feed for the production of 100 kg of milk decreased from 145 to 89 kg of feed units, the gain of cattle in 2018 amounted to 147 kg of feed units, despite the increase of concentrated feed share in the total volume of their consumption from 17.1% in 2000 to 31.7% in 2018. The regional importance of private-owned farms is currently on the rise. Their number increased from 2,412 in 2000 to 2,628 in 2018. The area of land provided to them increased by 82%, from 35.8 to 59.8 ha per farm. According to the All-Russian Agricultural Census of 2016, the following size structure of these farms was formed in the Ryazan Region: 38.2% of farms had 10 ha per farm, with an average of 5.1 ha; 19.3% of farms had 10.1–20 ha, with an average of 13.4 ha per farm 13.9% of farms had 20.1–50 ha, with an average of 32.9 ha per farm; 9.6% of farms had 50.1–100 ha, with an average of 74.1 ha per farm; 5.3% of farms had 100.1–200 ha, with an average of 147 ha per farm; 6% of farms had 500.1–1500 ha, with an average of 863 ha per farm; 1.6% of farms had more than 1,500 ha, with an average of 4,048 ha per farm [2]. Of the total number, 31.4% of the farms did not own land. The share of crops from arable land amounted to 33.8% in 2000, 40.4% in 2005, 77.1% in 2010, 106.5% in 2017, and 102.2% in 2018. That is, leased land was used. In 2000, the share of grain crops amounted to 80.6%, 2.0% for industrial crops, 0.8% for potatoes and vegetables, and 16.6% for forage crops. By 2018, the shares were as follows: 75.0%; 14.5%; 0.5% and 10.0%, respectively. The share of industrial crops increased 7.2
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times, due to the reduction of all crop types. The volume of crop production increased significantly: grain from 24.9 to 252.8 thousand tonnes (10.2 times), potatoes from 2.1 to 8.5 thousand tonnes (4 times), sugar beet from 7.6 to 27.0 thousand tonnes (3.6 times). The results in livestock production were relatively small. By 2018, the production of livestock and poultry in slaughter weight amounted to 400 tonnes, as well as 10.5 thousand tons of milk and 300 thousand eggs, i.e., the production mainly tried to cover the average family needs (Nikolaev, Litvina & Novikova, 2019). There is an upward trend in the number of families with private farms in the Ryazan Region. Their numbers grew from 274.4 in 2000 to 288.2 thousand in 2018, with 0.28 ha of land per farm and a total of 79.6 thousand ha. The number of families in horticultural associations is also rising (from 127.1 to 128.8 thousand), with an average of 0.1 ha of land per family, with a total of 13.0 thousand ha. The number of families in market-gardening associations decreased from 35.1 to 27.2 thousand, with an average of 0.15 ha of land per family and a total of 4 thousand ha. Private subsidiary farms owned by the rural population show a consistent decrease in sown areas: 56.5 thousand ha, 90.5% of arable land in 2000; 41.5 thousand ha, 66.2% of arable land in 2005; 34.7 thousand ha, 54.6% of arable land in 2010; 25.1 thousand ha, 39.5% of arable land in 2017; 21.5 thousand ha, 33.8% of arable land in 2018. Potatoes and vegetables take up the main part of the crop structure: 89% in 2000, 95.3% in 2018. 9.5% and 4.0% for forage crops, respectively. Potato and vegetable crops were currently on the decline from 50.1 thousand ha in 2000 to 20.5 thousand ha in 2017; 5.4 to 0.9 thousand ha for forage crops, respectively. Simultaneously, the number of rural population decreased from 396.8 to 315.6 thousand people (20.5%). The proportion of people above the working age, mostly working on family plots, slightly changed from 34.9% in 2000 to 34.1% in 2018. Thus, the reduction in sown areas occurs not only due to a decrease in the rural population but primarily due to a decrease in their interest in the production of agricultural products. In 2000, they produced 491.4 thousand tonnes of potatoes, and in 2018, the production amounted to 181.8 thousand tons (a 2.7-fold decrease). Respectively, 133.5 thousand tonnes of vegetables were produced in 2000, and 65.6 in 2018 (a twofold decrease). Livestock and poultry for slaughter went down from 31.1 to 8.2 thousand tonnes (3.8 times). Milk production decreased from 181.0 to 43.1 thousand tonnes (4.2 times). Egg production decreased from 148 to 58.7 million eggs (2.5 times). The decrease of interest in the manufacture of products is primarily the result of a significant complication of their sales (increased competition, increased transport costs, etc.). Therefore, the production is carried out mainly for family needs.
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4 Conclusions Our studies lead us to the following conclusions about the development of agricultural production in the Ryazan Region: 1)
Production prospects for commercial crops and livestock products mainly depend on the activities of agricultural organizations. Their share in the total output of the region is as follows: • • • • • • •
2) 3)
96.1% in 2000, 81.0% in 2018 for grains; 94.3 and 89.9% for sugar beet, respectively; 8.4 and 27.2% for potatoes; 7.4 and 9.2% for vegetables; 37.0 and 83.5% for livestock and poultry in slaughter weight; 60.1 and 87.3% for milk; 64.4 and 93.3% for eggs.
The production of private-owned farms can increase only in grain (an increase from 3.6 to 19.5%) and sugar beet (an increase from 5.1 to 17.8%). Households will continue to reduce their production activities. Their share in the production of potatoes decreased from 91.2 to 56.5%, vegetable production from 92.5 to 77.7%, livestock and poultry in slaughter weight from 62.6 to 15.8%, milk production from 39.2 to 10.4%, and egg production from 35.4 to 5.6%.
References 1. Bodryagina OA (2015) Rational land use as a condition for the growth of agricultural production in the region (Dissertation of Candidate of Economics). All-Russian Research Institute of Agricultural Economics, Moscow, Russia 2. Bodryagina OA (2017) The analysis of agricultural production of economic entities. Ryazan Region. J Econ Entrepr. 2(79):325–330 3. Federal State Statistics Service [Rosstat] (2017) Preliminary results of the All-Russian Agricultural Census, vol 2. Information & Publishing Center “Statistics of Russia”, Moscow, Russia 4. Nikolaev O, Litvina N, Novikova N (2019) The agricultural sector of Russia: analysis, problems, and trends. IOP Conf. Ser Earth Environ Sci 274:0152 5. Rosstat regional office of the Ryazan Region (2018) Agriculture, hunting, and forestry of the Ryazan Region. Ryazanstat, Ryazan, Russia 6. Rosstat regional office of the Ryazan Region (2019) Agriculture, hunting, and forestry of the Ryazan Region. Ryazanstat, Ryazan, Russia
Russian Fruit and Vegetable Markets and the Role of Consumer Cooperation in Their Development Svetlana M. Ryzhkova
and Valentina M. Kruchinina
Abstract Over the past years, the Russian government has been pursuing a policy of import substitution to increase the domestic production of agricultural products, including fruits and vegetables. Despite this, the consumption of fruits and vegetables per capita remains below the medical norm. Imports of fruits are more than twice as high as production. At the same time, there are countries (such as the Netherlands) that have provided citizens with a balanced consumption of fruits and vegetables. This paper aims to study the domestic market of fruits and vegetables, identify possible directions of its development and the role of consumer cooperation in achieving the goals, study international experience, and best practices to launch internal reserves. The paper used such methods as observation, abstraction, analysis, synthesis, comparison, dialectic, and logic, which helped the authors to study the work of experts on the subject published in periodicals and on the Internet and to evaluate the statistical reports of domestic and foreign services and institutions. In Russia, most fruits and vegetables are produced in households or peasant (farmer) enterprises rather than in agricultural organizations. Both experience difficulties in preserving and implementing a new crop. The measures taken by the government to establish agricultural cooperatives have not had the expected effect. Therefore, to include all producers in the market infrastructure, it is necessary to organize consumer cooperation and other alternative channels for the sale of fruits and vegetables without intermediaries. Keywords Fruits and vegetables · Market of fruits and vegetables · Consumer cooperation · Food market · Households · Peasant (farmer) enterprises · Sales · Sales channels · Consumer cooperatives · Competition · Marketing · Packaging
S. M. Ryzhkova (B) · V. M. Kruchinina Federal Research Center of Agrarian Economy and Social Development of Rural Areas – All Russian Research Institute of Agricultural Economics, Moscow, Russia e-mail: [email protected] V. M. Kruchinina e-mail: [email protected] © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_49
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S. M. Ryzhkova and V. M. Kruchinina
1 Introduction Different countries pay great attention to the development of the market for fruits and vegetables. The scientific community and international institutions indicate the need to include fruits and vegetables in the human diet in sufficient quantitates. Thus, the World Health Organization [WHO], in the Global Development Strategy for Nutrition, Physical Activity, and Health, adopted in May 2004, recommends that the population “increase the consumption of fruits and other plant products, including vegetables, unrefined grains, and nuts.” It is recommended that national governments develop national strategies in the field of diet and physical activity, providing “marketing, advertising, sponsorship, and market promotion” of fruits and vegetables [17]. The UN, in the 2030 Agenda for Sustainable Development, indicated that plant calories are significantly less resource-intensive than animal calories, and fresh vegetables and fruits are needed for healthy human life [15]. Russia, as a member of the UN, supports the current agenda of the international community. However, unfortunately, the taken measures do not bring the desired effect. Vegetables and fruits still occupy only 1/50 of consumer spending.
2 Materials and Methods The research materials are the authors’ achievements in the studied areas, papers, and works of scholars published in periodicals and the Internet. The authors analyzed the reports and collections published by the Federal State Statistics Service (FSSS) and the Federal Customs Service (FCS) and the annual reports of the Centrosoyuz of the Russian Federation. The research purpose is to determine the role of consumer cooperation in the development of the domestic market of fruits and vegetables. To solve the problem, the authors outlined the following tasks: the analysis of the domestic market of fruits and vegetables and identification of possible directions for its development, familiarization with the material and technical base of consumer cooperation, the study of international experience and applying best practices and technologies for the domestic fruit and vegetable market. The following scientific methods were used: observation, abstraction, comparison, analysis, and synthesis, as well as the monographic method.
3 Results The demand for vegetables and fruits in Russia is satisfied both due to domestic production and imports. Moreover, fruits are currently extremely dependent on imports [9]. Thus, in 2017, the import of fruit and berry products exceeded domestic production two times. This was not always the case in the market. In 1990–2000, the
Russian Fruit and Vegetable Markets …
433
volumes of imports were lower than domestic production (except 1991). In 2001, imports, for the first time, exceeded the production of fruits in Russia. This trend continues to this day ([11, 12], p. 406). In some years (for example, from 2010 to 2013), imports were 2.3–2.8 times higher than production. The situation is different for vegetables; their production is higher than imports. In the early 1990s, the import volume varied from 25 to 30% of the production volume. Then, it decreased to 11% (1993–1996) and gradually established at the level of 17%–20% (Table 1). Thus, the country depends on international markets for fruits and vegetables. Table 1 The balance of resources and use of fruits and vegetables in Russia, thousand tons Indicators
Years 1990
2017 to 2016, % 2000
2005
2015
2016
2017
Stocks at the 1,633 beginning of the year
907
1,503
2,252
1,976
1,972
Production
2,997
2,969
2,723
3,195
3,656
3,262
89.2
Import
2,520
2,640
4,613
6,512
6,518
6,677
102.4
Total resources
7,150
6,516
8,839
11,959 12,150 11,911
Production consumption
214
612
640
1,022
1,075
1,120
104.2
Loses
416
56
91
104
95
98
103.2
Export
20
47
99
140
169
211
124.9
Personal consumption
5,032
4,659
6,501
8,717
8,839
8,649
100.1
Stocks by the end of the year
1,468
1,142
1,508
1,976
1,972
1,833
93.0
Stocks at the 3,860 beginning of the year
4,979
6,647
7,131
7,304
7,365
100.8
Fruits and berries 99.9
98.0
Vegetables and gourds
Production
11,444 11,359 12,098 14,968 15,065 15,427 102.4
Import
2,911
Total resources
18,215 18,611 22,253 24,735 24,690 25,461 103.1
Production consumption
753
1,403
1,488
1,931
Loses
75
388
373
525
528
521
98.7
Export
261
169
898
198
269
248
92.2
Personal consumption
13,167 11,476 12,388 14,777 14,625 15,185 103.8
Stocks by the end of the year
3,309
Source [2]
2,273
5,175
3,508
7,106
2,626
7,304
2,321 1,903
7,365
2,669 1,931
7,576
115.0 101.5
102.9
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In quantitative terms, the production of fruits between 1990 and 2017 grew slowly, increasing by 8.8%. However, in the same period, imports grew at an incomparably high pace—2.5 times. The production of vegetables increased by 34.8%, while imports decreased by 8.3%. The increase in the stocks of fruits and vegetables in the Russian market affected the average per capita consumption of fruits and vegetables. Thus, in 2017, the consumption of vegetables and gourds grew by 21.4% compared to 2003 and amounted to 102 kg. However, this is below the medical norm by 27.1%. The consumption of fruits and berries increased significantly from 36 kg in 2003 to 73 kg in 2017 (2 times). However, the recommended medical norm (17%) was not achieved. In 2017, the structure of consumer spending on fruits amounted to 2.3% and vegetables—2.6%. Currently, most of the production falls into small business forms. About 80% of fresh fruits and vegetables, depending on the year, are produced by peasant (farmer) enterprises, individual entrepreneurs, and households (Table 2). Households stably grow more than half of domestic fruits and vegetables. In such groups as berries, they produce up to 98% of the production, up to 90% of the stone fruit, and up to 50% of the seed fruit ([11, 12], p. 410). The products produced in households are used for fresh or processed domestic consumption, distributed to relatives and acquaintances, and partially sold in local markets. The marketability of these market entities is extremely low, although the share of their production of fruits and vegetables significantly exceeds the shares of agricultural organizations and peasant (farmer) enterprises. In the Soviet period, a procurement system was Table 2 The structure of the production of fruits and vegetables by category of farms, % of total production Indicator
Years 2007
2017 to 2016, % 2010
2014
2015
2016
2017
Fruits, Berries, and Grapes Farms of all categories
100
100
100
100
100
100
–
Agricultural organizations
27.8
23.0
31.3
30.5
32.9
34.6
−1.7
Peasant (farmer) enterprises and individual entrepreneurs
1.2
2.5
2.4
3.1
2.9
4.2
+1.3
Households
71.0
74.5
66.3
66.4
64.2
61.2
−3.0
Indoor and outdoor vegetables Farms of all categories
100
100
100
100
100
100
−
Agricultural organizations
19.3
18.8
19.9
21.9
23.3
25.6
+2.2
Peasant (farmer) enterprises and individual entrepreneurs
8.8
12.9
16.3
18.2
18.1
19.0
+0.9
Households
71.9
68.3
63.8
59.9
58.6
55.4
−3.2
Source [2]
Russian Fruit and Vegetable Markets …
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actively operating in the consumer cooperation of the Centrosoyuz. The population handed over all surplus fruits and vegetables to procurement offices ([8], p. 262). In the late 1990s and early 2000, Centrosoyuz was also actively engaged in harvesting. The share of households in the purchased amount of vegetables was 50%, fruits and berries—40%. Such indicators were provided by cooperation between the state and the Centrosoyuz. Since 2003, the government has not included the Centrosoyuz in state programs and projects. Organizations of consumer cooperation are not mentioned in the current state program for the development of agriculture and regulation of food markets for 2013–2020. At the same time, the state took the path of creating new types of cooperatives—agricultural consumer cooperatives ([5], p. 158). However, even without government funding, Centrosoyuz was viable and retained most of its organizations. The analysis of the volume of purchases of vegetables and fruits indicates that, despite the lack of state funding from 2003 to 2008, there was an increase in purchases of vegetables and fruits in consumer cooperation, and, there was a significant decrease only from 2008 (Table 3). In 2018, 49.8 thousand tons of vegetables were purchased, which is 58% of the level of 2003. Compared to 2014 and 2017, the decrease was 28.1% and 1.4%. In 2018, 26.8 thousand tons of fruits and berries were harvested, which is lower than the indicators of 2003 by 29.9%, 2014—by 29.8%, and 2017— by 6.9%. Currently, from 20 to 25% of the total volume of purchases of fruits and berries is made from personal subsidiary farms of the population. On a national scale, this is still negligible. Thus, in 2017, 0.3% of the produced vegetables and 0.9% of the grown fruits were harvested. The organizations of the Central Union still have their logistics base: storage facilities, transport, fruit and vegetable workshops, shops, etc. Cooperative organizations have a certain number of storage facilities, which allows them to ensure the storage of products for several months, but it is reduced continuously ([10], p. 312). In 2018, for the first time in fifteen years, the material and technical base of harvesting, production, and marketing of vegetables and fruits strengthened. The number of fruit and vegetable storage facilities increased by 3.6 times, specialized pick-up points— by 15.5%, refrigerators—by 14.1%, fermentation and salting points—by 19.5%, cabbage pickling vats, vats, and cement pits—by 22.8%, trading bases—by 14.3% (Table 4). At the same time, the number of workshops for the production of canned Table 3 The volume of purchases of fruits and vegetables by organizations of the Centrosoyuz, thousand tons Product
Years 2003
2018 to 2003, 2018 to 2014, % 2008 2011 2014 2016 2017 2018 %
Vegetables 85.8
90.3
87.8
70.2
61.0
50.5
49.8
58.0
70.9
Fruits and berries
50.1
52.6
44.5
35.5
28.8
26.8
60.1
60.2
Source [1]
44.6
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Table 4 The material and technical base of organizations of Centrosoyuz for the packaging, production, and marketing of vegetables and fruits, units Name
2003
2014
2015
2016
2017
2018
2018 to 2003, %
2018 to 2017, %
Objects for harvesting vegetables and fruits in consumer cooperation in Russia, units Storages for vegetables, potatoes, and fruits
693
296
285
272
223
805
Shops-reception n.d centers, thousand pieces
11,330
9,620
9,856
7,791
6,387
Specialized reception points
2,136
772
640
665
554
Refrigerators
558
569
537
517
461
116.1
3.6 times
-
82.0
624
29.2
115.5
526
94.2
114.1
The number of workshops for the production of vegetables and fruits, units Workshops for the production of canned fruits and vegetables
105
26
24
28
25
24
22.8
96.0
Workshops for the processing of fruits and vegetables (drying, salting, etc.)
122
47
47
44
45
41
33.6
91.1
Fermentation points
176
60
49
46
41
49
27.8
119.5
Pickling vats, vats, cement pits
751
180
168
146
101
124
16.5
122.8
The number of warehouses and markets in the system of consumer cooperation, units Trading bases
200
58
59
65
56
64
32.0
114.3
Warehouses
8,205
4,381
4,102
4,415
3,933
3,680
44.8
93.6
Markets
n.d
183
157
181
152
140
-
92.1
Source [1]
fruits and vegetables, workshops for processing of vegetables and fruits (drying, pickling, etc.), warehouses, and markets was steadily declining. The government is pursuing an import substitution policy aimed at increasing domestic agricultural production, including fruits and vegetables. The growth of the production of fruits and vegetables in 2013–2017 occurred due to increased yields since there is no increase in the area under these crops. For example, the area under fruit plantations decreased from 263.9 thousand hectares in 2013 to 462.3 thousand hectares in 2017. Over the same period, sown areas under open-field vegetables
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decreased by 6.4%. However, the total area of the used greenhouses increased by 7.4% from 3,061.8 to 3,288.3 hectares. It is necessary to change the approach to the development of a market of fruits and vegetables to involve low-commodity farms in the market structure. Vegetable and fruit crops have specific properties (perishable nature, seasonality, volumetric nature), which imply specific requirements for the distribution infrastructure ([10], p. 310). However, neither peasant (farmer) enterprises, nor even households have sufficient financial resources to fulfill the requirements of retail chains or standards. Limited access to the market, low price of the product, the lack of storage and transport capacities, and the lack of marketing analysis reduce the ability of farmers or households to sell fruits and vegetables. One of the problems of the distribution infrastructure is modern packaging materials for packing, storage, and transportation of fruits and vegetables. In Russia, there is no special law on the packaging that would establish general requirements for packaging and its use, measures to prevent and reduce the formation of packaging and its waste, and the organization of a system for utilizing packaging and its waste. Such a law should also include a rule on liability for failure to comply with established requirements. Many countries have already adopted packaging laws, for example, Estonia. The law provides for the safety of materials for the production of packaging and the process of its disposal [4]. Modern ecological types of packaging appear on the European market. For example, the Polish company SoFruPak has developed cardboard packaging for fruits, which takes into account the needs of producers, sellers, and buyers focused on organic products [13]. Packaging SoFruPak is an alternative to plastic packaging in a modern ecological direction for a healthy diet. In Russia, more people consider the quality of food products. Therefore, domestic producers of fruits and vegetables should take into account market realities. Since most of the fruits and vegetables in Russia are produced on small farms, the purchase of modern packaging can be difficult for an individual small commodity producer of fruits and vegetables. The cooperation of producers of this type of agricultural products for the purchase of modern packaging systems with their subsequent use on the market would expand the circle of potential buyers. Using lightweight, safe, aesthetic, convenient, and practical packaging can be a marketing step in capturing a market niche. A consumer cooperative model as a market channel could help small producers of fruits and vegetables enter the market and become participants in the value chain. Cooperatives occupy a certain place in the marketing system of fruits and vegetables and have the following advantages: – Strengthening the supply chain of fruits and vegetables; – Strengthening relationships of small-business with high-value markets; – Expanding opportunities through integration into domestic value chains of domestic producers of fruits and vegetables; – Ensuring the efficiency and competitiveness of the Russian fruit and vegetable sector;
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– Consolidating deliveries and using economies of scale; – Facilitating communication between small producers and large agricultural processing organizations. Historically, consumer cooperatives were created to meet the needs of their members for quality food ([5], p. 7). In turn, a consumer cooperative for the sale of fruits and vegetables can attract peasant (farmer) enterprises, individual entrepreneurs, and households for the supply of vegetables, fruits, and berries on a contractual basis. It is easier for it to receive state support for the construction of own fruit storage. In our opinion, in addition to financial support, the state can help consumers and agricultural cooperatives by developing standard designs for storage facilities of different capacities and directions, as well as by creating a bank of these projects (e. g., in regional ministries of agriculture). Projects should be provided free of charge. State financing of the construction stage or soft loans with a minimum interest is also required. For the development of the industry, it is necessary to effectively use the existing economic potential and new forms of work in changing socio-economic conditions ([6], p. 269). The prospects for the successful operation of a consumer cooperative largely depend on the financial component. One can count on the support of potential buyers in addition to the funds of cooperative members in the modern world. In particular, Russia began to use the experience of foreign countries in raising funds— crowdfunding (a method of collecting a large number of small contributions, using an online platform to finance or capitalize a popular enterprise) ([3], p. 1). Concerning the market of fruits and vegetables, this can act as follows. Residents help the cooperative with cash, and the cooperative, in turn, delivers a certain amount of local vegetables and fruits at reasonable prices on schedule. An example of a successful cooperative is the Dutch marketing cooperative Voedingstuinbouw Nederland (VTN). In the Netherlands, fresh vegetables and fruits were sold through auctions organized by cooperatives owned by farmers. To strengthen its position in the market, the cooperative acquired several wholesale companies. Currently, VTN, a trendsetting organization, offers its manufacturing partners broad access to the market and maintains close ties in the supply chain in key national and international retail chains [16].
4 Discussion The involvement of small forms of farming and households in the economic turnover through the development of cooperation is a natural way to preserve rural lifestyles, reduce rural poverty, ensure food security, create jobs, saturate the diet of the population of Russia with fresh fruits and vegetables. Consumer cooperative organizations of the Centrosoyuz and cooperatives have enormous potential for delivering fruits and vegetables to those areas where neither the public nor private sectors work. According
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to A. V. Tkach and A. S. Nechitaylov, the activity of consumer cooperation is essential since the Central Union serves the rural population, which is not interesting for small businesses ([14], p. 70). The traditional participation of consumer cooperation in the procurement, processing, and marketing of vegetables and fruits is due to the maximum approximation of its organizations to agricultural producers. In general, cooperatives are “local institutions” that deal with “local needs,” use “local talents,” and are led by “local leaders.” In the post-Soviet period, cooperatives developed in Russia as a special sector, combining the strengths of both the public and private sectors, especially for meeting the needs of small farmers and weaker groups. The cooperative helps to ensure year-round employment and sustainable income from crops, vegetables, fruits, and livestock. The creation of consumer cooperatives by farmers to market their products will offer them an alternative channel for selling products without intermediaries. The closer farmers are to the consumers, the higher their share in the retail price [7].
5 Conclusion The policy of import substitution of fruits and vegetables, aimed at increasing domestic production, did not recently reach its goal. The demand for vegetables and fruits in Russia is satisfied both at the expense of domestic production and imports. The dependence on imports is currently extremely high for fruits. Thus, it is necessary to change the approach to the development of the market of fruits and vegetables and involve small agricultural producers in the market structure with the help of modern cooperatives and organizations of the Centrosoyuz which can offer them wider opportunities and a range of services, including improved access to markets, natural resources, information, communications, technology, loans, training, and warehouses. Consumer cooperatives need to assist small producers in decisionmaking at all levels, to support them in securing land-use rights, in negotiating better conditions for participation in farming or lower prices for such agricultural resources as seeds, fertilizers, and equipment, to help organize the marketing of fruits and vegetables to the final consumer. Due to this support, small producers can secure their livelihoods and play a more active role in meeting the growing demand for healthy food, particularly in vegetables and fruits, at markets of various levels. The synergistic effect of cooperation will favorably influence the development of the fruit and vegetable market. It is also necessary to expand state assistance to consumer cooperatives for the modernization of the material and technical base for sorting, packaging, processing, and storing fruits and vegetables. The Central Union should use the free funds of shareholders and the public, and the farmers should intensify the creation of consumer cooperatives to market their products, which will create an alternative channel for selling fruits and vegetables without intermediaries. Acknowledgements The authors would like to thank the Polish company SoFruPak and personally the commercial director Adam Sikorski for the provided information.
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References 1. Centrosoyuz (2018) The leading indicators of social and economic activity of consumer cooperation of the Russian Federation. Centrosoyuz Publishing, Moscow 2. Federal State Statistics Service (2018) Resources and use of fruits and vegetables in the Russian Federation, 1990–2018. https://www.gks.ru/enterprise_economy 3. Freedman DM, Nutting MR (2015) Equity crowdfunding for investors: a guide to risks, returns, regulations, funding portals, due diligence, and deal terms. Wiley, New York. https://doi.org/ 10.1002/9781118864876 4. Government of the Republic of Estonia (2004) The law of the Republic of Estonia “On packaging” (April 21, 2004), Tallinn, Estonia 5. Kruchinina VM (2015) Consumer cooperation in the system of Russian cooperation at the present stage (taking into account international experience). Publishing and Trading Corporation “Dashkov & K”, Moscow 6. Kruchinina VM (2016) Trends in the development of consumer cooperation of the Centrosoyuz system in the conditions of crisis phenomena in the economy. Herald Belgorod Univ Coop Econ Law 1(57):262–272 7. Ozkan B, Ilbasmis E, Brumfield RG (2016) Management of the production and marketing of fresh fruit and vegetables: a case study of the antalya province of Turkey. J Acta Hortic 1132:49–54. https://doi.org/10.17660/ActaHortic.2016.1132.7 8. Ryzhkova SM, Kruchinina VM (2015) The role of consumer cooperation in the modern development of horticultural products market. Herald Belgorod Univ Coop Econ Law 1(53):257–264 9. Ryzhkova SM (2015) The development of the market of fruits and vegetables in the Russian Federation. Publishing and Trading Corporation “Dashkov & K”, Moscow 10. Ryzhkova SM, Kruchinina VM (2015) The value of consumer cooperation for the development of the market of fruits and berries in the context of import substitution. Herald Belgorod Univ Coop Econ Law 3(55):307–315 11. Sharkova AV, Kilyachkov NA, Belobragin VV, Menshikova MA, Kurdyukova NO, Levitsky AV, Morozov MA (2019) The concept of effective entrepreneurship in the sphere of new solutions, projects, and hypotheses, 2nd edn. Publishing and Trading Corporation “Dashkov & K”, Moscow 12. Sharkova AV, Prudnikova AA, Kolesnik GV, Shapkina DD, Chaldaeva LA, Yarnykh EA, Dashkov LP (2019) Entrepreneurship development: concepts, digital technologies, effective system. Publishing and Trading Corporation “Dashkov & K”, Moscow 13. SoFruPak (2018) Official website. https://www.sofrupak.com 14. Tkach AV, Nechitaylov AS (2017) Consumer cooperation in the system of the food supply. Econ Agric Russia 5:67–73 15. United Nations (2015) The resolution adopted by the General Assembly “Transforming our world: the 2030 Agenda for Sustainable Development. The 2030 agenda for sustainable development” (September 25, 2015 A/RES/70/1). UN Publishing, New York 16. Voedingstuinbouw Nederland (VTN) (2018) Official website. https://www.thegreenery.com/ en/organisation/history 17. World Health Organization (2004) Global strategy on diet, physical activity, and health. WHO Publishing, Geneva
Forecasting the Volume of Beef Consumption in the Russian Market with Various Development Scenarios for Domestic Beef Cattle Breeding: Methods and Results Yuri I. Bershitsky
and Alexander R. Saifetdinov
Abstract The study develops a methodology and performs the calculations for the medium-term forecasting of beef consumption in Russia under the BAU (“business as usual”) and innovation scenario of domestic beef cattle breeding development. The scenarios are marked with a notable increase in the number of cattle of specialized meat breeds with associated changes in the technologies of reproduction, feeding, and housing of animals, as well as the development of a sub-sector without the indicated changes. The work analyzes methods for forecasting the development of agri-food markets. The scholars suggest a refined method for forecasting the demand of the population for new high-quality food products appearing on the market while accounting for the limited solvency of consumers and prices of products within the analyzed group. The study presents the results of the price environment analysis within the domestic agri-food market of one of the regions of the country. The work also covers the results of the analysis of the solvency of population with different incomes. The study proves further reduction of beef consumption in Russia without accelerated recovery and further domestic beef cattle breeding development. The paper determines the potential for growing beef consumption among the population of one of the leading agricultural regions within the country, as well as threshold values of monthly incomes and selling prices for beef to ensure its consumption in the amount of recommended medical standards. Keywords Beef cattle breeding · Beef · Agri-food markets · Price environment · Population solvency · Medical consumption standards · Demand forecasting · Forecasted scenarios for the development of sub-sector
1 Introduction Currently, the consumption of certain types of meat by Russian population is marked with significant deviations from the recommended medical standards. For instance, Y. I. Bershitsky · A. R. Saifetdinov (B) Kuban State Agrarian University named after I. T. Trubilin, Krasnodar, Russia © The Author(s), under exclusive license to Springer Nature Switzerland AG 2021 A. V. Bogoviz (ed.), The Challenge of Sustainability in Agricultural Systems, Lecture Notes in Networks and Systems 205, https://doi.org/10.1007/978-3-030-73097-0_50
441
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Y. I. Bershitsky and A. R. Saifetdinov
pork consumption exceeds the recommended norm 1.7 times, while the consumption of beef covers only 54% of the recommended amount. The significant increase in beef consumption among the population can be achieved only through exponential growth in cattle. The growth can be reached through the formation of a herd based on highly productive meat breeds using innovative technologies for reproduction, housing, and feeding. This process will ensure rapid growth in beef production, reduce cost, and improve its quality [5]. At the same time, the potential for growth will be primarily determined by current consumer preferences, price environment, and the solvency of the population. The study aims to develop a methodology for substantiating the medium-term forecast of beef consumption in Russia that accounts for the above factors and is subject to the recovery and innovative development of domestic beef cattle breeding. The methodology should account for the expected changes in the income of the population and price environment within the domestic agri-food market and consider the consumer preferences when introducing products with improved palatability. The proposed method is tested on the example of the Krasnodar Krai food market. The Krasnodar Krai currently holds the position of one of the leading agricultural regions of Russia.
2 Materials and Methods The methodological framework for forecasting the effective demand of the population using the concept of utility function was first developed and presented in the works of Samuelson [14, 15], Houthakker [10], and Afriat [1]. Later, non-parametric methods for constructing the utility function and forecasting the volume and structure of consumption were supplemented by Varian [16, 17]. The most significant contribution to predicting effective demand using parametric functions and systems of equations was made by Deaton and Muellbauer [7]. Some representatives of the domestic agricultural economy suggest using systems of balance equations describing the production and use of products, income, and expenses of the population when justifying the directions for the development of agri-food markets [2, 3, 12]. They also suggest taking into account the recommended medical consumption standards during forecasting. However, the achievement level for these standards is mostly determined by sales prices and the real income of the population. The prediction of effective demand for specific food products can be performed by constructing and analyzing time series equations, single- and multi-factor regression models, and the scenario method [4, 9, 11, 13, 18]. At the same time, the magnitude of effective demand is influenced by factors such as consumer preferences, real income, the pricing environment, population and sex-age structure, and the development of credit markets. It is quite challenging to take all factors into account when building regression models.
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The proposed method of forecasting market demand is based on the concepts of the utility function U (x), where x = (x 1 , x 2 ,…, x n ) is a set of n goods (x ∈ n+ ), and indifference surfaces connected to each other as a function and the surface of its level. The utility function is based on a set of data for the expenditure configuration E, which includes K purchases made by one or a group of similar consumers, marked with sets of goods and prices (E = {(x r ,pr )| r = 1,2,…,K}, where p = (p1 ,p2 ,…,pn ) is a set of prices (p ∈ n+ ), er = x r pr —purchase expenses in the r event). The utility function can be presented in the following formalized form: U x r = max U (x)| x pr ≤ er .
(1)
Methodological features of constructing the utility function (1) are presented in [1, 6]. Given that no consumer can afford to purchase an infinite number of any goods, the total amount of their expenses p’x will be limited by the amount of their income M (or the part of income that they are willing to spend), i.e., p x ≤ M, which is a linear restriction imposed on U(x) when searching for its maximum. In that case, to analyze changes in consumer behavior, we need to solve the following task: max U (x) : p x ≤ M, xi ≥ 0 .
(2)
Its solution is a consumer choice of x goods sold at forecasted prices, with a given budget constraint of M. This task is open to additional restrictions. For example, we can impose restrictions x i ≥ Ai , where Ai —is the medical consumption standard for specific food products: max U (x) : p x ≤ M, xi ≥i .
(3)
The model (3) can only approximately reflect the real behavior of the consumer, but the analysis of the value ratios (2) and (3) will allow us to assess the degree of compliance of taste preference and income level at current market prices with the medical norms of consumption of certain food products. If problems (2) and (3) are transformed into the following statement: U (x) : U (x) : , min M : max = max p x ≤ M, xi ≥ 0 p x ≤ M, xi ≥ Ai
(4)
then the solution of problem (4) will determine the minimum income of consumers. Thus, it is possible to meet their needs in compliance with the recommended medical standards at the current price level. The introduction of restrictions on the minimum rate of consumption of a particular product in the task (4) will determine the maximum allowable price level pj * for it, which will contribute to the consumption of such a product following the recommended medical standards:
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⎧ ⎪ ⎪ ⎪ ⎪ ⎪ ⎪ ⎨
⎫ ⎪ ⎫⎪ ⎪ ⎧ ⎪ ⎪ U (x) : ⎪ ⎪ ⎪ ⎬ ⎬ ⎨ U (x) : max max = max p x ≤ M, xi ≥ 0, , . ⎪ ⎪ ⎪ p x ≤ M, xi ≥ 0 ⎪ ⎪ ⎭⎪ ⎩ ⎪ ⎪ x j ≥ A j , i = j ⎪ ⎪ ⎪ ⎪ ⎪ ⎪ ⎩ ⎭ ∗ pj ≤ pj p ∗j :
(5)
It should be noted that the considered models do not analyze changes in consumer demand for a product of changing quality. When improving the quality of x 1 goods and other equal conditions, its consumer utility increases compared to the utility of x 2 . In this case, the last for each possible set of (x 1 , x 2 ) will be ready to leave a few more items x 2 in favor of the item x 1 . In this case, the indifference curves will change the angular coefficients at each of their points, and the optimal consumer choice will move to the right along the abscissa axis. Let us assume that there are some quality measures of the product x 1 applied by the consumer K x1 and K x 1 for its current and future state: K x 1 Px = 1 = ex1 , K x1 Px1
(6)
where Px1 and Px1 is, respectively, the price of the product before and after improving its quality. In this case, as a result of improving the quality of the x 1 product, its current price Px1 “decreases” relative to Px1 , the current price of the product x 2 will “increase” relative to Px2 (since its utility, according to the consumer, decreases relative to x 1 ). Thus, the new budget constraint can be represented in the following form: x1i
Px1 Px + x2i 2 = M, ex1 ex2
(7)
where x 1 i and x 2 i are the coordinates of a certain tangent point to the indifference curve, and M is the consumer’s solvency. The proposed method requires further expansion and refinement. Nevertheless, in general, it can be used as a tool for the preliminary assessment of the expected market demand for products with improved quality appearing on the market as a result of the innovative development of various sectors and sub-sectors of agriculture, including domestic beef cattle breeding.
3 Results and Discussion The proposed method was tested using data from a representative sample of consumer expenditures on basic food products in 2010–2018 in the regions of southern Russia.
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The analyzed food set included cottage cheese, rice, buckwheat, beef, pork, poultry, fish, potatoes, bread, and pasta. Figure 1 shows the dynamics of retail prices for various types of meat in the Krasnodar Krai. Figure 1 shows that, within the region, beef prices increased by 68% in 2010–2018, significantly higher than the increase in pork and poultry prices during this period (39% and 52%, respectively). In our opinion, this mainly determined the structural changes in meat consumption with the replacement of beef by cheaper pork. However, in 2015–2018, the growth rate of beef prices decreased markedly and amounted to only 4%, while the prices for pork and poultry increased by 8% and 15%, respectively. This change can be explained by the gradual increase in the number of beef cattle in the region. If this trend continues, we can expect corresponding changes in the consumption of various meat by the population. In recent years, the average nominal monthly income of the population in the Krasnodar Krai amounted to 32–34 thousand rubles and had a certain growth trend. In 2018, about half of the working population of the Krasnodar Krai had incomes of 15–35 thousand rubles per month, while the group with average monthly incomes below 15 thousand rubles amounted to 23% of the population in the region (Table 1). In 2010–2018, within the region, the average nominal income per capita doubled. However, over this period, the real dynamics of the population incomes were less favorable—in 2010–2018, the growth of real income amounted to 40%, with a decrease of 5% in 2014–2018. The decline in the real income of the population and the unclear prospects for their rapid recovery do not contribute to the development of domestic beef cattle breeding. Therefore, when justifying the medium-term forecast of beef consumption, it is necessary to take into account the threshold values of retail prices and the income of the population, which ensures the consumption of this product at the desired level. In the course of the research, a statistically significant utility function of the studied food set was obtained:
Fig. 1 The dynamics of market prices for various types of meat in the Krasnodar Krai. Source Compiled by the authors
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Table 1 The income of the population in the Krasnodar Krai Value
2010 2012
2014 2016 2018 2018 in % (Seq No.) to 2010
The population of age 16–70, thousand people
3772 3821
3913 3975 4018 106.5
including monthly income: 38.3 up to 10 thousand rubles, %
27.5
17.2
12.4
10.4
(−27.9)
10.1–15.0 thousand rubles, %
20.8
19.0
15.6
13.4
12.7
(−8,1)
15.1–25.0 thousand rubles, %
22.3
26.8
27.7
27.7
28.0
(5.7)
25.1–35.0 thousand rubles, %
9.4
12.67 16.4
18.2
19.1
(9.7)
35.1–45.0 thousand rubles, %
2.3
4.74
6.3
7.0
7.4
(5.1)
more than 45 thousand rubles, %
6.9
9.3
16.8
21.3
22.3
(15.4)
21.7
28.8
32.9
33.9
By a factor of 2
Average monthly nominal 16.9 income per capita, thousand rubles Source [8]
0,032 U = x10,029 x20,013 x30,013 x40,136 x50,134 x60,109 x70,053 x 0,053 x90,077 x10 , 8
(8)
where x 1 —cottage cheese, kg; x 2 —buckwheat, kg; x 3 —rice, kg; x 4 —beef, kg; x 5 —pork, kg; x 6 —poultry, kg; x 7 —fish, kg; x 8 —potatoes, kg; x 9 —bread, kg; x 10 — pasta, kg. The utility function (8) has a parametric form, and its estimation was performed by approximating the results of the equations described in detail by Bershitsky et al. [6]. In the course of evaluation parameters of the utility function (8), we obtained only positive values. Their sum does not exceed unity, which corresponds to the requirements of the increase and concavity of the utility function. The medium-term (up to 10 years) forecast of demand for beef in the Krasnodar Krai was made for the population with different income taking into account the expected changes in the price environment. Task (2) was supplemented with a restriction on providing the required annual nutrition for the considered product set for more accurate results. The restriction allowed us to correctly use the utility function (8) for predicting consumer behavior in population groups of different availability. Table 2 shows the results of the short-term scenario forecast for beef demand in the Krasnodar Krai under the innovative development of beef cattle breeding in the region, as well as in the case of its absence. Given the current level of the real income of the population and the lack of quality development of beef cattle breeding, beef consumption per capita in the Krasnodar Krai will remain at a deficient level (less than 12 kg per year). Beef consumption within consumer groups with the income below-average will vary in the range of
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447
Table 2 Short-term forecast of beef consumption in the Krasnodar Krai Value
Consumer groups with average monthly income, thousand rubles
Total and average
Less than 10.0
10.1–15.0
15.1–25.0
25.1–35.0
35.1–45.0
More than 45.0
Group population, thousands
419
511
1126
769
297
876
4018
Monthly income per capita, thousand rubles
50.0
33.9
22.7
32.3
42.3
48.4
50.4
36.9
The average 20.2 sum of yearly expenses on the acquisition of the food basket per capita, thousand rubles
Forecast of beef consumption per year, kg/person While maintaining the existing trends in meat cattle breeding within the region
3.2
4.7
9.6
15.7
17.3
18.1
11.9
Providing recovery and innovative development of the sub-sector
3.6
4.9
10.5
17.1
19.0
19.7
13.0
Source Compiled by the authors
3.2–9.6 kg. In this case, the total consumption of beef in the region will amount to about 48 thousand tons. Furthermore, the results demonstrated that the implementation of the scenario for the innovative development of beef cattle breeding in the region would not bring noticeable short-term positive changes in cattle meat consumption. This indicator can only reach up to 3.6–19.7 kg in a population with different income levels.
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Y. I. Bershitsky and A. R. Saifetdinov
Fig. 2 Medium-term forecast of beef consumption in the Krasnodar Krai
In the medium-term (up to 10 years), we can expect noticeable changes in the price environment on the food market within the region, as well as changes in the level of its population income. Consumer preferences will change accordingly to the improvement of food quality (Fig. 2). The forecasts used the expected values of retail food prices and the size of the nominal incomes of the population, calculated as geometric averages of the corresponding time series. When considering the scenario for the innovative development of domestic beef cattle breeding, we assumed that the increase in beef prices would be restrained by expanding the number of animals of highly productive meat breeds and switching to resource-saving technologies for their reproduction, housing, and feeding. In a BAU scenario with continued emphasis on dairy cattle, retail prices for beef will increase at a higher rate than pork and poultry. The calculations show that without the innovative development of domestic beef cattle breeding, beef consumption in the Krasnodar Krai may decrease in the next ten years to 8.8 kg per capita per year. If the scenario for the innovative transformation of the sub-sector is implemented, this indicator may reach 14.1 kg by the end of the forecast period, which is still significantly lower than the recommended medical consumption standards. Thus, the results demonstrate that the recovery and innovative development of domestic beef cattle breeding will help to reverse the recent negative trend in the domestic production and consumption of beef. Although, in the medium-term, it will not provide the recommended volume of these indicators. The solution of tasks (4) and (5) allowed us to determine the threshold values of retail prices and monthly incomes of the population, providing the recommended consumption of beef per capita of 20 kg per year (Table 3). Table 3 shows that beef consumption in the population with different incomes can only reach its recommended volume with a noticeable reduction in price. Thus, a group of people with an average monthly income of 20 thousand rubles can increase the consumption of beef to 20 kg per year only if the retail price is reduced to 165 rubles/kg, which is almost impossible in practice the higher cost of production. The
Forecasting the Volume of Beef Consumption in the Russian Market …
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Table 3 The estimated threshold values of retail prices and the monthly income of the population ensuring beef consumption following the recommended medical standards (20 kg per year) Value
Consumer groups with average monthly income, thousand rubles Less than 10.0
10.1–15.0
15.1–25.0
25.1–35.0
35.1–45.0
More than 45.0
Monthly income per capita, thousand rubles