Keywords

1 Introduction

Legislatively and essentially, modern Russian P(F)Es belong to a set of business structures marked with independence in making economic decisions and the desire to realize the entrepreneurial spirit of their owners aiming to obtain higher income from their activities over many years. The features of this farming form presuppose the ability of its business executive to correlate the viability of chosen branches, the innovative elements, the territorial and bioclimatic conditions of the location of the P(F)E, the situation on local, regional, and global markets, as well as other factors affecting the achievement of the goal in correct proportions [10].

During the formation of peasant (farm) enterprises in Russia (the beginning of the 1990s), their organization had a spontaneous nature. They were established without any serious studies of future activities and did not factor in the availability of labor and financial resources [8]. Creating equal economic conditions for various forms of ownership in agriculture has increased the access of farmers to land as the primary means of production [6, 7]. However, their allocation was carried out by agricultural organizations, which, as a rule, allocated the worst land in terms of fertility (idle or inarable land) to P(F)Es. This land was usually located far from all available means of communication. A questionnaire survey of farmers who organized their farms before 1998 showed that 38.2% of owners of peasant (farmer) enterprises rated their “first” land as the worst, while 61.8% described it as average. Not a single participant in the survey rated their land as the best.

Within the transition to market relations, the structure of production was determined by economic entities (including farmers) exclusively factoring in the market conditions of products and the effectiveness of their sales. For example, in farms located in the raw material zones of processing enterprises, a significant share in the structure of crops was occupied by industrial crops, the processing of which on tolling terms made it possible to obtain guaranteed sales markets.

It is possible to assess the justification of this one-factor approach to the organization of economic activities using a system of performance indicators. The concept of efficiency implies the ratio of the result to the cost of funds or resources spent on its achievement, while the dynamics of the values of these indicators will reveal the degree of improvement or deterioration of resources [9].

Currently, the country changed the economic conditions, meaning, and functions, as well as the internal structure and quality of the farming sector. The efficiency of economic activities of P(F)E requires an assessment and search for solutions to an immense set of problems. These problems arise in connection with the internal reform of the AIC and the global interests of the state to ensure food security through import substitution mechanisms.

The study analyzes the efficiency of farm production branches to identify on-farm reserves to increase the overall efficiency of the financial and economic activities of P(F)Es.

2 Materials and Methods

The research applies unified methodological schemes, methods, and standards developed for agricultural producers. The paper indicates (where possible) the main features of peasant (farm) enterprises, a wide variety of their standard sizes, and the specifics of the agricultural production conditions by region.

The paper applies methods of economic and statistical evaluation of the time series of dynamics for 5–20 years for particular performance indicators. The authors conducted questionnaire surveys of farmers and delegates of AKKOR to identify the attitude of P(F)E owners regarding various stages of development of their business [1]. The paper is based on the selective use of literary and analytical generalization, expert evaluation, monographic experience, etc.

During this research, we used such information resources as scientific and reference literature, data of the Russian Federal State Statistics Service (including the results of the All-Russian Agricultural Census 2006 and 2016), regional consolidated annual accounting reports of P(F)Es and their cooperatives, monographic research of the scholars. The extensive scientific and analytical material collected during the study allowed us to conduct a qualitative and objective analysis of the effectiveness of agricultural branches in peasant (farm) enterprises.

3 Results

In Russia, peasant (farm) enterprises specialize in crop production, as evidenced by the sectoral structure of agricultural production (Table 1). Moreover, the share of livestock production varies from 43.3% in 1998 (the maximum value for the study period) to 20.3% in 2018 (the minimum value), never exceeding the 50% threshold.

Table 1 Sectoral structure of agricultural production in the P(F)Es of the Russian Federation, %
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The concealed nature of collecting and processing statistical information on the financial and economic activities of peasant (farm) enterprises in Russia makes it impossible to conduct adequate monitoring of the development of the entirety of P(F)Es within the country. A change in the overall situation would increase the ability of management bodies and scientific institutions to develop more informed decisions on determining the levers and directions for improving the efficiency of farm production. We selected one of the Russian regions marked with basic indicator values of the farm sector development, close to the national average. For example, the share of crop production obtained by farmers of the Tula Region in 2018 amounted to 88.1%, while their share of livestock production amounted to 11.9%.

A more detailed analysis of the specialization indicators of studied region showed that P(F)Es prefer growing grain and potatoes, which accounted for 57.9% and 20.1%, respectively, in the structure of sales revenue for 2018 (Table 2).

Table 2 Volumes and structure of production of main agricultural products within the P(F)Es of the Tula region (2011, 2014 in comparable prices, 2017, 2018 in actual prices)
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The methodology for evaluating the production efficiency is based on the natural values of the gross production of a specific product correlated to the primary production source of its manufacture. The de facto harvested sown areas act as the primary source of crop production, while livestock fulfills this role in animal husbandry. The analysis of crop yields and animal productivity showed consistent growth, except the average daily increase in the live weight of cattle (Table 3).

Table 3 Crop yield and animal productivity of P(F)Es of the Tula region
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Primary production resources include land, labor, and fixed assets. The land-use efficiency in peasant (farm) enterprises of the Tula Region is generally increasing. This is indicated by the annual increase in the cost of gross agricultural production per unit of land area, which amounted to 48.1% during the study period (Table 4). This result was achieved due to the intensification of farm production and an increase in the area of farmland used by the owners of P(F)Es (6.7% per year).

Table 4 Economic efficiency of the use of production resources of the Tula region
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The cost of fixed assets grew by 9.7% annually, while the return on assets increased by 64.4%. The annual productivity of labor in P(F)Es also outpaced the number of their employees, while the size of the increase in wages indicates an increase in their skill level.

The choice of the system of final performance indicators for financial and economic activities of P(F)E is largely determined by the profitability of certain types of products, sources of financing, and marketability of production. The performance indicators for production potential harnessing in independent P(F)Es of consumer and low-commodity types (not involved in cooperation) must be adjusted for the cost of services involved.

The chosen sales system largely determines performance indicators of a peasant farm existing at its own expense and the final production results. If P(F)E is actively involved in the long-term lending, then indicators of the financial condition of agricultural producers characterizing their solvency and stability become important for assessing the quality of its work. In this case, the farm’s assets, liquidity, the ratio of own, borrowed, and attracted funds are taken into account. However, the selection and adjustment of performance indicators of the P(F)E development are based on their overall totality.

For P(F)Es of the Tula Region, the highest level of marketability belongs to sugarbeet (for the entire period of the study). It either amounted to or was close to 100% (Table 5). A detailed analysis of the farm products marketability indicates that its level is still pretty low. This fact is due to the peculiarities of the organization of P(F)E as a family enterprise, the owner of which seeks to use the final product to cover the personal needs of the family and further production needs (animal feed, seeds, etc.).

Table 5 The level of marketability for main types of agricultural products in P(F)Es of the Tula region, %
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One of the most significant incentives for increasing marketability is the possibility of recouping the costs spent on production, sales, and decent business operations (settlement of payable accounts, tax charges, etc.), as well as accommodation costs for family members and employees of the P(F)E. All this largely depends on the market price of the manufactured products.

In 2018, the Tula Region farmers sold all types of crop production at a price higher than in 2017. The only livestock products sold at a lower price were poultry meat (by 34.6%), eggs (by 16.1%), and milk (by 4.6%) (Table 6).

Table 6 The sales price for the main agricultural product types in P(F)Es of the Tula region, rubles/c
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The impact of price changes on the overall result of the development of P(F)E branches can be estimated by comparing it with the total amount of costs spent on the manufacture of one production unit. Profitability is the main criterion for the effectiveness of a peasant (owner-operated) farm [11,12]. Its objectivity is determined not only by the fact that income is the natural goal of the farmer but also because the normal development of any farm is impossible without it. The received income allows us to meet consumer needs and cover family expenses. It also allows one to create an insurance fund and conduct expanded production. P(F)Es act as agricultural producers. The share of income achieved through the sale of agricultural products in all years exceeded 80% (Table 7). In this regard, the final indicators of economic efficiency are formed by this industry.

Table 7 P(F)E revenue structure in the Tula region
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The net income of farm production is defined as the difference between the total amount of income (including sales revenue) and total production costs. In general, it is calculated using the following formula:

$$ {\text{W}} = {\text{(B}} + {\text{PR)}} - {\text{IP}} - {\text{N}} $$
(1)

where:

B:

revenue (cost of sold products), rubles;

PR:

other revenue items, rubles;

IP:

production costs, rubles;

N:

taxes, rubles.

As a result of financial and economic activities, the P(F)Es of the Tula Region received income in 2014, 2015, 2016, and 2017 for the entire eight-year period of the study (2011–2018) (Table 8). Moreover, the level of profitability never reached 9%. The reason for that was the outpacing growth in taxes paid by farmers (by 34.8% annually on average) over the increase in their total income (by 22.8%).

Table 8 Profitability of P(F)Es in the Tula region
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4 Discussion

The conduct of expanded reproduction is marked with the increase in land area, livestock, gross production, crop yields, and productivity of farm animals, optimal allocation of material and monetary costs elements (salaries of employees, fertilizers, pesticides, feed, etc.), as well as the rising cost and reduction of material and moral depreciation of fixed assets. Expanded reproduction in peasant farms can be carried out in three directions, ummarized by A.V. Chayanov: “intensification … of the farm, the possibility of using commercial earnings and, finally, the expansion of land use through renting land from other owners” [3]. To the latter, we should also add the possibility of purchasing farmland and various options for updating materials and technical means, i.e., increasing the production capacity of the P(F)E, which provides a constant increase in the gross income of the farmer. However, it is important to analyze the structure of sources providing opportunities for extended reproduction and the solvency of the peasant farm (based on the results of loan repayment over several years factoring in the liquidity of owned resources, etc.). An effective sales activity can be inferred if the company’s funds predominate in it.

Recommendations for farmers on their choice of sectoral structure of economic activity are becoming particularly relevant. Our research proves that in current conditions, to ensure the reliability and stability of the P(F)E functioning, its owner must choose a model of industry specialization, which would factor in the positive impact of the maximum number of factors for the effective use of resources in specific conditions. Moreover, the model should be flexible and have maximum adaptability to the regional market and the adequate action of changing factors in the region to continually create a reliable basis for the survival of the farm and obtain the highest possible income. The development of agricultural raw materials and food market infrastructure and the market of technical resources and services is of particular importance for the diversification of agricultural production. Unfortunately, the current level of infrastructure development does not contribute to the development of agricultural diversification.

The solution to these and many other problems of efficient farm production is associated with improved market information, since, often, the lack of it allows owners of P(F)Es to carry out activities contributing to the growth of efficiency and sustainability of their farms [2].

Research showed that the efficiency of farm production largely depends on the direction and level of state support. Moreover, nowadays, P(F)Es are experiencing significant difficulties in attracting public funds, since there is no effective infrastructure to support them. Its level is insufficient to improve the efficiency of agricultural activities.

5 Conclusion

The results obtained during the research should serve as an incentive for further study of the identified difficulty causes in the development of the Russian farming sector and the development of proposals for their elimination. They can become an integral part in solving a more significant problem. We refer to the strategy for purposeful regulation of the development of small rural businesses in the regions and the country, which will ensure the growth of agricultural production and increase employment in rural areas.