SIGNIFICANT DEVELOPMENTS IN THE SOVIET BUILDING MATERIALS INDUSTRY 1954

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-01093A000900040002-4
• Release Decision: RIPPUB
• Original Classification: C
• Document Page Count: 26
• Document Creation Date: November 9, 2016
• Document Release Date: April 6, 1999
• Sequence Number: 2
• Publication Date: April 8, 1955
• Content Type: IR

CIA/RR PR-110
8 April 1955
-IN THE
OVIET ,- BUILDING MATERIALS INDUSTRY
1954
:CEN,TRAL INTELLIGENCE AGENCY
e x1999/09/02 :'CIA-RDP7,9rt, 113AQ0,0900040002-4
OFFICE OF RESEARCH AND, REPORTS
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 WARNING
This material contains information affecting
the National Defense of the United States
within the meaning of the espionage. laws,
Title 18, USC, Secs. 793 and 794, the trans-
mission or revelation of which in any manner
to an unauthorized person is prohibited by law.
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SIGNIFICANT DEVELOPMENTS
IN THE SOVIET BUILDING MATERIALS INDUSTRY
195+
CIA/RR PR-110
(ORR Project 1+7.556)
NOTICE
The data and conclusions contained in this report
do not necessarily represent the final position of
ORR and should be regarded as provisional only and
subject to revision. Comments and data which may
be available to the user are solicited.
Office of Research and Reports
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Page
Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
I. Introduction . . . . . . . . . . . . . . . . . . . . . . 2
II. Capital Investment . . . . . . . . . . . . . . . . . . . 6
III. Precast Concrete Products Program . . . . . . . . . . . . 8
A. Benefits . . . . . . . . . . . . . . . . . . . . . . 8
B. Magnitude . . . . . . . . . . . . . . . . . . . . . . 8
C. Intended Uses . . . . . . . . . . . . . . . . . . . It 9
D. Progress of the Program . . . . . . . . . . . . . . . 9
E. Planned Output . . . . . . . . . . . . . . . . . . . 11
F. Organizations Involved . . . . . . . . . . . . . . . 12
G. Implementation of the Program . . . . . . . . . . . . 14
Appendixes
Appendix A. Methodology . . . . . . . . . . . . . . . . . . 17
Appendix B. Source References . . . . . . . . . . . . . . . 21
1. Percentage of Plan Fulfillment of Soviet Producers of
Building Materials, 1951-54 ? ? . ? . . . . . . . . . . 4
2. Announced Data on Soviet Production of Cement and Brick,
1950-55 . . . , . . . . . . . . . . . . . . . . . . . . 5
3. Index of Capital Investment in the Soviet Building
Materials Industry, 19+8-55 . . . . . . . . . . . . . .
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Page
4. Planned Increases in Investment Expenditures and Reported
Increases in Investment Volume in the Consumption Sector
of the Soviet Economy, 1953-54 . . . . . . . . . . . . . 10
5. Planned Soviet Construction Utilizing Precast Concrete
Products, 1955-56 . . . . . . . . . . . . . . . . . . . 11
6. Planned. Soviet Production of Precast Concrete Products,
1954-57 . . . . . . . . . . . . . . . . . . . . . . . . 12
7. Cement Production in the USSR, 1950-55 . . . . . . . . . 18
8. Brick Production in the USSR, 1950-55 . . . . . . . . . . 19
CONFIDENTIAL
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CIA/RR PR-110 CONFIDENTIAL
(ORR Project 47.556)
SIGNIFICANT DEVELOPMENTS
IN THE SOVIET BUILDING MATERIALS INDUSTRY*
195
Summary
Evidence of shortcomings in the Soviet construction industry
emphasizes the likelihood that investment goals in the consumer goods
program will not be completely fulfilled in the Fifth Five Year
Plan (1951-55). Current information obtained from statistical data
printed in newspapers and journals shows some lag in construction
plans. The most significant lag is a failure to fulfill planned in-
creases in construction for housing, agriculture, and the light and
food industry. This lag probably is due to the continued high prior-
ity placed on construction in the heavy industry sector of the economy.
Shortcomings in the construction industry, and, to a lesser extent,
in the building materials industry, have also contributed to this
underfulf illment .
The level of capital investment in the building materials in-
dustry in the Fifth Five Year Plan was to be three times the level of
the Fourth Five Year Plan (1946-50). To reach this level, 600 new
plants were to be put into operation, and existing plants were to be
improved and modernized. Announced figures on increases in capital
investment in the building materials industry which were accomplished
by mid-1954 indicate that fulfillment of the over-all 5-year goal of
the Fifth Five Year Plan appears improbable. It is estimated that
fulfillment will fall short of the goal by approximately 29 percent.
Plans for production of cement, one of the key building materials, will
be fulfilled by 94 to 97 percent, and plans for brick production will
be substantially underfulfilled.
In order to compensate for shortages in building materials and
at the same time to strengthen the construction industry, a decree was
issued on 20 August 1954 which established directives and procedures for
expanding the production of precast concrete products in a program
* The estimates and conclusions contained in this report represent
the best judgment of ORR as of 15 February 1955?
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extending through 1957. This decree assigned specific responsibilities
for implementing the program to 22 ministries and 5 major governmental
organizations. Detailed assignments included such things as design-
in@g standard building plans, designing standards and specifications for
the precast concrete products, and producing equipment for use ir. the
precast concrete industry. At the same time, it is planned to ir.crease
production of precast concrete products slightly more than fivefold
between. 1951+ and 1957. Standardized designs, simplified material in-
puts, savings of scarce steel and lumber, and shorter rail hauls will
aid. in.reducing costs of building materials and improve production
efficiency. Soviet prospects of achieving planned goals for the
production and use of precast concrete products are unfavorable despite
the probability of a priority being assigned to this industry. There
have been severe lags in plant construction, and the program seems
overly ambitious in the light of past Soviet experience. Equipment
for these new plants will also pose a difficult problem, particularly
in light of the fact that there have been severe lags in the past in
equipping the comparatively few plants which have been constructed.
Fulfillment of the consumer goods program is unlikely as long as
the current rates of production in such key building materials as
cement and brick continue below planned levels, and all indications
point to the fact that they will continue to be below planned levels
throughout the Fifth Five Year Plan. It is likely that these short-
ages will introduce problems in planning for the balance of the
Five Year Plan, which will be compounded in the next 5-year plan or
bring about significant revisions downward.
In 1951+ there was a general shortage of building materials in
the USSR with the need particularly urgent for increased supplies of
those materials necessary for the construction of housing, agricultural.
facilities, and new plant installations in the light and food ind'astries.
The USSR, aware of this need, issued a decree in August 1951+ on the de-
velopment and production of precast concrete products. Successful plan
fulfillment of construction in the areas of housing, agriculture, and
the light and food industry is dependent to a large extent upon the
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production of building materials and particularly upon the program
for the production of precast concrete products. The importance of
the production of building materials is indicated by a provision for
it in the Fifth Five Year Plan. The Plan calls for an increase of at
least 100 percent in the production of all building materials with
specific items such as cement, brick, and slate exceeding this
increase. 1/*
The building materials industry in the USSR is centered around
the Ministry of the Building Materials Industry, which had 459 plants
subordinate to it as of August 1953. 2/ In addition, production is
also carried on by the Union-Republic Ministries of the Local and
Fuel Industries, the Ministry of Housing and Civil Construction,
industrial ministries, the construction ministries, and enterprises
of local industry and producer cooperatives. 3/ With the exception
of the Ministry of the Building Materials Industry, these organiza-
tions produce the building materials needed in performing their
respective primary missions; so their desire to expand the building
materials program probably would extend only as far as the immediate
needs of their own organizational programs. A list of the principal
producers of building materials and the percentage of plan fulfill-
ment is given in Table 1.**
In regard to the over-all plan fulfillment of building materials
production, Table 1 shows that the targets are being met satisfactorily.
In considering the production of certain basic construction materials
such as cement and brick, a study of Table 2 indicates that diffi-
culties may be experienced in attaining the planned goals of 1954 and
1955.
Cement production, in order to rise to the specified increase of
2.2 times from 1950 to 1955, must be 18.2 percent higher in 1954 than
in 1953 and 18.3 percent higher in 1955 than required in 1954. J The
actual increase for the first 6 months of 1954 was 15 percent over
the corresponding period of 1953, which indicates that the 1955 goal of
22.4 million tons may be fulfilled by 94 to 97 percent.
In order to attain the planned quantity of 2.3 times the 1950
production, brick production will have to increase by about 20 percent
For serially numbered source references, see Appendix B.
Table 1 follows on p. 4.
Table 2 follows on p. 5.
CONFIDENTIAL
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in both 1954 and 1955. It has been indicated that the 1953 brick
production plan was not fulfilled 16 and that the actual increase
over 1952 was only 12 percent. In the first half of 1954 the re-
ported output was 13 percent higher than the corresponding period of
1953. In view of these reports of relatively low increases and.
considering the percentage increases that would be required in 1954
and 1955 to attain the Fifth Five Year Plan goal, it seems apparent
that there will be a substantial underfulfillment of planned brick
production.
II.. Capital Investment.
The level of capital investment in the Soviet building materials
industry in the Fifth Five Year Plan was to be three times the level
of the Fourth Five Year Plan, according to statements in January 17/
and May 1953 18/ by two officials of the Ministry of the Build_ng
Materials Industry. In order to reach this level, 600 new plants were
to be put into operation and existing plants were to be improved and
modernized. 19/
Announced figures on increases in capital investment in the build-
ing materials industry accomplished to mid-1954 indicate that ful-
fillment of the over-all 5-year goal of the Fifth Five Year Plan
appears improbable. It is estimated that fulfillment will fall short
of the goal by approximately 29 percent. Developments in the Soviet
building materials industry during the Fifth Five Year Plan are
shown in Table 3.*
A rise of 20 percent for 1955 over 1954 has been selected as a
reasonable sequence to the 9-, 8-, and 10-percent series for 1952,
:L953, and 1954, respectively. It is also reasonable to assume that
in each year the volume of investment in the building materials in-
dustry is generally in line with the rise in levels for the entire
economy because of the dependency of increased capital constru2tion
on a relative increase in building materials production. Even after
allowing for errors in assigning index numbers to those years for
which complete data are not available and crediting the industry with
relatively large increase in capital investment in 1955, it can be
concluded that the goal for capital investment in the building ma-
terials industry in the Fifth Five Year Plan will be underfulfilled.
* Table 3 follows on p. 7.
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This conclusion tends to be confirmed by criticisms, published iii
Soviet journals and newspapers, of delays in new plant construction,
lack of modernization of existing plants, and an inadequate supply of
production equipment. 27/ Available data on capital investment in
the building materials industry indicate a lag that can be overcome
only through the most strenuous efforts. Such an achievement is made
even more difficult by the already extensive efforts to raise the
over-all levels of capital investment, particularly in the consumer
sector of the economy. That the Russians are going to try to expand
substantially the level of capital investment with emphasis on
one element of the building materials industry is indicated by a
20 August 1954 decree on the precast concrete industry, which is dis-
cussed in the following paragraphs of this report.
III. Precast Concrete Products* Program.
A decree of 20 August 1954 L8/ calls for a major effort in develop-
in4g the precast concrete industry of the USSR. Need for this action
was probably brought about by a survey of the present and future status
of the building materials industry and the construction industry.
A. Benefits. F
A savings in materials and. improvements in the performan2e of
the construction industry are the major benefits stated in the decree.
Considerable savings in the use of lumber and metals, as well as more
efficient and economical use of cement, would be effected. According
to Soviet statements, anticipated savings in construction labor on
projects where precast concrete products will be used may amount to
over one-third the total labor force heretofore required. The reduc-
tion in lumber and metal requirements and careful planning in location
of precast products plants also will decrease the burden on the
transportation system.
B. Magnitude.
Some indication of the magnitude of increases in construction
and the attendant increases demanded for building materials is reflected
in plans to increase investments in the consumer goods program shown
* Precast concrete products include beams, columns, and panels which
are produced in plants and production yards and transported to con-
struction sites.
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in Table 4.* The principal areas of construction in connection with
the consumer goods program are housing, agriculture, and the light
and food industry. Expenditures for urban housing construction were
planned in 1953 at 25 percent more than the 1952 level 29 and in
1954 at 31 percent above the actual 1953 level. 30/ Soviet leaders
have indicated that stepped-up housing construction is to continue
after 1954- 31/ For agriculture, capital investment allocations in
1954 are to increase 75 percent over the 1953 level. 32/ Allocations
for Machine Tractor Stations (MTS's) alone are to total over 10.5
billion rubles in the years 1954-56. 33/ For the light and food indus-
try, capital investment is to be overUO percent higher in 1954 and
1955 than in 1952 and 1953. 34/
C. Intended Uses.
The requirement that the gains in the consumer sector of the
economy were to be accomplished without any reduction in the emphasis
previously placed on heavy industry has caused fulfillment of invest-
ment in construction for the several fields of the consumer sector
to fall short of planned 1954 goals. This is shown in Table 4. In
order to maintain a continuing emphasis on heavy industrial construction,
other means had to be found to fulfill satisfactorily the current con-
sumer goods program outlined in the decrees of late 1953. A decree
published on 20 August 1954 35/ calls for a major effort in developing
the precast concrete products industry as the principal means of ful-
fillment of the consumer goods construction program.
Precast concrete products will be used principally for housing,
industrial installations, agricultural construction, bridges, and
piping. The planned extent of their use is given in Table 5.**
D. Progress of the Program.
Available information on developments in the precast concrete
products industry indicates that unsatisfactory progress has been made
during the Fifth Five Year Plan. It is estimated that in 1950 there
were 25 precast concrete products plants in the USSR with a total
production in the range of 100,000 to 150,000 cubic meters. At this
Tablee ollows on p. 10.
Table 5 follows on p. 11,.
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Planned Soviet Construction Utilizing Precast Concrete Products L2/
1955-56
Year of
Housing
Industry
Agriculture
Construction
(Living Space)
(Building Area)
(Building Area)
1955
5,300
2,813
3,230
1956
9,270
3,767
5,170
Total a/
14,570
6,580
8,400
a. In addition to precast concrete for the above construction,
15,400 linear meters of precast concrete bridge structurals and
3 million linear meters of reinforced concrete pipe are to be
produced during the 1955-56 period.
time there were no clear-cut goals for the development of the indus-
try, 43/ and available information characterizes 1950, 1951, and 1952
as a period of criticism of its performance. Major criticisms were
slowness in erection of new plants, unsatisfactory production levels,
indifference in the adoption of precast concrete products for use in
construction, untimely preparation of construction plans, and failure
to supply plant equipment when needed.
E. Planned Output.
In January 1953 it was announced that the output of precast
concrete products was to be raised to 900,000 cubic meters in 1955
and that the construction of 30 new plants 44/ would make it possible
to increase production to 16.5 times the 1950 level in 1956. 45/
Based on the 1950 estimated production range of 100,000 to 150,000
cubic meters, the 1956 output would range from 1.65 million to
2,475,000 cubic meters. It would appear that the decree of 20 Aug-
ust 1954 was announced as a result of increased emphasis on the con-
sumer goods program, continued priority on building materials for
heavy industrial construction, and unsatisfactory fulfillment of the
precast concrete production program. 46/ This decree listed the
shortcomings of previous programs and remedies therefor and listed the
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ministries and departments responsible for implementation of the new
program. It also listed production goals, products to be man-Lfactured,
principal users of the products, and ministries responsible for con-
structing and equipping the plants necessary to fulfill the planned
goals of this decree.
The planned total production of precast concrete products
under the new program is shown in Table 6.
Planned Soviet Production
of Precast Concrete Products 47/
1954-57
Planned Production
Year
(Thousand Cubic Meters)
1954
1,860
1955
3,515
1956
6,085
1957
9,790
In order to achieve this production, 402 factories and 200
production yards are to be built during 1955 and 1956. Capital in-
vestment in the precast concrete products industry is to be increased
by 3,30 million rubles in 1954; total capital investment in the pre-
cast concrete products industry is planned at 1.725 billion rubles
in 1955 and 2.160 billion rubles in 1956.
F. Organizations Involved.
Twenty-two ministries and 5 other major organizations will
participate in the program, according to the decree of 20 August
1954. 48 The broadcast role will be played by the State Committee
for Construction Affairs of the Council of Ministers, USSR, which
will have the responsibility of overseeing the implementation Df the
decree and of reporting on its progress to the Party's Central Com-
mittee and to the Council of Ministers, USSR.
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The five ministries that will be most deeply involved in the
program are the Ministry of the Building Materials Industry, the
Ministry of the Construction of Metallurgical and Chemical Industry
Enterprises, the Ministry of Construction, the Ministry of Construc-
tion and Road Machine Building, and the Ministry of Ferrous Metallurgy.
The Ministry of the Building Materials Industry will receive
the major share of increased capital investment funds in 1954 and
probably a very large share of the total investments for the 2
following years. It is called upon to do research in improvement of
materials, help work out specifications for products, help on the de-
sign of producing plants, submit a proposal for improving the utili-
zation of existing plants, work on the improvement of production
equipment, and perform several other assignments.
The Ministry of the Construction of Metallurgical and Chemical
Industry Enterprises is to receive additional funds for new plants
this year to help in the designing of precast products plants, draw
up designs for standard 1-, 3-, and 5-story buildings which will
utilize precast concrete products, contribute to the publication of
instructions on the use of precast concrete, and perform several
other assignments.
The Ministry of Construction is to participate in the acceler-
ated investment plan for 1954, both in connection with construction
for the Ministry of the Building Materials Industry and the Ministry
of Construction and Road Machine Building and with the construction of
plants for its own trusts, and it will participate in a limited
number of assignments mentioned for the Ministry of the Building Ma-
terials Industry and the Ministry of the Construction of Metallurgical
and Chemical Industry Enterprises.
The Ministry of Construction and Road Machine Building is to
enlarge or remodel 5 of its plants for the manufacture of equipment
for precast concrete plants and will assist 10 other ministries on
problems of equipment design and manufacture.
The Ministry of Ferrous Metallurgy is to produce 70,000 metric
tons of reinforcing wire in 1955 and 150,000 metric tons in 1956. It
is also to prepare for the production of an unspecified amount of
wire rods.
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Most of the 21 ministries involved in the capital investment
program for precast concrete products will build precast plants for
the use of their own construction organizations. Almost all the min-
istries that have their own construction organizations are listed as
participants. The list includes the Ministry of the Aviation Industry,
the Ministry of the Defense Industry, the Ministry of Defense, and
the MVD. The Ministry of Ferrous Metallurgy, the Ministry of the
Chemical Industry, and several of the machine-building ministries were
not included, probably because the major share of their construction
requirements are contracted out to the Ministry of Construction and
the Ministry of the Construction of Metallurgical and Chemical :Industry
Enterprises.
Of the 11 ministries participating in the designing and man-
ufacture of technological equipment for precast concrete production,
5 are in the capital goods field, and 2 are in the field of defense
industry. The leading role in the manufacture of equipment will be
played by the Ministry of Construction and Road Machine Building. The
two organizations in the field of defense industry are the Ministry of
the Shipbuilding Industry and the Ministry of the Defense Industry.
G. Implementation of the Program.
A survey of the precast concrete products program up to the
issuance of the August 195+ decree indicated that during the Fifth
F:Lve Year Plan considerable, although unsatisfactory, progress had
been made in terms of new plants and increases in total production.
It also indicated that serious difficulties were encountered in the
construction of new plants, organization of the comparatively new
industry, and promotion of the use of its products in construction.
Cognizance of these and other shortcomings in this industry is dem-
onstrated by the amount of space in the August 195+ decree devoted
to criticisms of its performance. With the aim of eliminating the
lag in the development of production and the use of precast concrete
products in housing, industrial, and agricultural construction, 27
regulations were decreed by the Central Committee and the Soviet Coun-
cil of Ministers on 20 August 1954. )+9/
CONFIDENTIAL
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 Approved For Release 1999/09/02 : CIA-RDP79-01093A000900040002-4
Three factors favorable to the precast concrete products
program are (a) strong backing of the Party and of the Council of
Ministers; (b) close connection between the success of the precast
concrete program and the success of the Soviet consumer sector pro-
gram; and ~c) the possible savings of materials, manpower, time in
construction, and the reduction of transportation requirements.
A summary of Soviet experience indicates a rate of pro-
gress in putting new plants into operation and a utilization of pre-
cast concrete products that has enabled them to show considerable
progress in absolute terms, but, relative to the requirements of the
newly announced decree, this past performance appears to be inadequate.
The construction of such a large number of plants and production yards
may be delayed by the lack of standard plans which are to be drawn,
approved, and published by February 1955? It has also been directed
that further research be done to determine the most suitable precast
concrete manufacturing equipment to be installed in the new plants.
Since this task must be accomplished in a relatively short time, it
is unlikely that it will be completed as scheduled. Difficulties may
be encountered in adequately supplying component materials such as
reinforcing, aggregates, and high-quality cement, 50/ since numerous
complaints have appeared in the press in regard to the supply of these
components in the previous program which was much smaller. 51/
3. Prospects for Fulfillment.
Based on the strong backing of the Party and government
and the emphasis placed in the closely related consumer sector program,
great efforts will be made to fulfill this ambitious program. The very
rapid increase in rate of expansion, however, will be very difficult
to maintain, particularly in view of the fact that many drastic
changes in policy, planning, and supply are immediately necessary.
Underfulfillment can be expected during 195+ and 1955, but, with the
continued strong interest and assignment of high priority, fulfillment
may be achieved by early 1957.
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CONFIDENTIAL
APPENDIX A
METHODOLOGY
The figures for the yearly increase in the USSR in production of
cement, the index of production, and the actual production are shown
in Table 7.*
The cement production figure fixed by the Fourth Five Year Plan
was fulfilled by 97 percent. 52/ Output of brick and tile did not
fully reach the Fourth Five Year Plan goal. 53
It is inferred from the failure to state the explicit degree of
underfulfillment of the Five Year Plan goal for brick that the target
was missed by a substantial margin. Since the cement plan was an-
nounced as 97 percent fulfilled, it is inferred that the underful-
fillment for brick was greater than 3 percent.
It is impossible to state the exact degree of underfulfillment.
Arbitrarily a figure.of 6.5 percent is selected.
Planned production for 1950 was 9.6 billion units. 5I/ Output
in 1950 is then assumed to be 0.935 x 9.6 billion, or approximately
9 billion units.
Table 8** shows the yearly rate of increase in the production of
brick, an index of brick production, and the estimates of brick
production.
* Table 7 follows on p. 18.
** Table 8 follows on p. 19.
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 Approved For Release 1999/09/02 : CIA-RDP79-01093A000900040002-4
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