World’s Largest Cattle Operation is in Russia
Vice news recently reported on the worlds largest cattle operation. And it’s in Russia.
A round of Western sanctions on the Russian economy designed to impede the economy appear to have backfired when it comes to domestic agriculture. The article, which can be found here, suggests the uptick in agricultural activity is the result of irony as US company Miratorg has increased its presence in the country.
The US firms expertise in meat production has led it to purchase around 2 million acres of arable land and has increased the number of staff four-fold since 2010. It now employs 35,000 people.
Having secured generous state-backed loans, Miratorg has been importing everything from Aberdeen Angus cows, herding horses and even grass for the growing number of cattle to graze on.
The 1,000 +member team of homegrown Russian cowboys were initially trained by Americans, and are now overseeing a super-herd of almost 400,000 mother cows — making it one of the largest cattle operations in the world.
Ranch boss. Kansan Phil George, with over 25 years experience, has been hired to oversee the rapid expansion.
“When I first saw the land, all you could see was a landscape covered in a meter of snow. But we did things very, very quickly,” he said. “There was no infrastructure and no resources in Russia other than land and inexperienced people. We imported cattle, we imported 500 horses from the U.S, we bought saddles for every one of them, we imported semen, pharmaceuticals…even the first crails had to be imported and weren’t constructed here.” Mr George is quoted as saying.
The rapid expansion is a result of Putin’s desire for the country to become self-sufficient for food in the next five years, and to grow food exports to China and the Gulf. This is part of a plan to help reduce the Russian economy’s dependence on oil and gas activity, diversifying the economy and forging greater ties with the east. This follows a deterioration of relations between Russia and the west in recent years.
Russia’s recent pivot into agriculture predates the U.S. and EU sanctions that followed Russia’s invasion of Ukraine, but their imposition turbo-charged the growth of a previously dormant industry. In a counter move sanctions placed on the West by Russia in 2014 banned the import of food, rendering more than half of the country’s meat, dairy and fish imports illegal. As a result, the Russian state-backed domestic producers of cheese, meat, fish, vegetables, and wheat. Firms, such as Miratorg, increased production several times over in just a couple of years. Almost $4 billion worth of Russian agriculture products has been produced as a result of sanctions, according to the Russian government.
While production in the agriculture sector has benefited from the sanctions, this has come at a cost to the wider Russian economy and Russian citizens.
“Yes, of course, output has increased. However, it all comes at a cost to Russian households,” economist Natalia Volchkova told VICE News. “Russia’s counter-sanctions shield these businesses from world competition. They can’t compete with real-world prices.”
However, even in the unlikely event of a reversal in Russian-Western relations, Volchkova says Russia’s burgeoning cowboys might not be the first to succumb to market forces.
“Miratorg, now that’s a good question,” she said. “If they are actually using international practices, they might ultimately manage to be competitive in normal conditions.”
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Danny Deegan is the Editor and proprietor of eurasianmarket.com. Born in the UK, currently working in financial services with an emphasis on equity investments and forex trading.