Rusagro, one of Russia’s largest agribusinesses, is making a significant move to expand rice production in the Primorye region. Recently, the company signed an agreement with the Primorye government and the Corporation for Far East and Arctic Development (KRDV) at the Eastern Economic Forum to invest a staggering 22.8 billion rubles ($233 million USD) in the region’s rice irrigation infrastructure. This project aims to increase the annual rice yield in Primorye to 150,000 tons—over five times the region’s 2022 yield of 23,000 tons.
The Scope of the Project
Currently, Rusagro is working to select the most suitable land in Primorye to launch this initiative. Within the next five to seven years, the company plans to double the rice cultivation area from 16,000 hectares to 32,000 hectares. According to Alexander Tarasov, Deputy General Director for Corporate Development at Rusagro, this project has the potential to restore and elevate the rice industry in Primorye, which has faced challenges in production efficiency and resource management in recent years.
Why Primorye?
Primorye offers a strategic location for expanding rice production due to its access to vital irrigation resources and its proximity to export markets in East Asia. Although rice farming in Russia is largely concentrated in regions like Kuban, Primorye has unique potential to help the nation diversify its sources and increase overall production.
The regional government and KRDV view Rusagro’s project as a critical step toward revitalizing local agriculture, enhancing food security, and creating jobs. The planned infrastructure improvements will involve extensive updates to existing irrigation systems to ensure water supply reliability, a key factor in achieving high yields.
The National Perspective: Growing Demand for Russian Rice
Primorye’s 2022 rice harvest of 23,000 tons already supplied enough for local needs, with some surplus shipped to major cities like Moscow and Saint Petersburg. In 2023, production rose by 13% to 26,000 tons, a testament to the region’s capacity for growth. Nationwide, Russia produced 1.07 million tons of rice in 2023, a 24% increase year-over-year. Deputy Minister of Agriculture Andrey Razin has stated that national production could potentially reach 2 million tons in the coming years, with expansions in areas like Primorye playing a key role.
Rusagro’s Broader Role in Russian Agriculture
As one of Russia’s top agribusinesses, Rusagro’s influence extends well beyond rice. The company is a major producer of sugar, meat, and oil and fat products under popular brands like “Russian Sugar” and “Warm Traditions.” Its diverse portfolio of agricultural operations spans 689,000 hectares, positioning it as the fourth-largest landholder in Russia’s agricultural sector. The company’s revenues for the first half of 2024 surged by 30% year-over-year to 142.7 billion rubles, reflecting strong performance across its various markets despite a 74% decrease in net profit to 3.48 billion rubles.
Rusagro’s investment in Primorye’s rice sector represents a transformative opportunity for both the region and Russian agriculture as a whole. By developing advanced irrigation systems and expanding rice fields, Rusagro is laying the groundwork for a substantial increase in domestic rice production. As the company moves forward with this ambitious project, it is poised to strengthen Russia’s food security and bolster its agricultural output in a sustainable way.
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