INTERNATIONAL AGRICULTURE AND TRADE (Former USSR Update)--Summary 
                                                             October 25, 1996
            Approved by the World Agricultural Outlook Board
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This summary is published by the Economic Research Service, U.S. Department
of Agriculture, Washington, DC 20005-4788.  WRS-96-S3.  The complete
text of the report is available 2-3 working days following release of this
summary.
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Decline in Gross FSU Agricultural  Output To Slow in 1996 as Grain Production
Recovers; Meat Imports Remain Strong

Although gross agricultural output in the former Soviet Union (FSU) is
expected to decline again in 1996, the drop should be significantly less than
in 1995.  In Russia, gross agricultural output is expected to fall 3-5 percent
this year, versus drops of 12 percent and 8 percent in 1994 and 1995,
respectively.  After plummeting severely due to political/ethnic strife or
economic restructuring (or both) during the last 4 years, gross agricultural
output in many of the smaller FSU countries, including Armenia, Azerbaijan,
Georgia, and Kyrgyzstan, is projected to grow around 5 percent this year.  

Improved grain crops in most FSU countries and stabilized livestock output in
many of the smaller FSU countries are expected to slow the contraction of the
FSU farm sector in 1996.  However, continued downsizing of the much larger
Russian, Ukrainian, and Kazak livestock sectors continues to outweigh recovery
in grain production and is driving the overall fall in agricultural output. 
Animal numbers in Russia, Ukraine, Kazakstan are expected to drop an average
of nearly 10 percent between January 1, 1996 and January 1, 1997.      

Despite weather-related difficulties in Ukraine and parts of  Russia, total
FSU grain output rose this year for the first time since 1992.  As of October,
USDA projects 1996/97 FSU grain output (including wheat and coarse grains) at
122.5 million tons cleanweight, up 3 percent from 1995/96.  All of the
increase is due to higher yields, which are projected up about 6 percent, as
total area sown continues to shrink for the 16th straight year.

Within the FSU region, agricultural trade policy continues generally to move
away from controls on exports toward restrictions on imports.  In particular,
agricultural protectionism is growing in the more reformist nations of Russia,
the Baltic States, and Ukraine.

Following record 1995 meat imports totaling about 2 million tons (including
nearly 20 percent from other FSU countries), Russia looks set to import even
more in 1996.  Russia's extra-FSU imports of red meats during the first 7
months of 1996 ran nearly 10 percent ahead of January-July 1995, while poultry
meat imports were about a third greater.  U.S. sales of poultry meat (421,000
tons) to Russia for first-half 1996 were up 40 percent from first-half 1995,
but beef and pork exports (which account for less than 5 percent of total U.S.
meat exports to Russia) were down nearly 50 percent due to a decline in pork
sales.    Higher FSU grain output, fiscal austerity, and further downsizing of
the FSU livestock sector are expected to reduce 1996/97 (July/June) FSU grain
imports (intra- and extra-FSU) to less than 10 million tons, a near-record
low.  The bulk of FSU grain import needs are likely to be satisfied within the
region, as Ukraine and Kazakstan remain sizable wheat suppliers.

Printed copies of the Former USSR Update will be available in about a week. 
For further information contact Christian Foster (219-0625) or William Liefert
(219-0656).  Text of the full reports may also be accessed electronically. 
For details on electronic access, call (202) 219-0515.
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