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Economy of Russia – Overview
Russia’s move toward a centralized state under the leadership of President Vladimir Putin from 2000 onward has seen the country greatly enhance its geopolitical influence and fueled commodity-based economic growth.
General forecasts for Russia’s commodity growth and economic outlook are improving and the commodity-dependent economy is expected to see growth according to World Bank forecasts.
Rises in oil prices will support growth as it is a fundamental aspect of their economy. The Central Bank of Russia has stated that if oil prices fall below $40 per barrel it would cause GDP to fall by 5%.
The country’s heavy reliance on commodity exports makes it susceptible to recessionary pressures.
Russia's Top 5 Commodity Exports
|Crude & Refined Oil||$255 billion|
|Natural Gas||$43 billion|
Russia's Other Notable Exports
- Machinery, including computers $6.8 billion
- Wood $6.5 billion
- Gold – $5.8 billion
- Diamonds – $4.6 billion
- Whole fish (frozen): $2 billion
Russia's Top 5 Commodity Imports
|Refined Oil||$754 million|
|Palm Oil||$647 million|
Russia's Other Notable Imports
- Temperature-change machines: US$6.1 billion
- Computers, optical readers: $3.8 billion
- Taps, valves, similar appliances: $1.6 billion
- Centrifuges, filters and purifiers: $1.3 billion
- Liquid pumps and elevators: $1.3 billion
More Information on Russia's Imports/Exports
Russia is the world’s largest producer of crude oil, and it has an estimated 80 million barrels of proven oil reserves.
Russia exports about 6 million barrels of oil per day and consumes about 3.5 million barrels per day domestically.
Mineral fuels including oil account for over 47% of Russia’s total exports
Iron & Steel
Exports of iron and steel total around $14 billion annually, which makes the country the fourth-largest steel exporter and represents about 6.5% of global steel exports.
Over the last decade Russia has exported about five times more steel than it has imported.
According to the United States Geological Survey (USGS), Australia has the most iron ore reserves by some margin, followed by Russia, China and Brazil.
Russia is the world’s biggest wheat exporter. The country has been able to solidify its dominance as a result of reducing crop yields in rival countries like Australia, canada, and the United States.
An increasing number of wheat shipments to Asia, a region that previously sourced its grain elsewhere, should see Russia increase market share further.
Russia is currently ranked fifth in the world for corn exports and ships in the region of 4.5 million tonnes annually, mainly to European Union destinations.
Other significant importers of Russian corn are Turkey, Iran and Vietnam.
The country is increasing its corn output and the USDA has predicted that Russia and Ukraine will surpass Argentina and Brazil as major corn exporters by 2022.
Export figures for copper each year are in the region of $3.3 billion.
Russia recent scrapped export duties for refined nickel and copper cathode as a condition of its accession to the World Trade Organization.
The leading zinc and copper miner in the country, Ural Mining and Metallurgical Co, sells half of the copper it mines to export markets.
Three nations dominate Russian tea imports, accounting for nearly 70% of total volumes shipped. Sri Lanka comes out on top, supplying 29.91% of tea imports, followed by India with 23.52% with Kenya rounding off the big three by shipping 15.57% of total tea imports to Russia in 2015.
Coffee consumption in Russia is predicted to grow at a slightly higher rate than tea, and . Euromonitor predicts a compound annual growth rate of 2% annually until 2020.
Imports of U.S. soybeans have been restricted due to phytosanitary concerns raised by the Government of Russia
Russia is estimated to have 8,000 to 10,000 food processing plants, but this growing sector lacks sufficient domestic supplies of key ingredients, such as soy products, prompting producers to seek the required food processing ingredients from other countries.
Wine and spirits
Russia is the world’s 7th largest wine market with a growing consumption currently estimated at 10 liters per person per year
Since 2009, Russia has significantly increased imports of U.S. bourbon and rum.
All data sourced from the Observatory of Economic Complexity unless otherwise stated.