Russian Agriculture Minister Alexey Gordeyev says 1.5 million tons of grain could be used for interventions.
Photo: Grigoriy Sobchenko
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Agriculture Ministry to Add Export Duties to Wheat Interventions
Export duties on grain are to supplement interventions on the market in 2007 and 2008, Russia’s Agriculture Minister Alexey Gordeev last weekend. Russia last took such strong interference steps on the grain market in 2004. This time, the market may be shut down for foreign trade before a winter price hike.
“It is only natural that the state is introducing an export duty when it enters the market with sales,” the agriculture minister said but did not specify the duty’s rate or schedule.
Trade interventions were last combined with 25 percent export duties in winter 2004. This time, the two measures may be combined in summer or fall. Alexey Gordeev said that the Agriculture Ministry is in no hurry with interventions but is “all ready” for them. The minister added that 1.5 million tons of grain could be used for interventions.
Grain prices went up more than 10 percent in July due to low harvest forecasts and world price growth. A rapid introduction of export duties, quotas on wheat export and grain interventions may be fueled by the situation in Kyiv. Ukraine, which is comparable to Russia in terms of wheat exports, has introduced almost zero quotas on most grain exports, virtually opening a several million ton market for Russian exporters. It means Russia’s 1.5 million tons may be exported without changing the domestic situation.
Minister Gordeev noted that Russia would be ready to interfere in grain pricing in case the prices were to outpace inflation. Inflations came to year-on-year 5.7 percent in the first half of 207 while bread went up an average 4.7 percent nationwide.
www.kommersant.com
All the Article in Russian as of July 16, 2007
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