TABLE 1
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In this paper, the privatisation system introduced into the Russian economy in 1992 is summarised. There follows a review of the performance of the Russian wool and wool processing industry in general, with the analysis then focussing on two major woolen mills located in Moscow. The relative performance of these mills in the context of a severely strained economy and of the privatisation legislation is examined and an attempt made to determine problems arisising from the privatisation process for the general process of Russian industrial recovery in the free market conditions currently prevailing.
I
THE PRIVATISATION PROGRAM
The Program for Deepening the Economic Reform in the Russian Federation, adopted by the Russian Parliament on July 17, 1992, set out, amongst a range of reform measures, the initial terms for the privatisation of state owned property. These terms of privatisation can be summarised as follows:
The Administrative Hierarchy
The process will be managed at federal and regional levels by a three armed decision-making structure involving:
All institutions are classified into five basic categories:
Privatisation can be initiated by any legal entity (including foreign entities) through petitioning of the appropriate property committee. Following a strictly timetabled approval process:
Prior to sale, an inventory and financial evaluation is to be carried out. The lack of Western accounting practice makes this difficult. The basic approach is book value adjusted for historical depreciation. Russians have never accounted for depreciation in the past. Rampant inflation severely complicates this process and, while there are clear rules to allow for this, there is confusion over their meaning for the ordinary enterprise accountants. As a consequence, the process has been extremely haphazard in implementation.
Four methods of sale are defined:
Essentially, those acceptable as buyers has been defined very broadly. Two crucial special rules are:
Where one third or more of employees opt to form a private company and can match any other bidder in the sale process, then their bid succeeds by default, and the employee company further has the privilege of paying off the bid over a three year period.
Employees are entitled to discount prices on a portion of the stock of the enterprise, with the discount at higher levels, the less the level of control retained by employees over the organisation. Three options are defined:
II
PRIVATISATION EXPERIENCE IN THE RUSSIAN WOOL PROCESSING
INDUSTRY
Against the background of this material, the relative performance of two Russian wool processing mils based in Moscow is reviewed. To provide an informed perspective on these mills, a review of the status of the wool industry in general is required.
The difficulties currently confronting the wool production and processing industries within Russia represent perhaps an archetypal example of industrial collapse under the economic and political transition process. Prior to 1992, these industries, although not uniformly operating at world standards of efficiency, had made continuing progress in many areas over the previous decade in raising performance in cooperation with western raw material, technology and trade partners. This progress was most evident in the post primary processing of clean wool product into textiles and garments. In some cases, technology in these activities is currently still capable of world best practice provided technical advisory assistance is forthcoming.
Yet the process of economic and political transition which emerged following the "Gorbachev Era" reforms of the late 1980's has taken its toll on the full value creation chain in the Russian wool industry. In places, the problem is one of technical decay, but in many cases, it is much more a lack of competence to manage the financial, administrative and marketing aspects of production that is impeding recovery in the industry.
DATA AVAILABILITY
As is the case across the broad spectrum of Russian economic activity, the availability of reliable statistical information is severely hampered in this industry by the budgetary constraints of government, and by the difficulties encountered in the adjustment of statistical practice away from that of former Soviet times towards modern scientific methods. A further suspected cause of inaccuracy lies in the localised efforts of various production units to avoid taxation obligations and/or to minimise asset acquisition costs in the privatisation process.
Sourcing for all data employed in this paper is detailed, and an effort has been made at finding a range of sources wherever possible. Whilst the specific values of particular statistical measures need to be treated with reservation in this light, the trend movements in many values are sufficiently pronounced to allow greater reliance on them as valid indicators. This judgement is reinforced by anecdotal field observations by various observers, both Russian and international, of conditions on the land and in wool processing facilities around the country.
THE STRUCTURE OF THE RUSSIAN WOOL PRODUCTION AND WOOL PROCESSING INDUSTRIES
At the simplest level, a lay description of wool production and processing centres on six basic activities:
Wool Growing
Wool Cleaning (Scouring)
Wool Untangling (Combing)
Cloth Weaving or Yarn Production
Final Product Manufacture
Product and Technology Research and Development
The accompanying diagram portrays these stages of the value creation process in flow chart form, expanding, where applicable, into the technical areas of each stage. Ideally, a comprehensive picture of the industry would provide data covering each area of production and processing. On the other hand, while the information presented in the accompanying tables is not in any way complete, it does give an insight into the difficult conditions affecting the industry in recent times.
The Farm Sector
Russian agriculture is characterised by a three tier structure of farming institutions. Historically, the sector was dominated by State farms, these being operated either as state operated collective farms or as locally based cooperatives. Alongside these massive institutions, the workers from the large farms were entitled to engage in agricultural production on very small (say 1/4 hectare) plots, which they did not own, but for which they had individual usage rights. In addition to the agricultural workforce, a large proportion of town and city dwellers had over time managed to acquire similar rights to small land holdings which were often endowed with a small holiday house or dacha.
The production quantities and particularly the efficiency of these small holdings often exceeded that of the large state farms. For instance, it is currently estimated that these small holdings are responsible for 60% of potato production for the nation. Generally speaking, production from such holdings is very haphazardly estimated. This adds a further complication to the statistical assessment of agricultural production in general, and wool in particular. At present, it is estimated that 1/3 of raw wool production comes from small holdings.
Wool Production (Table 1) - The major centres of wool production in Russia are Povodzhki Region, Kalmykiar Republic, Severo Kavkazki, Dagestan, Stavropol, Rostov, Bashkortostan, Zapalna, Vostochny and Tsitinskaya.
Raw (uncleaned) wool production in Russia in 1994 was only half that obtained in the 1980's. This decline reflects, in part, a reduction in the number of sheep (Tables 3 and 4) by a similar proportion over the same period. These figures are predominantly affected by the performance of the State farming system, where a dependence on former centralised production management has left production units in a state of confusion and mayhem. Reportedly, the disappearing numbers of sheep have found their way into local meat consumption, although there may be reason to suspect an under-reporting of numbers as part of a broader effort to avoid (evade) taxation liability.
For the main part, research and development programs such as the merino sheep breeding program in the southern krai of Stavropol have fallen away through lack of funding. In the urgency of the moment, all attention has turned to maximising either cash flow or food on the table, and some reports have emerged of breeding stock going into the general meat consumption/export sale process. Similarly, while there exist numerous wool testing laboratories in major centres throughout the wool production regions, these are readily admitted as being obsolete and of little value in the context of current marketing technology. This area of production technology has made rapid advances in the West in recent years and even some Western technology from the 1980's is becoming obsolete.
Early Stage Processing (Wool Scouring)
Washed (Scoured) Wool Production (Table 2) - The decline in scoured wool production in Russia in the early 1990's is even more marked than for raw wool. Anecdotal evidence suggests that the situation has deteriorated even more sharply in 1995. With the drying up of domestic washed wool supplies, advanced stage processors can only turn to foreign suppliers to maintain raw material flows.
In the preparation of this research, an effort was made to secure a data base covering the production enterprises involved in the various stages of wool processing. It appears, however, that information has come to be recognised as a scarce resource in the Russian context, and the prices quoted for the provision of such material were exorbitant. The data is known to exist in more or less collected form, and is believed to be held by a number of institutions. Continuing efforts will be made to extract it. In the meantime, information pertaining to, amongst others, the Stavropol Krai wool scouring plant provides an indication of existing conditions.
The organisation of manufacturing industry in the Former Soviet Union (FSU) was often characterised by a strategy aimed at maximising the dependence of individual regions on the greater nation as a whole. Hence, various stages of raw material, intermediate and final processing tended to be agglomerated on a geographical basis with little regard for transport or other location economies. Final processing might have been concentrated in, say, Siberia while raw material processing was perhaps concentrated in Ukraine, and the raw material source was in the far north. With wool scouring, a format appears to have been followed locating the plants within or in very close proximity to the wool producing regions. The Stavropol plant is thus located in the heart of a major wool producing region. The plant is apparently of reasonable efficiency by world standards, although it is known other plants elsewhere in Russia are definitely obsolete (eg Southern Krasnoyarsk).
The administration of the plant appears to be controlled by its individual management team, whereas the state farms in the region come under the control of the Stavropol Krai administration. This separation of control has engineered a parting of the ways for the respective decision makers involved.
In the aftermath of the collapse of the former USSR, the breakdown of the planning system resulted in the destruction of any forces operating for inter or intra industry cooperation. The history through the early 1990's of the cycles of credit crises, and the lack of invoicing and/or payment for materials or goods supplied as intermediate inputs has been well documented in the media and the academic and business literature. The wool processing industry did not escape these tumultuous developments. Having experienced two, perhaps three years of zero payments for wool supplied to the local and even to more distant scouring plants closer to Moscow, the Stavropol state farm managers and individual plot holders began at first to refuse supply as they stockpiled their output, and then to look elsewhere to market their raw wool. As a consequence, there developed a general glut of wool on offer to the most convenient market, China, with a consequent collapse of prices.
These developments led eventually to the closing of the Stavropol scouring mill and it has not now operated for some fifteen months. A major employer of local labour has been withdrawn from the local economy. The general confusion brought on by this train of events can be appreciated in the response of local officials to the suggestion of an Australian government backed management retraining program targeted at the scouring mill. This offer brought a mood of deep suspicion to the meeting where it was made, and a prompt ending to discussions. The relationships demonstrated in these developments and this state of confusion that they have engineered provide an insight into the difficulties that will be confronted in any economic revival projects targeted at the regional level in the agricultural and, for that matter, many other industries.
Later Stage Processing
Wool Textile Processing (Tables 6, 7 and 8) - The decline of production of washed wool is duplicated in downstream processing activities. For instance, reported employment in these areas of the industry has fallen 18%, severely questioning, by the way, the officially reported unemployment statistics for the Russian economy as a whole. In any event, many of these reported employees are likely to have been so only in name, as salary payments ceased for most some twelve months or more earlier.
Table 10 reveals the complete collapse of purchasing of foreign supplies of wool, further reinforcing the generally bleak picture of the industry.
Beyond wool scouring, the Russian wool processing industry fits more closely the normal geographical pattern of industry structure in the old USSR system, although not entirely so. There has been a tendency to concentrate production facilities away from the raw material source, but not exclusively so. Major processing capacity exists, for instance, around Volgograd in the wool growing region of the mid-south. It appears, though, that major centres are those based in the Moscow region and in Ilyanovsk.
As with enterprise data for the scouring stage, there is little readily available for later stage processing. This material is also still being pursued. The data that is available, largely from anecdotal sources, indicates a very similar predicament besets this sector of the industry. Caught up in the credit crises of the last few years, manufacturers have been starved of raw material supplies, and where production has occurred, there has been great difficulty experienced in the marketing process. As a consequence, producers are stripped of cash and purchasing power. There is very little in the way of importing of raw or washed wool.
On the other hand, the state of technology in this sector is, in many cases, of a very high standard, particularly amongst processors in the Moscow region, as is reported for the October Mill below. A number of these plants are capable of world's best practice in appropriately targeted markets. But despite the problems associated with the breakdown in domestic supplies of wool, this is not their greatest single problem. In the aftermath of the collapse of the FSU, the executive management of such institutions, whilst having the reins of power conferred on them by the privatisation process, have no basic idea what to do in order to manage production in a market system.
The domestic market for woollen garments, for instance, consisted of two very large general sectors, household consumption and the military. The latter market has almost completely evaporated in the context of budget constraints. The military has enough problems ensuring adequate food for its forces, let alone clothing. And it is being scaled down at a rapid rate. For households, similar problems of survival exist, only perhaps not entirely constricting. But where there does exist purchasing power to spare for clothing, the spending is being diverted to better packaged, better marketed foreign apparel. Beyond these market groups lie only foreign purchasers who, of course, are even more discerning. Management has no concept of even how to approach such problems. And the fear induced by ignorance and the need to preserve face inhibits their seeking out assistance.
Added to these marketing problems is the lack of any practical awareness of standard financial accounting procedure or of basic general management practice in an independent operating environment. Double entry accounting is only gradually entering the realm of Russian business practice, as are the fundamental principles of cost accounting. These enterprises, if operating, would be doing so in an accounting vacuum. For this reason, there is general scepticism at many of the technical components of the business planning process, an attitude brought on by simple ignorance.
Day to day production management in a technical sense should not present any extraordinary problems for the reforming industry. The ability of management and the workforce to effectively operate the physical production process is not questioned. On the other hand, the traditional role of the Soviet enterprise in the maintenance and funding of the national social welfare system is a major obstacle to be overcome. Requiring cooperation with local, regional and federal government authorities, and the trade unions, the restructuring of these responsibilities will take significant time and a great deal of ingenuity on the part of all involved.
In the context of the collapse of the wool and wool processing industry
in general, the experience of the October Mill and the Petra Alexeeva Mill
in Moscow demonstrates a radical variation in the potential of individual
enterprises to cope with these extreme conditions.
THE OCTOBER MILL
The Moscow textile manufacturing company "October" was formed in 1970 through the amalgamation of the "Kalinin" spinning mill (founded in 1883) and the "Kuntsevo" weaving factory (founded in 1890). The company was set-up as a unique industrial combine, the only one of its type in Russia and in the former USSR, for manufacturing the highest quality suit fabrics using yarn of top world standards.
Production Capacity
In the past, the "October" company used its full production capacity to supply woollen fabrics for the whole Soviet Union with a peak annual volume of 9.58 million metres in 1987.
With the disintegration of the USSR and difficulties experienced through the transition to a market economy, the company reduced its total production to 1.16 million metres of woollen fabrics in 1995 (12% of 1987).
Workforce
Due to the continuous decrease in production output, the company reduced the total number of its employees from 2,886 people in 1991 to 1,602 in 1995.
The break down for the labour force of the company for the corresponding
years is as follows:
Years 1991 1995
Process workers 2,496 1,363
Technical personnel 211 137
Administration 179 112
Year 1991 1992 1993 1994 1995 1996*
Yarn
(1000 t) 3,302 2,966 2,724 1,342 432 967
Rough fabric
(1000 m) 7,406 6,761 6,034 2,757 1,250 2,080
Pure woollen fabric
(1000 m) 6,924 6,489 5,884 2,653 1,165 2,000
* Estimates
Ownership
In July 1993, the "October" company was privatised as part of the privatisation program in Russia for state owned enterprises. It became a joint stock company with the following shareholder ownership as at February 1996:
The Managerial Structure
The existing managerial structure of the company comprises six units: marketing and sales, accounting and finance, economic planning and industrial relations, social infrastructure, logistics and technology.
Value Chain Description
The value chain for the "October" company commences at the top making stage, with scoured wool processed into tops before yarn spinning and dyeing. The yarns then pass through the weaving stage of the worsted process. 95% of yarn is sourced internally from the company's Kalinin plant. From weaving the chain of activities includes carbonisation, dyeing, pre-shrinking, drying, trimming steam ironing, packing and marking. The following table indicates the cost break-up of the major woollen fabric processes.
The table highlights the significant competitive advantages of the Russian
wool processing industry. It is estimated in Australia that the manufacturing
processes add 10.7 times the value of a kilogram of wool, while at the
"October" company this factor is only 3.8 times. These figures should be
treated with some reservation but they do illustrate the competitive nature
of the Russian wool processing industry.
Estimate of Australian October Mill
Wool Processors Council
Greasy wool to scoured wool 1.14 1.10
Greasy wool to top 1.60 1.44
Greasy wool to white yarn 2.90 2.00
Greasy wool to dyed yarn 3.80 2.20
Greasy wool to wool fabric 10.70 3.80
Greasy wool to wool garments 39.40 18.60
(Wholesale)
Greasy wool to wool garments 78.90 30.50
(Retail)
The information in Table 3 shows the sales performance and in Table 1 the production output of the "October" company from 1991 to 1995. The slowing of output through 1992 and 1993 pales in comparison with the dramatic drop in 1994 and 1995. Present forecasts for 1996 are for an increase in sales. This data confirms the difficulties experienced by the 'October' company.
An analysis of the value chain and the resultant linking of resources identifies that the production process is the key driver of the business and is where the greatest value is added. The "October" company has for many years been identified as a producer of the highest quality woollen fabrics, a reputation confirmed in the company's use of the
Table 3: Sales Performance
1991 1992 1993 1994 1995
Sales 196,020 181,650 178,110 81,990 38,100
(1991 Prices
in R millions)
"Woolmark" logo. Further strengths are identified in the areas of skilled personnel and a supportive morale amongst staff presently working.
Recently the procurement of quality wool is proving difficult in Russia as more sheep are being used for sheep meat and consequently the quality of their wool is dropping. High quality wool is available but at a price which the 'October" company perceives as too high. In effect, they cannot pass on the higher quality wool to consumers who have sustained a loss of purchasing power in the transition process.
The major weaknesses identified by the value chain analysis were in
the areas of marketing and management experience in a market system. An
important challenge for the "October" company is to recognise these weaknesses
and attempt to solve them. The incorporation of representatives of the
garments manufacturing, retail and fashion industries enhances planning
for the product range, but other aspects of marketing are deficient. Suggested
strategy variations are outlined in the marketing plan.
THE PETRA ALEXEEVA MILL
Organisation History
The organisation dates back 160 years as a major textile manufacturing operation, concentrating in more recent times on the manufacture of "second ranking" fine woollen cloth for women's clothing. It is the only producer of such cloth in Russia.
Production Capacity
The production capacity of the mill stands at 2.5 million metres of fabric per annum. In 1992 and 1993 production fell by some 30% per annum, reflecting raw material supply difficulties and lack of purchasing capacity among traditional buyers. By 1995, production had climbed back to 1.6 million metres of cloth, and in early 1996, the mill was operating at 80% of capacity.
Workforce
The company employs 1,057 people, of which approximately 850 are involved in actual production, 140 in maintenance and the balance in social welfare. A system of piecework payment was introduced in 1995.
Ownership
The company was privatised in 1993, becoming a joint stock company with the following ownership structure:
The Managerial Structure
The managerial structure of the company comprises four units, production, economic management and planning, finance and commercial (including marketing).
Value Chain Description
The value chain of the Petra Alexeeva Mill is virtually identical to that of the October Mill, except that the entire plant is located on the one site. Production at Petra Alexeeva is also efficiently managed and staff morale appears high. Product quality is at a high level, allowing for the Mill's dependence on Russian wool producers for 90% of raw product, a low quality commodity.
The key variation between the mills lies in the their relative performance in the open market conditions now prevailing. The Petra Alexeeva management appear to have a very strong command of the market and the Mill is clearly returning to peak production and sales levels. Partly this reflects the cost structure of the Mill, with piece work wages claimed as a clear advantage.
Mill management also, however, have engineered a very strong position in both raw material and product markets. The company buys in all raw material on sixty days deferred payment, and only contracts to supply product against 100% prepayment. This position appears to have been achieved through modification of the finished product in line with product samples from overseas, thus keeping in line with emerging Russian consumer fashion preferences.
This capacity of the Petra Alexeeva management to cope with market conditions reflects the 6 month business management training program undertaken by the managing director in 1994 with the TACIS program administered and funded by the European Union.
In both cases, mill management were reluctant to discuss the precise details of their privatisation experiences. However, from general comments made, from the ownership structures that have emerged, and from knowledge of the relevant legislation outlined earlier, it would appear that the following observations are reasonable:
At the time of privatisation, the October Mill had only recently acquired a "state of the art" new production line of European design and manufacture. As a consequence, under the provisions of the enterprise evaluation rules, the capital value of the major component of enterprise assets would have, at book value, been close to world market prices. In the context of what were already highly deflated salary levels, together with an extremely underdeveloped financial sector, it is difficult to imagine the employees of the Mill contemplating with any degree of serious intention an outright takeover of the mill under the rules of Employee Participation Option 2 outlined above.
In contrast, this is the outcome that transpired at the Petra Alexeeva Mill at the time of its privatisation. The average age of the mill's equipment was quoted as 20 years, putting the book value in absurd terms under the severe inflationary conditions prevailing. It is likely that some attempt would have been made to account for this, although the primitive state of standard Russian accounting knowledge would have left a significant "discretionary" gap in any negotiations between the employees' group and the relevant branch of the State Property Committee. Such negotiations would have been likely under the provision for an enterprise of such magnitude to be offered for sale on a conditional tender basis as explained above. In any event, the employees' group was entirely successful in acquiring the mill, with 100% ownership.
It has not been possible, at this stage, to establish the exact provision for inflation allowed under a contracted buy-out by an employees' group with a three year "time payment" arrangement. This area of the legislation, apparently of direct relevance to the Petra Alexeeva privatisation, may also have allowed a discretionary outcome to the ultimate cost to the employee group of purchasing the plant.
In contrast, with the employees of the October mill practically excluded from outright control of the privatised enterprise (Option 2 above), and the mill being a Category 4 enterprise by virtue of its enormous size, any employee participation would be confined to the arrangements allowed under Option 1. In essence, while the employees were attributed with 48% ownership of the mill, this would include 25% preference shares without voting rights.
The concern "Rostextil", quoted as a 28% shareholder in the October Mill, formerly acted as the coordinating authority for the entire textile industry of the USSR. It has now been privatised itself, and hence is a non-government shareholder. Rostextil actually financed the new machinery acquired by the Mill in 1992 and had an obvious interest in acquiring an equity in these assets. On the other hand, the Moscow City Government, according to the legislation, would be barred from owning shares in a privatised enterprise because it is a government entity.
However, the legislation provides for the role of a "Golden Share" to be retained by appropriate government agencies if there is a clear significance of the health of the enterprise for the broader community. Such an equity must, under the 1992 (and the subsequent 1994) legislation, be disposed of after three years. From discussions with both senior and middle management at the October Mill, it was clear the role of the Moscow City Government as an equity holder was contingent on the government's performance in assuming the social welfare responsibilities of the Mill towards its "workforce" (this term includes former employees). It would appear some scope has been found under the legislation for the Moscow City Government to endure as an equity holder.
This role of the City in the control of the Mill has proven a fundamental catalyst to the development of the crisis conditions outlined above. As either a silent or reinforcing partner to Rostextil, the City has reinforced the status quo approach of management to the emerging drastic changes in the industry brought about by the onset of the free market. There has been no change in senior management, thus perpetuating a management style used to working in an operating environment heavily flavoured with political and bureaucratic patronage. This has prevailed during a period when such patronage has become totally redundant in any sense of financial or resource procurement. Government at all levels has no money for industry support.
The inertia imposed on the organisation under the existing executive
contrasted deeply with the frustration expressed by the younger middle
management group. These individuals talked freely of opportunities aspired
to in the free market and had formed quite reasonable strategies to be
implemented once the opportunity arose. These included the break up of
the enterprise into separate legal entities, adoption of management information
accounting, leasing of surplus factory space and the niching of output
to the newly emerging Russian middle class.
IV
CONCLUSION
There could be no guarantee that any newly liberated Russian enterprise managed by market oriented, though inexperienced individuals could succeed in what is possibly one of the toughest economies at present in the world. However, the contrasting privatisation outcomes for the October and the Petra Alexeeva Mills clearly indicate that, without the transfer of decision-making power to individuals willing to attempt a mastering of the free market, the simple shift in equity ownership from government to private organisations is pointless.
The Russian privatisation legislation, particularly in its earlier 1992 format, has been successful for some enterprises, but obviously disastrous for others. With enterprises such as the October Mill that possess assets of clear value in a market context, though of little value under current management, there has been an extremely heavy burden born by the workforce, their dependents, the shareholders and ultimately the broader community. This burden has been concentrated into a relatively short period of time, and has contributed to the wide disruption that still plagues the nations' economy.
Yet the assets involved have not gone away. They stand, largely unused
in factories occupying what has become expensive real estate. These assets
ultimately will be sold, possibly in some cases in foreign markets. It
is to be hoped that the latter is an exceptional event rather than the
norm, but that will depend on the conditions that prevail in Russia for
foreign investors to take up on the opportunities that lie dormant at present.
APPENDIX
TABLE 1
AVERAGE ANNUAL WOOL PRODUCTION IN THE RUSSIAN FEDERATION
(FARMING OF ALL ORGANISATIONAL FORMS)
(THOUSAND TONNE)
1971-75 1976-80 1981-85 1986-90 1991-93 1991 1992 1993 1994
218.7 221.6 221 225.3 180.5 204.5 178.6 158.4 124.1
State Farms: 173 181 177 177 122 146 120 99
"SOURCE: The Yearbook of Statistics of the Russian Federation (1994) Mosocow: Goskomstat, Pp 360-361"
TABLE 2
PRODUCTION OF WASHED WOOL IN THE REGIONS OF THE RUSSIAN FEDERATION
(THOUSANDS OF TONNES)
1990 1991 1992 1993 1994
111 89 65.5 49.5 38.6
"SOURCE: Economic Figures on the Development of the Agro-Industrial Complex of
the Russian Federation in 1994, Part II, Moscow: Minselhozprom, P 47"
1993 1994
61.2 52.9
SOURCE: International Wool Secretariat
TABLE 3
NUMBER OF SHEEP - STATE FARMS IN THE RUSSIAN FEDERATION
1970 1975 1980 1985 1990 1991 1992 1993 1994
46.1 49.1 48.4 47.1 41 35.5 31.6 20..3
"SOURCE: The Yearbook of Statistics of the Russian Federation (1994) Mosocow: Goskomstat, Pp 343-344"
TABLE 4
NUMBER OF SHEEP AND GOATS IN THE RUSSIAN FEDERATION
(FARMING OF ALL ORGANISATIONAL FORMS)
(THOUSANDS OF HEAD AT YEAR END)
1991 1992 1993 1994
55,255 51,369 43,713 35,948
* The proportion of goats in the total is minor.
"SOURCE: Economic Figures on the Development of the Agro-Industrial Complex of the Russian Federation in 1994, Part II, Moscow: Minselhozprom, P 18-19"
TABLE 5
AVERAGE ANNUAL AMOUNT OF WOOL SHORN FROM A SHEEP - RUSSIAN FEDERATION
1970 1975 1980 1985 1990 1991 1992 1993
3.4 3.4 3.3 "3,5" 3.9 3.7 3.4 3.3
"SOURCE: The Yearbook of Statistics of the Russian Federation (1994) Mosocow: Goskomstat, Pp 366"
TABLE 6
PRODUCTION OF WOOL FABRICS IN THE RUSSIAN FEDERATION
(MILLIONS OF SQUARE METRES)
1980 1985 1988 1989 1990 1991 Jan-Apr 1994 Jan-Apr 1995
517 433 461 471 466 386 38.4 28.9
"SOURCE: Wool Processing Enterprise, ""Mosherst"", Moscow, 1995 and International Wool Secretariat"
TABLE 7
WOOL TEXTILE PROCESSING - EXCLUDING PRIMARY PROCESSING (SCOURING ACTIVITY)
Number Employed* Average Income
"(,000)" (Thousand Rb per Month)
1995 99 250.8
1994 121.7 113.1
* Women comprise 70% of the workforce - Source: Rostextil Enterprise
SOURCE: Goskomstat
TABLE 8
WOOL TEXTILE PROCESSING IN THE RUSSIAN FEDERATION
1993 1994
Tonnes
Single Woolen Yarn 116,883 591
Worsted Single Woolen Yarn 50,762 22,029
Twisted Woolen Yarn 44,468 18,634
Thousand Running Metres
Unbleached Woolen Fabrics 145,181 0
Finished Woolen Fabrics 143,982 63,617
Pure Wool Fine Cloth 14,209 9,568
SOURCE: International Wool Secretariat
TABLE 9
EXPORTS OF WOOL FROM THE RUSSIAN FEDERATION IN 1994 (TONNES)
All Wool Scoured Wool
Quantity Value (US$000) Quantity Value (US$000)
Total 24,918 25,927 3,937 6,518
Belgium 3,962 3,180
Bulgaria 2,642 2,247 572 928
China 5,313 6,309 402 983
Germany 2,264 1,820 129 171
Hungary 1,640 1,964
Italy 2,136 3,020 695 1,171
Poland 1,069 947
Turkey 1,067 588
Great Britain 1,257 1,373
SOURCE: International Wool Secretariat
TABLE 10
ANNUAL VOLUME OF WOOL IMPORTS TO THE FORMER SOVIET UNION
(THOUSAND TONNES GREASY EQUIVALENT)
1987 1988 1989 1990 1991 1992 1994 (RUSSIA)
641.9 823.3 940.2 419 ~420 ~70 ~1.8
SOURCE: US Department of Agriculture and "World Bank, The Strategy of Reforms in the Food and Agricultural
Sector of the Former USSR, 1993, P 215" and International
Wool Secretariat
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