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Established in 2008, AgroTerra is a significant participant in the agricultural sector, focusing on the cultivation and distribution of commodities like sugar beet, wheat, and soybeans. The company has cultivated an area of about 265,000 hectares (654,829 acres), placing it among the top 20 largest owners of agricultural land in Russia.
It’s unclear how the decree will affect AgroTerra’s business practices. As of right now, the company has not received any additional information about the decree on the transfer of shares within the AgroTerra Group’s authorized capital to the temporary management of Rosimushchestvo, according to a company spokesperson. The business has guaranteed that it is carrying on with business as usual, putting its main attention on the current sowing campaign, despite the ambiguity.
As part of a larger pattern, Russia has been seizing assets owned by foreigners in retaliation for sanctions and other actions taken against Russian businesses overseas. Putin issued an executive order in April 2023 enabling Russia to seize assets from foreign businesses connected to “unfriendly countries,” including real estate, securities, and property rights.
These actions have consequences that go beyond the impacted businesses and their investors. They represent a risk to the world’s agricultural supply chain, which could cause disruptions to food exports and production. Additionally, the action might heighten hostilities between Russia and Western nations, making efforts to end the Ukrainian conflict and normalize relations between the two countries even more difficult.
The agricultural sector and international markets will be closely watching the developments as they pertain to the effects of Russia’s asset seizures on trade, diplomatic relations, and food security.