Investment in Agriculture and the Virgin Land Scheme

• • Corn Campaign encouraged growing of corn.
  • Virgin Lands scheme aimed to cultivate unused lands for farming.
  • Increased investment led to initial agricultural successes.
• • Between 1952-56, there was a 250% rise in farm incomes.
  • By 1955, there was a 30% increase in tractors.
  • By 1959, agricultural investment reached 12%.
  • Due to Virgin Land Scheme, agricultural production increased 15% by 1964.
• Improved incentives in agriculture under Khrushchev

  • In 1954, Khrushchev changed the relationship between the collective farms and the government in order to create incentive for higher production rates.
  • Wanted to invest in farming by offering farmers pries for their produce.
  • Under Stalin, each farm had to produce a quota of goods, which was bought off the government for a very low price.
  • Khrushchev reduced the quotas and introduced higher prices for everything that was produced in addition to the quota.
  • Led to a 250% rise in farm incomes between 1952-1956.
• Investment in agricultural resources under Khrushchev

  • Khrushchev also invested in farm equipment and fertilisers.
  • In 1954, Khrushchev announced the construction of new fertiliser factories and an increase in the production of tractors.
  • By 1955, this resulted in a 30% increase in the number of tractors available and a 40% increase in fertilisers created.
• Virgin Lands Scheme

  • Khrushchev’s most ambitious agricultural policy.
  • Hoped to increase Soviet agricultural production by turning un farmed lands in the Northern Caucasus, Kazakhstan, and Western Siberia into new farms.
  • Launched in September 1953, it required significant investment, so agricultural investment grew from under 3% a year to 12.8% oft he Soviet budget between 1954-1959.
• Corn Campaign

  • From 1958; Khrushchev encouraged Ukrainian farmers to grow maize; maize would be used as animal feed to increase meat consumption for citizens; wheat would be shifted to new Virgin Lands.
  • Corn campaign was a failure.
  • Soviet farms were only able to produce 50% of the corn per hectare that the US farms managed due to worse climate and productivity, and the inferiority of Soviet machinery and fertiliser.
  • The opportunity cost of producing more corn meant that Soviet farms produced less hay.
  • As a result, the amount of animal feed produced by Soviet farms, reduced by 30%
• Agricultural success under Khrushchev

  • Initially, the Virgin Land Scheme was very successful.
  • VLS led to a greater availability of food in Soviet shops.
  • Better living standards
  • 400% increase in income of farm workers.
  • Success of VLS allowed Khrushchev to consolidate his position and led him to take on even more ambitious schemes.
  • In 1956, Khrushchev introduced commitment to produce more food than the US by 1960. required a 300% increase in production in four years.
  • Grain harvests, meat and milk production all rose significantly between 1953-1958.
  • Overall, agriculture rose by 35.3%
• Agricultural failures under Khrushchev

  • Even during successful periods of 1954-1958, Soviet agriculture remained very inefficient.
  • After initial success, the Virgin Lands Scheme failed to lead to further growth.
  • Harvests began declining below 1958 levels,
  • Between 1960-1964, production slowly increased, so that overall agricultural production was around 15% higher in 1964 than in 1958.
  • Virgin Lands Scheme very expensive.
  • During the 1950’s and 1960’s, between 54% and 44% of the Soviet population worked on farms versus just 5% in the USA however the USA produced double the food.