6/25/2004 INTERFAX - Investment in Russia's fats and oils complex comesto $250 million annually, deputy chief of the Agriculture Ministry'sfederal agriculture agency Vladimir Kaishev has announced.

Speaking at the 3rd international conference 'Russia's Fats and OilsComplex: New Aspects of Development' in Moscow, Kaishev said the sectorhas experienced a serious technical breakthrough allowing forsignificantly increasing oil-bearing crop harvests and the production ofvegetable oils.

Sunflower planting has over the past ten years expanded by more than 30%,reaching 6.3 million hectares in 2003. Russia harvest its biggestoil-bearing seed crop since 1990 last year of 5.6 million tonnes(including 4.9 million tonnes of sunflower), against an average 3.9million tonnes for 1999-2002.

"This lays a good base for turning out around 1.6 million tonnes ofvegetable oil this year," Kaishev said. Russia produced 1.5 million tonnesof the oil last year.

On the other hand, Kaishev said, such worthy crops as soy and rapeseedhave yet to claim their place in the sector. "Where in 1990 soy covered740,000 hectares, past years saw planted lands stabilize at430,000-450,000 hectares, the gross harvest 350,000-400,000 tonnes," hesaid, noting that the United States produces up to 70 million tonnes ofsoy a year.

Kaishev said addressing this problem would be much aided by theimplementation of an Agriculture Ministry for increasing soy production inthe period until 2010. It envisions measures that would allow forincreasing the gross soy crop in the country to 700,000 tonnes by 2010.

The production of rapeseed in Russia could in the next few years be takento 1 million tonnes per year. Russia harvested only around 200,000 tonnesof it in 2003.

"Thus, the real raw material base in the oil and fats sector could in thenext few years be 5 million tonnes of sunflower seed, 700,000 tonnes ofsoybean and around 1 million tonnes of rapeseed," Kaishev said. "It cannotbe ruled out that the production of Russia's traditional oil-bearing cropslike mustard, flax, hemp and castor could be increased to 200,000 peryear." This material base will alow for increasing oil production inRussia to 2.1-2.5 million tonnes annually.

Russia's oil and fats complex comprises over one thousand agriculturalenterprises and 3,000 farms, upwards of one hundred large and mid-sizedand 2,000 small and very small enterprises. The complex sells productworth more than $5 billion every year.