IKAR in Mass Media

Impact of bad weather on harvest drags down Russia's GDP in August

02 октября 2024 года

MOSCOW, Oct 2 (Reuters) - Extreme weather that pushed Russian farmers into the fields early this year to salvage their crops took a toll on the country's gross domestic product in August, economy ministry data showed on Wednesday.

The ministry said agriculture sector output was down 14.7% year-on-year in August, while for the first eight months of 2024 the volume of agricultural production output contracted by 3.2% year-on-year.

This year's Russian harvest has been hit by bad weather, ranging from early spring frosts to drought and heavy rains. All of Russia's top grain-producing regions have cut their harvest outlooks.

"Agricultural production output in August was 14.7% lower year-on-year, primarily due to the shift of the grain and leguminous crops harvest to a later date," the ministry said in an explanatory note for the data.

Russia's agricultural output often contracts in August when the harvesting campaign nears its end in many regions, but this year's decline was exceptional and more than double last year's contraction.

The economy ministry said gross domestic product grew 2.4% year-on-year in August, down from a 3.5% annual increase in the previous month. The ministry said the fall in agricultural production affected the headline GDP figure.

"The main reason is the delay in the agricultural harvesting campaign," the ministry said.

Agriculture, which was mostly unaffected by Western sanctions, has been one of Russia's main GDP growth drivers in recent years. The country, already the world's top wheat exporter, aspires to become a global agriculture superpower.

Russia still officially forecasts this year's grain harvest at 132 million metric tons, but many analysts have been revising their harvest forecasts downward. IKAR consultancy sees this year's harvest at 124.5 million tons.

Russia's statistical agency said on Wednesday that as of Sept. 1, Russian farmers had harvested 85.2 million tons of grain in initial weight, 14.7% less than last year.

Apart from agriculture, no other sector of the economy showed a decrease. Industrial output was up 2.7% with manufacturing 4.7% higher in August, while mineral extraction was flat. Russia expects GDP growth of 3.9% this year.

Source: Reuters | #grain | Comments: 0 Views: 6

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