IKAR in Mass and Industry Media

Russia Probably Won't Set Grain Export Duties for Now, Ikar Says

Bloomberg

June 8 (Bloomberg) -- Russia probably won't impose grain export duties until at least September after the condition of the harvest is better known, according to Oleg Sukhanov, a grain analyst at the Institute for Agricultural Market Studies.

The 10 percent average increase in prices since May 28, when the government announced its export ban would end, is ``normal,'' Sukhanov said. Russia will act to prevent domestic prices from rising when the export ban is lifted, First Deputy Prime Minister Viktor Zubkov said on state television on May 25. ``There will be no duties until at least September, if at all,'' Sukhanov said. ``We don't think prices will keep rising by the same amount for all the month.''

Third-grade milling wheat, used to make bread, in parts of Russia rose as much as 19 percent to 6,400 rubles ($231) a metric ton in the first week after Russia announced the end of the export ban, according to the Grain Producers' Union, a farmer group. The Institute for Agricultural Market Studies, known as Ikar, forecasts domestic wheat prices will stay between 6,000 to 6,500 rubles a ton for the marketing season that starts July 1, Sukhanov said. The export ban ends July 1.

Russia probably won't export more than 4 million tons of grain in July, said Natalia Zagvozdina, an analyst at Renaissance Capital in Moscow. They may not even exceed 1.5 million tons, according to Sukhanov. ``The prices in fact stood at such minimal levels a month ago that the 10 percent increase should not harm anybody, including meat producers,'' Zagvozdina said. ``The ban on grain exports was lifted especially to support Russian farmers.'' Russia has more than 6 million tons of grain in government stockpiles and ``if there will be issues related to inflation, we will take measures of customs and tariff regulation,'' Zubkov told Prime Minister Vladimir Putin on May 28.

02.07.11

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