Technological transformation of reindeer husbandry in the Arctic Zone of Russia

Over the past few decades, the reindeer husbandry in Russia has gradually degraded. This is manifested in the reduction of the reindeer herd, lower economic efficiency of production, and a lack of financial resources for development. According to government statistics, in 2022 the unprofitability rate of domestic reindeer husbandry was 51.73%. The state constantly provides financial support to reindeer farms, compensating up to 95% of current costs, which allows them to continue their production activities, but does not provide opportunities for development. This paper proposes a transition from a policy of financial support for the current activities of reindeer herders to a radical transformation of the industry from traditional grazing technologies to reindeer herding in hedges, as well as to the use of modern technologies for slaughtering, processing and producing reindeer products with high added value. The evaluation of such a development on the example of a particular pilot transformation project in the Chukotka Autonomous District showed the economic viability of the proposed approach. However, due to the lack of sufficient financial resources of reindeer herders, the project requires state support support and/or the search for alternative sources of financing for capital investments and working capital growth. only under this condition will the project be financially feasible and economically effective in the future. Moreover, if this project is implemented and its results are widely disseminated in the territories of the Arctic zone of Russia, it will create favorable conditions not only for the industry to overcome the crisis, but also for achieving the goals of sustainable development of the Far North.

1. Kossov V.V., livshits V.N., Shakhnazarov A.G. Guidelines for assessing the effectiveness of investment projects. 2nd ed. Moscow, Russia: OAO NPO “Izd–vo “Ekonomika”, 2000:42. (In Russ.)

2. Aleksanov D.S., koshelev V.M., Rossokhina O.A., Chekmareva N.V. Recommendations on the development of a business plan for small–scale farming in the agro–industrial sector. Moscow, Russia: FGNU “Rosinformagrotekh”, 2007:224. (In Russ.)

3. Aleksanov D.S., koshelev V.M., Chekmareva N.V. Project management in agro–industrial sector: textbook for universities. Moscow, Russia: Izdatel’stvo Yurayt, 2022:193. (In Russ.)

4. Pedro Belli, Jock R. Anderson, howard N. Barnum, John A. Dixon, Jee–Peng Tan. Economic analysis of investment operations: analytical tools and practical applications. WBI development studies. Washington, USA, 2001,264.

5. Price Gittinger. Economic Analysis of Agricultural Projects. Second Edition. The John hopkins University Press. Baltimore and london, 1982:650.

6. Methodology for drawing up a technological map and calculating standard costs of reindeer herding in the Republic of Sakha (Yakutia): methodical manual. Gos. komitet RS (YA) po delam Arktiki, FGBNU Yakutskiy NII sel’skogo khozyaystva im. M.G. Safronova. Yakutsk, Russia, 2017. (In Russ.)