The horticulture sector of the former Soviet Union

The breakup of the USSR at the end of 1991 and the subsequent implementation of market reforms have had a profound effect on production, consumption, and trade of horticultural products (namely potatoes, vegetables, fruits, berries, and grapes) in the 15 independent countries of the former Soviet Union (FSU). Market reforms in most of these countries have been characterized to varying degrees by price liberalization, privatization, fiscal and monetary reforms, and reduced state control of marketing and trade. Since 1992, horticultural production has become concentrated in private plots and gardens, and marketing of these commodities is increasingly taking place outside of state channels. Production of most horticultural products has decreased, except of potatoes, as yields have fallen primarily due to adverse weather. Lower vegetable yields may also reflect a change in the production mix to those products for which demand is highest. Although reduced purchasing power due to price liberalization led to lower per capita consumption of livestock products, consumption of most horticultural products has remained stable, or in the case of potatoes, increased. The breakdown of the centralized trade system has lowered inter-republic (that is, trade between the 15 FSU countries) horticulture trade, although official trade data most likely overstate this drop. Since 1994, Russia, the primary food importer in the region, has increased imports of many horticultural products, especially fruits. Changes in consumer preferences, trade liberalization, and a real appreciation of the ruble against the U.S. dollar since 1993 are the main factors driving this increase. At the same time, Russia has also introduced import tariffs on these products, ranging from 5-30 percent of the customs value.