Soviet Union Information Bureau


INDUSTRIAL production in the U.S.S.R. definitely passed the pre-war level during the fiscal year [The Soviet fiscal year runs from October 1 to September 30.] 1926-27 for the first time since the Revolution. The recovery crowned a steady upward struggle of over five years from the winter of 1921-22, when, as a result of the World War, the civil struggles and foreign invasions, the output of industry had fallen to i per cent of the output for 1913. Industrial production for the fiscal year 1927-28 was approximately 125 per cent of that of 1913. The recovery has been effected without the aid of a single foreign loan.

During the later years of the reconstruction period the advance in industrial production was particularly rapid. In 1924-25 the output increased Go per cent over the previous year, in 1925-26 it showed a gain of 40 per cent over 1924-25. By the end of 1925-26 in most instances existing plants and equipment were being utilized to full capacity. Further advances had to be effected largely through new construction and machinery plus greater efficiency. In this respect the year 1926-27 was a crucial year. However, the increase in production during the year was nearly 20 per cent. During 1927-28 the increase held close to 23 per cent, as compared with the same period in 1926-27.

During the past three years considerable sums have been made available for capital improvements and expansion in State industry. During 1925-26 upwards of $400,000,000 was so spent. During 1926-27 the expenditure was over $550,000,000. During the year 1927-28 over $650,000,000 was devoted to this purpose. The figures are exclusive of expenditures for the development of electrification and for new railway construction.

In the above figure for 1928, 60 per cent of the allotment comes from the resources of industry (net profits and depreciation funds), 25 per cent from assignments from the Federal budget, the remainder from long-term loans to industry.

The amounts expended for new construction, equipment and capital repairs in the various industries during the past three years are as follows (in rubles):

1925-26 1926-27 1927-28
Industries Rubles Rubles Rubles
Coal 77,080,000 157,800,000 119,700,000
Oil 150,200,000 180,400,000 197,200,000
Mining (other than above) 14,670,000 14,700,000 15,400,000
Metal 88,910,000 284,900,000 359,900,000
Electro-Technical 13,070,000 17,200,000 17,700,000
Chemical 48,310,000 60,100,000 78,200,000
Timber 17,240,000 29,500,000 39,100,000
Paper 23,920,000 37,600,000 38,200,000
Silicate 33,080,000 42,900,000 80,700,000
Textile 147,150,000 176,500,000 191,400,000
Food 67,600,000 64,700,000 77,800,000
Leather 21,680,000 16,500,000 18,600,000
Other 8,080,000 7,200,000 29,600,000
Total 810,990,000 1,090,000,000 1,263,500,000

In dollars the above totals are respectively $417,659,850, $561,350,000 and $650,702,500.

For 1928-29 the new capital allotments for industry, on preliminary figures, were from $775,000,000 to $850,000,000, including $125,000,000 for the metal industry, $114,000,000 for the oil industry, $112,000,000 for the textile industry and $82,000,000 for the coal industry.

The allotment for 1927-28 was expended in the following categories: Capital repairs 11 per cent, reequipment 56 per cent, new construction 24 per cent, housing 9 per cent. The percentage allotted for new construction has doubled in the past two years.

In 1927 the Supreme Economic Council published its program for the development of Soviet State industry during the five-year period from October 1, 1927, to October 1, 1932. The plans call for an expenditure of $3,650,000,000 on capital improvements during the period, including $1,406,000,000 for new plants. The plans contemplate a doubling of the industrial output during the five-year period, with a steady reduction of manufacturing costs and prices.

The investment fund is anticipated to come principally from the profits of State industry and from depreciation funds, which are regularly included in the costs of the industries. The total net profits of State industry for 1926-27 were upwards of $550,000,000. The depreciation funds are scheduled to yield about $1,500,000,000 during the five years. The State budget will be called on to allot from $100,000,000 to $150,000,000 annually. Long-term loans will make up the balance.

The entire industrial activities of pre-war Russia, exclusive of mining, in the present territory of the Soviet Union, were carried on by approximately 13,000 factory establishments. This figure includes only establishments employing 16 or more workers, excepting establishments employing fewer workers and also using mechanical power. During the war period many of these enterprises were liquidated, merged or reorganized. To-day the number of large enterprises operated directly by the State is estimated at 8,750. Enterprises large and small operated by the State have an output of 90 per cent of the total value of industrial production. Many small industrial establishments are operated by industrial cooperatives or by private enterprise.

The State trusts, which operate as autonomous units for production, are held responsible by the Government through the Supreme Economic Council for results in economy, efficiency, development and profits. There may be several of these trusts operating in a single industry, divided according to geographic or other reasons. Certain trusts may also be responsible only in the Constituent Republic in which they operate. For marketing purposes and for the purchase of raw material and equipment, each individual industry is organized in a syndicate, in which the producing trusts have representation.

The trusts are built chiefly on the horizontal principle, combining industrial units of uniform type. A smaller number are trusts of the vertical type, merging interdependent industrial units in the consecutive phases of the production process.

At present there is a twofold trend in State industry. There is a tendency to give more power and initiative to the management of individual plants and to localize responsibility. A decree issued in 1927 embodied this principle. It was designed to promote productive elasticity and cut down bureaucratic procedure. There is also a second trend towards concentration and mergers, which is resulting in more unified management and reduction of production costs.

Private interests are free to enter the industrial field. Any citizen may start without formality a private enterprise employing not over 20 workers and clerks. Private enterprises employing over 20 persons and not over ioo persons may be opened with the permission of the local authorities. For larger enterprises a special leasing or concession agreement is necessary.

Private concessions for developing the natural resources of the country are operated under leases for a limited period of years (see section under Concessions). Numerous productive enterprises are conducted by cooperative organizations.

Industry is controlled and coordinated by certain specially created Government organs. Chief of these are the Supreme Economic Council and the Council of Labor and Defense.

The functions of the S.E.C. are twofold, both regulatory and directive. Its regulatory activity extends over all industries, State, co-operative and private. It publishes regulations for all industries and exercises a general supervision in accord with the working out of a general industrial policy. In its directive function the S.E.C. exercises a centralized direction over all State industries of federal scope, which include the greater part of the large industries. The S.E.C. exercises control over the Supreme Economic Councils of the six Constituent Republics, which direct industrial enterprises of republican scope, and, through regional and local organs, enterprises of localized activity.

The Council of Labor and Defense includes in its functions the standardization of products, inspections, tests, etc. Its most important activity, that of planning production in all branches along the lines of a scientifically worked out scheme designed to meet the needs of consumption, is exercised through a special organ, Gosplan (the State Planning Commission). Gosplan has become of great importance in the task of achieving a balanced economy. Through its work the country has been able to eliminate waste production and to direct new capital investment along the lines of most urgent need.

Gosplan (with its six coordinated bodies in the Constituent Republics) prepares "control figures" which make it possible to ascertain the main tendencies of economic development and to outline the fundamental lines of economic policy. These "control figures" bearing upon the entire national economy of the U.S.S.R. first appeared in 1925 for the fiscal year 1925-26. The experiment proved of great value, despite the imperfections inevitable in a first attempt. The figures for 1926-27 and 1927-28 represented a solid achievement in economic balance. A general five-year plan of economic development (beginning from October 1, 1927) has also been worked out.

Statistics on the output of industry (in millions of rubles):

1924-25 1925- 26 1926- 27
Census industry (1) 6,758 9,956 11,115
Per cent increase over preceding year ... 47.3 11.6
Of this:
State 6,109 8,918 10,154
Co-operative 383 639 691
Private (including concessions) 266 399 270
Small scale industry 1,718 1,963 2,038
Per cent increase over preceding year ... 14.3 3.3
Of this:
State 1,325 1,526 1,579
Cooperative 348 389 412
Private (including concessions) 45 48 47
Total industry 8,476 11,919 13,153

Indexes of the physical volume of output of large-scale State industry:

Year Per cent 1921-22 Per cent Gain over Preceding Year
1921-22 100 ...
1922-23 145.8 45.8
1923-24 190.7 30.8
1924-25 310.9 63.0
1925-26 443.8 42.7
1926-27 520.1 17.2
1927-28 629.3

Finances of large State industries:

      Profits 521,000,000 676,000,000 680,000,000
      Losses 63,000,000 66,000,000 80,000,000
Net Profit 458,000,000 610,000,000 600,000,000
Depreciation Fund 277,000,000 360,000,000 398,000,000
      Taxes paid to govt 169,000,000 259,000,000 379,000,000
      Financing by govt 125,000,000 325,000,000 536,000,000
Net receipts from or payments to the govt − 44,000,000 + 66,000,000 + 157,000,000
Credits 564,000,000 431,000,000 454,000,000
Total Net Income 1,255,000,000 1,467,000,000 1,609,000,000
Of this:
      Capital expenditures 385,000,000 810,000,000 1,090,000,000
      Operating Funds 870,000,000 657,000,000 519,000,000
Total 1,255,000,000 1,467,000,000 1,609,000,000

Thirty-five new scientific industrial institutes have been created since the Revolution to carry on research in various branches of industry. These include chemical, radio, silicate, automobile, mineral, thermo-technical, electro-technical, peat, leather, tobacco, metallurgical, mining, geophysical, hydraulic, oil, physico-technical, sugar, coal and agricultural institutes. Index of prices charged by State trusts to distributors (1913 == 100):

1923-24 1924-25 1925-26 1926-27 Jan 1, 1928
(Annual Averages)
Mining 177.7 152.8 155.8 143.9 142.6
Silicate 258.1 227.6 224.5 216.7 210.6
Metal 208.1 171.4 167.9 170.3 168.8
Electre-Technical 262.9 230.6 213.1 161.6 161.6
Chemical 199.1 173.3 173.8 169.8 167.8
Textile 255.2 219.4 214.5 192.4 192.3
Leather 240.1 176.7 171.4 158.8 158.8
Timber 152.6 168.3 263.1 249.3 249.3
Paper 227.9 190.5 189.8 170.0 168.9
Food 236.0 231.5 219.1 209.2 209
Average for all industries 226.6 198.9 198.0 185.7 183

OIL: The Soviet Union stands third among oil-producing nations. Its output in 1927-28 was nearly 25 per cent above pre-war production.

For purposes of production the oil industry is mainly conducted by three State Trusts, operating respectively in the fields of Baku, Grozny and Emba. The Oil Syndicate, in which the three trusts have representation, handles the marketing. Before the war the Russian oil industry was hampered materially by uneconomic methods and the clashes of small economic units. Labor conditions were bad and early in the century a series of strikes crippled production. The nationalization of the fields under the new régime brought to the industry cohesion and a rational plan of development, incidentally making possible large economies of operation. Since nationalization the industry has been developed conservatively for the future, rather than for snap profits, and substantial technical improvements have been effected.

During 1926-27 close to $100,000,000 was spent for new construction, equipment and capital repairs in the industry. A similar sum was allotted for 1927-28. In Grozny in the early part of 1928 only 0.2 per cent of the output was from wells in operation when the fields were nationalized in 1918. In Baku the percentage was somewhat higher.

The output for the year increased 17 per cent in 1925-26, nearly 25 per cent in 1926-27 and 13 per cent in 1927-28.

The steady increase in output is shown in the following table:

Year Metric Tons
1913 9,215,911
1920 3,893,000
1921-22 4,629,000
1922-23 5,166,372
1923-24 5,942,290
1924-25 6,960,600
1925-26 8,142,000
1926-27 10,184,000
1927-28 11,502,000

Production during 1926-27 was divided among the different fields as follows (in metric tons):

Baku 6,893,000
Grozny 2,956,000
Etnba 252,000
Kuban 83,000
Total 10,184,000

Though the oil output increased nearly 25 per cent in 1926-27, the average number of workers employed decreased from 37,444 in 1925-26 to 36,598 in 1926-27.

New drillings in 1926-27 were 367,567 meters, as compared with 286,958 meters in 1925-26 and 185,265 meters in 1924-25 - a gain of 100 per cent in two years. The drillings for 1926-27 exceeded by nearly 50 per cent the figure of 249,000 meters in 1914.

Average number of wells in daily operation: 1924-25, 2,278; 1925-26, 2,720; 1926-27, 3,168.

The improved technical condition of the fields as compared with pre-war conditions is notable. Electrification is general whereas only one-fourth of the wells were electrified before the war. Deep pumping is rapidly replacing the old baling method of exploitation. Rotary drilling, virtually unknown before the war, was used for two-thirds of the drilling in Baku and Grozny in 1927. Hermetic exploitation, unknown before the fields were nationalized, is now in general use, with a resultant great saving in gas and the lighter oils.

During the past few years the refineries at Baku and Grozny have been largely refitted and modernized. They are steadily being enlarged. New refineries are under construction at Batum and Tuapse. New cracking plants are being built at both Batum and Grozny.

Oil refined at Baku and Grozny (metric tons):

1925-26 1926-27 Per cent increase
Baku 3,481,000 3,988,000 14.9
Grozny 2,148,000 2,642,000 23.0
Total 5,629,000 6,630,000 17.8

Refining operations in 1927-28 aggregated 8,760,000 metric tons.

The pipe line from Grozny to the Black Sea port of Tuapse, 391 miles, was completed early in November, 1928. The existing Baku-Batum pipe line is being remodeled to carry crude oil instead of kerosene and an additional pipe line is now under construction.

Oil exports for 1927-28 were nearly triple those of the year 1913. The increased exports are attributable to the increased production, combined with the fact that the present population of the U.S.S.R. is 18 per cent less than that of the former Russian Empire in 1912, plus the fact that the spread of electrification has cut down the domestic demand for kerosene. The character of the exports has greatly changed since prewar days. In 1913 kerosene and lubricating oils made up 77.4 per cent of the exports. By 1926-27 the percentage of kerosene and lubricating oil had fallen to 31.2 per cent, while gasoline nearly equalled both combined.

The Amtorg Trading Corporation of New York, American representatives of the Soviet Naphtha Syndicate, announced in the spring of 1928 that various contracts with the Standard Oil Company of New York and the Vacuum Oil Company had brought the purchases by those corporations of Soviet oil products to about $10,000,000 per year. The oil is used in markets in the Near East.

On January 1, 1928, a contract between the Soviet Naphtha Syndicate and the Spanish Oil Monopoly went into effect whereby the Naphtha Syndicate will supply the Spanish Monopoly with 520,000 tons of Soviet oil products, or about 6o per cent of the requirements of the Monopoly.

Soviet oil exports during recent years:

Year Metric Tons
1913 947,700
1922-23 309,716
1923-24 723,176
1924-25 1,337,100
1925-26 1,473,150
1926-27 2,038,800
1927-28 2,683,700

Oil exports, classified, for the past few years and for 1913 (metric tons):

1926- 27 1925- 26 1913
Kerosene 438,400 305,500 440,200
Gasoline and Ligroin 599,400 406,300 152,200
Lubricating Oils 167,800 140,300 238,700
Heavy Solar Oil 30,900 50,200 51,000
Mazut (Fuel Oil) 549,800 358,500 64,900
Gasoil 125,000 103,5001
Crude Oil 127,500 109,500 700
TOTAL 2,038,800 1,473,800 947,700

Italy was the leading country for Soviet oil exports in 1926-27, taking over 23 per cent of the total. France and England were next, each with about 19 per cent. A feature of the export trade for 1926-27 was the by France, Spain, Egypt and India.

Exports by countries in metric tons:

Country 1926- 27 1925- 26 1913
Italy 477,700 380,600 12,000
France 386,100 179,400 112,400
England 381,000 384,700 178,300
Germany, Austria, Czecho-Slovakia 346,300 241,400 137,000
Egypt and India 156,200 84,500 123,000
Belgium and Holland 69,400 62,300 116,000
Spain 69,200 14,800 ...
Turkey, Greece and Bulgaria 58,000 61,700 149,000
Baltic States and Finland 45,400 31,900 47,000
Scandinavian countries 11,300 13,900 ...
Other countries and bunker Oil 38,200 18,600 73,000
TOTAL 2,038,800 1,473,800 947,700

In 1927-28 the principal countries receiving Soviet oil exports were Italy 493,900 metric tons, Great Britain 387,400, France 354,800, Germany 344,200, Egypt 218,700, Spain 206,200 (a three-fold increase), India 154,900 (a six-fold increase).

Soviet petroleum products in 1926-27 filled about a half of the requirement of the Italian market, about 18 per cent of the French, 15 per cent of the Spanish, 16.5 per cent of the German and 17 per cent of the Belgian requirements. English imports of Soviet oil products made up about per cent of England's total oil imports and 10.3 per cent of imports of those varieties of oil imported from the Soviet Union.

The value of Soviet oil exports in 1926-27 was 83,300,000 rubles, an increase of nearly 18 per cent over the previous year. The increase in the volume of exports was 38.4 per cent. In 1927-28 the value of Soviet oil exports was 97,878,000 rubles.

During 1926-27 the value of machinery and equipment imported from the United States by the Soviet oil industry was $4,646,177.

COAL.-The Soviet coal industry has quadrupled its production during the past seven years. The output of the State trusts in 1926-27 was 30,940,000 metric tons, and various private enterprises, operating under leases, brought the total production to 32,500,000 metric tons, or 15 per cent above the production for 1913 in the present territory of the Soviet Union. The increase in output for the year, as compared with 1925-26, in the State trusts, was 27 per cent. In 1927-28 the output of the State trusts was 34,111,000 metric tons.

Many mines, with their equipment, were destroyed during the civil wars and intervention, and in 1920 production had fallen to about 8,000,000 tons.

Though the bulk of the country's coal reserves are in the Asiatic section, 75 per cent of the output comes from the coal mines of the Donetz Basin in the Ukraine.

About $80,000,000 was invested in 1926-27 for capital improvements in the coal industry. For 1927-28 about $65,000,000 was allotted and for 1927-28 the sum of $77,000,000. The money comes mainly from the profits of the industry.

With the expected development of existing and new mines annual production is expected to increase by 1932 to 57,000,000 metric tons, or more than double the pre-war rate.

Many technical improvements unknown before the war have been introduced into the industry. Coal-cutting machines, of which there were none in 1913, accounted for 11.4 per cent of the production in 1926-27--in the Donetz Basin 16 per cent. Production by cutting machines will provide nearly one-third of the output in the Donetz Basin in 1928-29. The Donugol Trust reported that 75 per cent of its mechanical installations were driven by electricity in 192627.

A number of American engineers have been engaged to assist in the development of plans for the opening of new mines. The consultant American firms include Stuart, James and Cooke of New York and Allen and Garcia of Chicago. The Government's plans for the industry for the next five years call for the opening of a large number of mines fully supplied with modern production and loading equipment. This program will cost about $350,000,000.

There were 217,061 workers employed in the coal industry in 1926-27. Production per man is still very low by western standards, though in the past two years it has increased 32 per cent. The monthly coal output per surface miner in the Donetz Basin in 1913 was 58.2 metric tons; in 1927-28 it was 62.1 metric tons. However, production per man for all workers was still below that of 1913, due to the reduction of working hours. In 1913 surface workers had a workday of 10 to 12 hours and underground men 8 to 10 hours. At present surface men have a workday of 8 hours and underground men 6 hours. Wages are double those of 1913, plus cheap rent, vacations with pay and social insurance.

Coal production in U.S.S.R. by State trusts, with comparison of production in present territory in 1913:

Year Thousands of metric tons Percentage of 1913
1913 28,356 100.00
1920 8,193 28.8
1921-22 9935 35.0
1922-23 12,132 42.7
1923-24 16,189 57.1
1924-25 16,474 58.1
1925-26 24,389 86.0
1926-27 30,950 109.1
1927-28 34,198 120.3

Coal exports, European frontiers (metric tons):

1925-26 247,571
1926-27 272,218
1927-28 219,289

PEAT.- The exploitation of the peat fields in the central section of the European portion of the Soviet Union has increased rapidly during recent years. The output:

Year Metric Tons
1913 1,500,000
1924-25 2,439,000
1925-26 3,110,000
1926-27 4,703,000
1927-28 4,900,000

METAL ORES.- The metal mining industry has been one of the slowest to recover in the Soviet Union, owing to the destruction of heavy industry during the war period, and to deterioration, etc.

The production of Iron Ore, which fell to practically nothing during the years of civil war, has made a rapid recovery during recent years. The deposits of Krivoi Rog in the Ukraine furnish about 70 per cent of the production, those of the Urals supply about 27 per cent. The output:

Year Metric Tons
1913 8,689,000
1923-24 948,000
1924-25 2,207,000
1925-26 3,308,000
1926-27 4,815,000
1927-28 5,977,000

Output of Manganese Ore, in thousands of metric tons:

1913 1923-24 1924-25 1925-26 1926-27
Nikopol 251 100 380 815 925
Chiaturi 970 320 436 772 693
1,221 420 816 1,587 1,618

Production of manganese concentrates in 1926-27 was: Nikopol, 472,000 metric tons; Chiatur1, 338,000; total, 810,000.

Exports of manganese (metric tons):

1913 91,000
1926-27 785,000
1927-28 499,000

The non-ferrous metal industries in Tsarist Russia were never highly developed. In 1913 Russia produced only 27 per cent of the zinc consumed in the country, 2 per cent of the lead and 80 per cent of the copper. Four-fifths of the zinc was supplied in what is now Polish territory. Some of the large copper smelting plants in Transcaucasia were taken over by Turkey as a result of war-time changes of territory. Of recent years the non-ferrous metal industries have been rebuilt. Capital expenditures were $13,700,000 in 1927-28; they will be $22,600,000 in 1928-29. The output of copper, zinc and lead:

Copper Zinc Lead
Production (metric tons) Per cent of Total Consumption Production (metric tons) Per cent of Total Consumption Production (metric tons) Per cent of Total Consumption
1913 33,700 80 10,500 27 1,321 2
1921-22 877 --- --- --- --- ---
1922-23 2,710 --- 187 --- 190 ---
1923-24 5,720 --- 517 --- 231 ---
1924-25 12,578 42 1,493 8 644 3
1925-26 18,102 54 1,893 9.5 1,034 4
1926-27 21,926 50 2,210 8 1,274 3.6
1927-28 23,680 47 4,300 13 3,000 7

Virtually no tin or aluminum is produced in the Soviet Union. Consumption of these metals (in metric tons):

Tin Aluminum
1913 2,500 2,000
1924-25 2,200 2,000
1925-26 2,300 2,100
1926-27 2,398 1,892
1927-28 5,407 4,708

The principal Gold areas in the U.S.S.R. are east, west and central Siberia, the Urals and the Caucasus. The largest producers are the Olekma-Vitim district in the Lena-Baikal region, and the Aldan region. In the former the Lena Goldflelds concession produces about 35 per cent of the total output of the country. The Lena Goldflelds Company, which received a long-term concession from the Soviet Government in 1925, is making considerable progress in mechanizing its industrial processes.

Recently the nine former State trusts operating in the industry have been united in one large company, and an extensive development is planned.

Favorable conditions, including exemption from taxes and equipment loans, are offered by the State to individual prospectors.

Production in kilograms:

1913 49,239
1924-25 25,258
1925-26 25,149
1926-27 23,152

Platinum production before the war was carried on mainly in the Ural mines near Nizhne-Turinsk. The annual output was 27,000 pounds avoirdupois. Production was carried on by unsystematic, wildcat methods with primitive apparatus and the employment of hand labor, chiefly women. The cheap exploitation was exceedingly wasteful. Owing to the lack of capital the revival of the industry was not begun until 1924.


Year Ounces
1924 56,900
1925 94,800
1926 92,700
1927 100,000

Platinum exports in kilograms:

1924-25 2,924.6
1925-26 4,098.3
1926-27 5,073.1
1927-28 2,454.9

MINERAL SALT.- Found in the Soviet Union in salt lakes, salt wells and rock salt. The Donetz Basin is the principal producing area. Lake salt is obtained principally in the Perm and Astrakhan provinces and the Artemovsk and Slavyansk districts. Production, in metric tons:

1913 1,998,420
1921-22 787,850
1923-24 1,155,953
1924-25 1,326,939
1925-26 1,579,738
1926-27 1,908,000
1927-28 2,180,000

ASBESTOS INDUSTRY.- Production in 1926-27 was 21,500 metric tons as compared with 17,953 metric tons in 1925-26, 11,484 metric tons in 1924-25 and 22,500 metric tons in 1913. Export in 1926-27 was 9,947 metric tons; in 1925-26, 7,215 metric tons.

TEXTILES.- The restorative process in the textile industry was completed at the end of 1925-26. In 1926-27 the production of cotton goods was 113.9 per cent of that of 1913, of woolen goods 91.5 per cent and of flax, hemp and other fibers 120.6 per cent. All branches of the industry showed a healthy growth during the year.

Capital construction in the textile industry, which made it possible for the industry to surpass the pre-war rate of production, was carried out as follows during the reconstruction years (in millions of rubles):

1922-23 1923-24 1924-25 1925-26 1926-27 Total
Capital repairs 5.0 14.0 23.0 40.6 26.5 109.1
Re-equipment and broadining out
of existing mills
3.0 20.5 35.0 82.0 100.4 240.9
New mills ... ... ... 11.5 28.0 39.5
Total 8.0 34.5 58.0 134.1 154.9 389.5
Millions of dollars 4.1 17.8 29.9 69.1 79.8 199.7

The sum of $101,182,000 was devoted to capital expenditures in the industry during the year 1927-28.

The textile industry showed net profits of $100,425,000 in 1925-26 and $109,695,000 in 1926-27. Between January 1 and October 1, 1927, the wholesale prices of textiles were reduced 10.8 per cent.

The seven-hour day for workers had been largely introduced in the textile industry by the spring of 1928.

Statistics of production follow:

1924-25 1925-26 1926-27
Number of Factories 159 177 199
      Cotton Yarn, metric tons 178,476 232,700 268,40
      Unbleached cloth, meters 1,604,500,000 2,132,500,000 2,458,300,000
      Finished Cloth, meters 499,000,000,367,800 2,030,300,000 2,342,600,000
Number of workers 367,800 458,500 474,100

1924-25 1925-26 1926-27
Number of Factories 81 76 75
      Woolen Yarn, metric tons 27,664 32,943 41,248
      Unbleached Cloth, meters 52,580,000 67,501,000 84,142,000
      Finished Cloth, meters 49,287,000 64,814,000 85,379,000
Number of Workers 62,000 63,300 62,400

1924-25 1925-26 1926-27
Number of Factories 55 60 62
      Linen Yarn, metric tons 47,536 66,003 67,612
      Linen Cloth, sq. meters 134,076,000 171,184,000 194,669,000
Capital Expenditures of the entire textile industry, rubles 52,300,000 147,150,000 176,500,000

For 1927-28 the output of cotton yarn was 314,000 metric tons, an increase of 23.5 per cent, cotton cloth 2,536 million meters, an increase of 8 per cent. The output of woolen yarn was 48,100 metric tons, an increase of 16.9 per cent, woolen cloth 9 million meters, an increase of 15.8 per cent. Production of linen fabrics decreased 2 per cent.

METAL INDUSTRY.- In the three years from 1924-25 to 1927-28 the Soviet metal industry increased its output of pig iron, steel and rolled iron 250 per cent. The output of steel and rolled iron now equals pre-war production; pig iron is So per cent of pre-war. Production of agricultural machinery and of several kinds of technical machinery has progressed far beyond the pre-war level. Many new plants with the newest technical apparatus are under construction. An ambitious program for the expansion of the industry has been adopted for the next five years. The sum of $175,000,000 was allotted for capital improvements in the industry during the year 1927-28, including mining.

Statistics of the industry:

Number of Units in Operation (Maximum)
1924-25 1925-26 1926-27
Blast Furnaces 45 59 68
Open Hearths 115 152 io6
Rolling Mills 241 245 244
Production, metric tons
Pig Iron 1,291,511 2,194,665 2,963,253
Steel 1,868,342 2,910,949 3,586,249
Rolled Iron 1,390,203 2,249,922 2,730,547
Output of Iron Ore, metric
tons 2,132,830 3,306,534 4,816,703
Capital Expenditures for the
Whole Metal Industry,
rubles 60,000,000 188,910,000 284,900,000
Average Number of Workers 362,555 483,159 513,658

In 1927-28 theoutput of pig iron was 3,281,000 metric tons, steel 4,150,000 metric tons, rolled iron 3,367,000 metric tons, iron ore 5,977,000 metric tons.

Production of locomotives and railroad cars:

Locomotives Cars
1923-24 141 433
1924-25 186 750
1925-26 305 1,701

Production of industrial machinery has shown great advances in the past few years. Production of agricultural machinery in 1927-28 was more than double the pre-war output. The value was 132,100,000 rubles, as compared with 99,600,000 rubles in 1926-27.

Production of agricultural implements:

1925-26 1926-27
Plows 933,458 1,000,000
Drills 60,641 60,000
Threshers 56,492 69,000
Binders 106,643 174,000
Scythes 3,067,000 3,700,000
Sickles 1,867,000 993,000

ELECTRO-TECHNICAL INDUSTRY.- The output of this industry is nearly double the pre-war production. Equipment and technical efficiency are well above the pre-war standard. The Electro-technical Trust has plants at Moscow, Leningrad, Kharkov and in the Urals. The output of 1926-27 included four io,000 horsepower hydraulic turbines. During the year the Trust completed the electrical installations for the first electrified railroad in the Soviet Union, running from Baku to Surakhany, in the heart of the oil fields.

Production, value in rubles:

1925-26 143,518,000
1926-27 167,454,000
1927-28 (estimate) 220,890,000

Production of electrical equipment:

Production 1925-26 1926-27
Motors and Generators, kw. capacity 177,605 300,000
Transformers, kw. capacity 257,995 270,000
Insulating cable meters 25,845,907 31,500,000
Cable, meters 1,961,122 2,400,000
Electric lamps 14,422,398 15,000,000
Telephone apparatus, sets 57,097 95,000

In 1927-28 the output of the electro-technical industry increased 32.5 per cent. Production of telephone, telegraph and radio apparatus increased 46 per cent. Production of electric lamps reached 15,500,000.

PAPER INDUSTRY.- Paper consumption in the Soviet Union has risen with the spread of literacy. In 1927-28 the per capita consumption of paper was estimated at 3.5 kilograms, as compared with 2.7 kilograms in 1913. The paper industry has tripled its output in the past three years. In 1926-27 production of paper was 6.8 per cent above that of 1913. In 1913, 40 per cent of the paper used was imported, in 1926-27 Only 25 per cent. Only 3 per cent of the newsprint paper used in 1926-27 was of domestic manufacture, but the opening of several new plants increased this to 20 per cent in 1927-28.

The two principal new plants are the Balakhna plant near Nizhi-Novgorod, opened to partial operation in 1928, and the plant at Kondapoga in Karelia, now nearing completion. The Balakhna plant will have an annual output of 60,000 tons of newsprint by 1930-31. These new plants with their modern equipment will cut the cost of newsprint nearly o per cent. By the end of 1928 for the first time Soviet newspapers in the central district had a full supply of domestic newsprint paper.

The paper plants now in construction assure a domestic supply of paper of all kinds aggregating 7,5,000 tons annually by 1930-31 or six times the pre-war supply.

Output, in thousands of metric tons:

Paper Cardboard Cellulose Woodpulp
1923-24 117.9 12.4 35.5 44.4
1924-25 213.2 20.2 54.0 54.2
1925-26 257.3 26.4 68.4 68.0
1926-27 267.5 39.0 75.6 73.2

Imports of paper in 1926-27 were 107,856 metric tons, as compared with 141,300 metric tons in 1925-26 and 157,400 metric tons in 1913.

CHEMICAL INDU5TRY.- Statistics of output of the heavy chemical industry, in metric tons:

Year Acids Alkalis Superphosphates Other Salts
1923-24 132,977 116,207 26,653 59,608
1924-25 165,344 150,482 52,997 69,851
1925-26 220,785 199,634 80,618 89,653
1926-27 256,116 242,612 89,975 103,538

Output of alkalis for the first half of 1927-28 was 137,700 metric tons, an increase of 19 per cent over the corresponding period of the previous year.

LEATHER INDUSTRY- The leather industry is comparatively new in Russia. Before the war the country exported raw hides and imported large quantities of leather. To-day the industry is able to handle the domestic requirements for sole leather and part of the requirements for upper leather. During the three years ending September 30, 1927, over $16,500,000 was spent for capital construction in the State leather factories. The capacity of the tanning factories has been raised to nearly 11,000,000 hides per annum. Pre-war production in the industry was passed in 1925-26. The output has more than doubled in the past few years.

During 1926-2 7 the output of hides in the U.S.S.R. was 10,200,000. Of these about two million were used locally by peasants, 7,350,000 were used in large State industries, 2,000,000 in small handicraft industries and the remainder by cooperatives and private enterprises.

Statistics of census (includes all industries employing 16 or more workers and using mechanical power, or employing 30 or more wokers without mechanical power) leather factories:

Number of Enterprises Number of Employees Value of output
1922-23 580 31,599 $75,190,000
1923-24 555 29,225 83,430,000
1924-25 559 33,956 112,270,000
1925-26 553 35,374 164,800,000
1926-27 487 34,178 182,310,000

In addition to the above, the output of small hand enterprises in 1926-27 is estimated at $58,710,000 or nearly a third of the census industry.

Output of hides and skins in large-scale leather factories, in thousands:

Year Hides Skins
1924-25 7,798 5,886
1925-26 8,299 8,656
1926-27 8,968 10,964
1927-28 10,000 15,600

Output of shoes (pairs):

1916 10,800,000
1926-27 14,700,000
1927-28 23,000,000

Imports of dressed leather were $2,107,380 in 1926-27, as compared with $2,861,340 in 1925-26.

RUBBER INDUSTRY.- The rubber industry passed the prewar volume in 1926-27. Production of rubber shoes (pairs):

1913 27,855,00
1925-26 25,310,00
1926-27 29,633,70
1927-28 36,248,00

Total production in the industry, value in rubles:

1925-26 131,733,000
1926-27 155,312,000

GLASS AND CHINA.- The World War virtually destroyed or a time the glass and china industries of Russia. Much of he output was in territory lost as a result of the war. Within he plants that still remained there had been much destruction nd deterioration. In 1920 the output of the glass industry was 3.2 per cent of pre-war and in the china industry 4.5 per cent. By 1926-27 the glass industry reached 5 per cent of pre-war production and the china industry 105 per cent.

The output, in rubles:

Year Glass China
1925-26 76,985,000 30,870,000
1926-27 90,682,000 38,323,000

Output in metric tons:

Year Glass China
1913 85,000 44,000
1924-25 175,000 28,000
1925-26 246,000 35,000
1926-27 282,000 45,000

CEMENT INDUSTRY.- The output in recent years, in metric tons:

1924-25 716,468
1925-26 1,317,600
1926-27 1,556,700
1927-28 1,836,900

Export of cement, in metric tons:

1913 6,903
1924-25 30,078
1925-26 38,612
1926-27 48,522

MATCH INDUSTRY.- During the past few years there has been a great improvement in equipment and standardization in the industry, and in the quality of the product. An export trade is being developed to Denmark, Finland, China, Great Britain, the United States and North Africa. The output, in cases of 1,000 boxes:

1913 3,703,000
1922-23 1,425,233
1923-24 1,882,587
1924-25 3,162,100
1925-26 3,593,900
1926-27 4,199,700
1927-28 5,457,100

Exports for 1926-27 were 82,000 cases. For the first six months of 1927-28 they were nearly 400,000 cases.

TOBACCO INDUSTRY.- The output, in millions of cigarettes:

1913 25,888
1921-22 6,664
1922-23 12,508
1923-24 12,862
1924-25 25,022
1925-26 35,125
1926-27 39,443

The output of makhorka (a cheap tobacco mixture smoked by the peasants) in metric tons:

1913 79,000
1924-25 29,072
1925-26 48,879
1926-27 97,000

Total output of tobacco industry, value, in thousands of rubles:

1925-26 103,766
1926-27 108,854

SUGAR INDUSTRY.- A large amount of the best beet-growing territory was lost to Russia as a result of the World War. In addition, during the World War and the civil conflicts, many sugar factories were destroyed or severely damaged. In 1921 sugar production fell to 2.9 per cent of the pre-war rate. The recovery of the industry was belated, but the output is now apidly approaching the pre-war rate. During the past three years $20,000,000 has been spent on capital improvements in the industry.

In technical organization the industry has made much progress in recent years. The number of workers employed in the industry per unit of production was 20 per cent less in 1926-27 than in 1914. Fuel consumption expressed as a percentage of weight of sugar beets was 8.5 per cent, as compared with 22 per cent in 1920 and 8.7 per cent in 1914.

Plants in operation in 1926-27 numbered 155.

Statistics of output, in metric tons:

1910-13 (average) 1,513,000
1924 411,000
1925 963,000
1926 871,019
1927 1,336,570

Persia and Afghanistan are the main markets for sugar export, but Soviet sugar is now finding its way to the border countries and as far west as France. Exports, in metric tons:

1924-25 26,140
1925-26 45,477
1926-27 121,983
1927-28 132,250

VEGETABLE OIL INDUSTRY.- Output of the oil-pressing industry, in metric tons:

1924-25 173,269
1925-26 228,531
1926-27 148,000
1927-28 243,000

DISTILLED SPIRITS.- Late in 1925, because of the wide use of bootleg vodka of inferior quality, some of it dangerous to health, the Government monopoly was authorized to produce and dispense vodka up to the pre-war strength of 40 per cent alcohol. Alcoholic beverages are sold under severe restrictions regarding quantity to one person, etc. The sale to minors or intoxicated persons is prohibited.

Production of vodka, in hectoliters:

1913 4,636,000
1925-26 1,577,000
1926-27 1,804,000

FISHING INDUSTRY- The annual fish catch in the Soviet Union is now about equal to pre-war. Eleven State trusts in the various fishing centers of the country, with a capital of $25,000,000 and an annual output of $50,000,000 handle more than half of the fish put on the market. The largest trust is the Volga-Caspian Fish Trust which operates at the mouth of the Volga.

Of the total catch at present only 10 per cent is frozen, 2 per cent canned, the remainder salted or smoked.

Annual catch, in metric tons:

1913 887,600
1923 490,000
1924 535,600
1925 635,500
1926 758,500
1927 787,900

Exports of fish products, value in rubles:

1925-26 1926-27
Fish 4,507,000 3,823,000
Black Caviar 4,191,000 2,887,000
Red Caviar 1,674,000 618,000
Fish Glue 84,000 125,000

The value of exports of fish products for 1927-28 was 12,458,000 rubles, an increase of nearly 6o per cent over the previous year.

A Fisheries Convention between the Soviet Union and Japan was signed January, 1928. The Convention settled questions relating to the operation of fisheries in Soviet Pacific waters by Japanese nationals, which had been pending for some years. The output of Japanese salmon canneries on the shores of Kamchatka amounts annually to between 40 and 50 million yen.

TIMBER INDUSTRY.- The timber industry has made notable advances during the past few years, though it has not yet reached the pre-war rate of production. The industry suffered a complete collapse during the period of the World War and the civil conflicts. The reconstruction of the industry began in 1921. The concentration of a major portion of the industry in a small number of State trusts, replacing the hundreds of small units of pre-war days, has resulted in effective economies and more orderly development. In 1926-27 the trusts produced over 71 per cent of the output of sawmills. They accounted for only 20 per cent of the logging and 31 per cent of the output of wood fuel, such operations being conducted largely by cooperative and private groups.

The six principal trusts are:

1. Severoles, operating in the northern part of European Russia in the region of the White Sea;
2. Karelles, operating in the territory of the Karelian Republic;
3. Sevzaples, in the northwestern part of Russia with Leningrad as its export center;
4. Dvinoles, operating in the region of the river Western Dvina;
5. Lesbel, operating in the territory of the White Russian Republic; and
6. Dalles, operating in the Far East.

Total of lumber production (In Millions of Cubic Feet):

1924-23 1925-26 1926-27
Logs 614.0 893 812
Of this produced by trusts 148.2 300.5 251
Per cent of total 24 33.6 31
W00d for Fuel 1550 1885 2400
Of this produced by trusts 142 264 477
Per cent of total 9 14 20

Production of saw-mills:

Year Cubic fee
1913 441,219,01
1924-25 196,000,01
1925-26 282,000,000
1926-27 370,000,000

The progress of the operations of saw-mills controlled by trusts during the past six years has been as follows:

No. of saw mills in operation Total No. of workers Production (thousands of cubic feet) Production per gang-saw (1,000 cubic feet)
1921-22 480 .... 61,360 71
1922-23 327 36,600 105,787 148
1923-24 362 36,763 135,211 174
1924-25 294 34,231 168,600 236
1925-26 332 38,960 209,900 269
1926-27 339 48,627 263,100 303

The production of veneer in the U.S.S.R., which is largely concentrated in the hands of the Veneer Trust, has shown an increase of 49 per cent over the pre-war production. During the past five years the industry increased its output nearly sixfold. Production of veneer:

Cubic meters
1922-23 21,484
1923-24 49,877
1924-25 69,615
1925-26 90,100
1926-27 122,600

The normal rate of annual growth of the pulpwood forests in the U.S.S.R. is about 4,910,000 metric tons, of which only about '5 per cent is exploited.

England takes over half the timber exports of the Soviet Union. Other countries of export are France, Germany, Japan, Egypt, South Africa, the United States. Total exports over the European frontier:

Metric tons Value
1925-26 1,666,700$26,795,000
1926-27 2,133,200 36,185,000
1927-28 2,495,218 41,337,000

Timber products worth $60,000 were exported to the United States in 1925-26 and $120,000 in 1926-27.

BUILDING INDUSTRY- With the general rise of industrial production has come a rapid advance in the building industry, though this advance is still behind the rapidly increasing requirements of the country.

Statistics of amounts spent for new construction and capital repairs, in millions of rubles:

Year Urban and Industrial Rural Housing Total
1924-25 860 1,216 2,076
1925-26 1,485 1,341 2,826
1926-27 1,942 1,369 3,311

Of the 4,300,000,000 rubles ($2,200,000,000) spent for building construction outside of the villages during the past three years, 30 per cent was accounted for by industrial, electrification and trade enterprises, 30 per cent for housing, 20 per cent for buildings for transport and communications, 12 per cent for public utility and Government buildings, S per cent for health and educational institutions.

The sources of finances for the entire building program of the Soviet Union are shown in the following table (in millions of rubles):

1924-25 1925-26 1926-27 1927-28 (program)
State Budget 382 548 764 994
Local Budgets 118 209 280 344
Own Resources of Industry and Population 1576 2069 2267 2367
Total 2076 2826 3311 3705

The housing shortage in the cities, inherited from the old régime, is still acute but is being markedly reduced by increasing new construction. Figures for new construction in cities and industrial communities follow:

1924-25 1925-26 1926-27
Expenditures for New Housing (rubles) 156,00,000 286,700,000 393,000,000
Dwellings Built (in sq. meters) 1,840,000 3,160,000 4,200,000
Per cent increase over previous year's expenditure 72.0 83.3 36.9

In addition to these sums expended for new housing considerable outlays have been made for capital and other repairs to houses. These amounted to the following (in rubles):

1924-25 108,000,000
1925-26 164,000,000
1926-27 185,000,000

The proportion of the expenditures for new housing in urban centers made by the various groups of builders during the past three years was as follows:

Per Cent
Industry and Power Companies 31.4
Commissariat for Transport 7.8
Municipal Authorities 22.7
Cooperatives 8.5
Private Parties 29.6
Total 100.0

SHIPBUILDING.- The building of commercial ships in the Soviet Union is an industry of recent origin. Before the war shipbuilding was confined almost entirely to the building of war vessels. In 1925-26 fabricated metal utilized in the construction of merchant ships amounted to 9,500 metric tons; in 1926-27 it was 25,700 metric tons. The maximum pre-war tonnage so used was 6,000 tons.

In 1924-25 nine vessels were launched in Soviet shipyards, 26 vessels in 1925-26, 27 vessels in 1926-27. The average tonnage was 3,700 tons as compared with 1,000 tons in prewar days. Most of the new ships are equipped with Diesel engines.

There are four large groups of shipbuilding plants, under the supervision of the Chief Metals Administration. They are located in the northwest, central, south and Far Eastern regions. The Leningrad Ship Trust is the most important.

The five-year plan for the industry calls for the completion by 1931-32 of 299 vessels with a dead weight tonnage of 994,000 tons at a total cost of $200,000,000. The new ships will be distributed as follows: 163 for Sovtorgflot (Soviet trading fleet), 117 for the Caspian service, 19 for the Naphtha Syndicate. During the fiscal year 1927-28 $27,000,000 was expended on new building.

Fur Trade- The fur trade is of increasing importance in the Soviet Union, and exports of furs have increased o per cent during the past three years.

State and co-operative organizations furnish 8 per cent of fur procurements. Private traders handle the remainder.

Value of exports, in rubles:

1923-24 51,400,000
1924-25 63,400,000
1925-26 67,537,253
1926-27 86,969,775
1927-28 120,000,000

Of the recent export the major part was handled by the State trading organizations of the Constituent Republics, nearly a fourth by the cooperatives, about 4 per cent by mixed companies (foreign private capital and Soviet State capital).

For the first time Germany replaced England as the largest customer in 1926-27, and further consolidated this position in 1927-28. In the latter year, Germany took 45 per cent of the fur export, England 25 per cent, the United States zo per cent, France 8 per cent. The major part of the furs, however, eventually found their way to the United States. In 1927-28 for the first time there was fur export to South America.

Export of various furs in 1926-27 and 1925-26:

Squirrel 8,582,760 10,389,059
Dressed Squirrel 11,038 16,807
Fox 348,436 385,792
White Fox 103,845 62,172
Marten 28,691 55,828
Ermine 595,101 680,951
Kolinsky 259,244 344,071
Mink 50,226 48,331
Sable 11,415 18,166
Fitch 917,222 961,611
Hare 6,654,912 3,371,125
Marmot 466,218 650,289
Korsuk 22,836 71,629
Peschanik 4,240,065 5,439,407
Suslik 2,659,519 275,303
Wolf 14,234 20,857
Otter 896
Bear 3,090 2,343
Lynx 3,371 3,039
Wolverine 1,271 1,677
Cat 6,233 14,845
Jackal 3,259 8,406
Dog 109,019 3,398
Burunduk 681,942 405,799
Weasel 46,379 42,094
Mole 66,860 8,092
Sea Lion 1,742 14,706
Dressed Suslik 21,628 8,637
Dressed Squirrel spines 46,780
Badger 66,062 54,721
Karakul 804,723 287,408
Krimmer 10,606 32,694
Pony 296,016 213,766
Muflon 234,987 95,705
Merlushka 900,552 77,378

(1) Census industry includes all industries employing 16 or more workers and using mechanical power, or employing 30 or more workers without mechanical power.