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19 May, 2008 06:28

Investment in arable farming reaps rewards

While the world grapples with food shortages and rising prices, Russia’s grain harvest is growing. Agriculture Minister Alexey Gordeyev expects a total 85 million tonnes, while the Grain Union says it could be even higher.

Descended from a noble Russian family of statesmen, diplomats and soldiers, Michel Orlov was born in Switzerland. He returned to the country of his forefathers after the collapse of the Soviet Union, making a living first as a financier, then as a farmer.

Russia’s once thriving agricultural industry was at the time a basket case, but three years of hard work have yielded results.

Now the company controls about 300,000 hectares of land across Russia's six southern regions – an area about the size of Luxembourg. Keeping track of it all is not easy.

Satellite navigation, parallel driving systems and electronic maps of fields all have a place in his agricultural business.

Michel Orlov brought the world's best technological expertise to Russia’s fertile black earth and using it can significantly reduce expenses. Although he has achieved much, Orlov says he faces even greater challenges ahead, with agriculture only just starting to revive.

But Michel Orlov is optimistic about the outlook for Russian agriculture. He compares it with the oil industry.

“I remember when the oil companies were privatised. The oil price in Russia was $US 8 per barrel. It was not very attractive and all these oil companies were totally mismanaged, with enormous debt to be restructured. That was tough and we made it!” he said.

World demand for food is growing and the future might see a shift from hydrocarbons to proteins for energy. Russia’s farmers once again have the chance to take a leading role in the country.