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Government promises not to limit export of grain

March 20, 2012, 11:47 UTC+3

Viktor Zubkov said during a meeting with Vladimir Putin that now Russia is ranked third among major grain producers

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MOSCOW, March 20 (Itar-Tass World Service) —— Russia’s First Deputy Prime Minister Viktor Zubkov said on Monday during a meeting with Prime Minister Vladimir Putin that now Russia is ranked third among major grain producers. Thus no limitations will be introduced for further export of grain. However, the weather may hinder the promising forecasts from the officials.

The deputy prime minister reported that by July 1 the country’s crops of grain would make 15 million tonnes, the Rossiiskaya Gazeta wrote. This amount would satisfy the entire domestic demand, and thus the deputy prime minister believes the situation in the market is stable. The prices are acceptable – at about 5,500-5,600 roubles a tonne. The export of grain has reached 22 million tonnes. It would be possible not to introduce any limitations of further supplies, which may reach 27 million tonnes.

The Novye Izvestia writes that according to Zubkov, exporting companies may sign contracts for April, May and June. The world prices for grain are most high now, and forecasts for the crops are optimistic. However, in spring of 2010 nobody could expect the draught might ruin a third part of the crops. That caused introduction of embargo on export of Russian grain and almost pushed Russia from the international markets.

This year, grain growers plan to collect 94 million tonnes of grain, the Komsomolskaya Pravda writes. Or even 100 million if the weather conditions are favourable. The frosts in early winter are not likely to affect it, Russia’s Grain Union said. However, too big crops are not playing in farmers’ hands. Compare: in the record 2008 the industry collected 108 million tonnes of rye and wheat, the prices slump almost by a half, and many agricultural producers suffered losses.

In autumn, as the embargo on grain export was lifted, Russia began exporting record amounts of grain, and then Zubkov started talking about necessary barriers for food movement not to cause higher prices in the domestic market, the Moskovskie Novosti writes. The plan was that as the export reaches 23-24 million tonnes, the government introduces actually banning export duty. The Ministry of Economic Development failed at that time to offer a mechanism.

Russia’s Grain Union is sure the country may export even 30 million tonnes without damaging the domestic market, the Union’s Vice President Alexander Korbut told the newspaper. But with the alignment of the domestic and world prices, it would be realistic to export not more than 26.5 million tonnes. Zubkov reported that Russia had exported already 22 million tonnes of grain. On Monday, immediately after the meeting with Putin, he participated in opening of a new grain terminal of 500,000 tonnes capacity in Astrakhan’s Olya Port. The newspaper writes that the biggest consumer of Russia’s grain is Iran.

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