February 23, 2012

 

 

Unless the United Nations bans it, Russia has no plans to stop grain exports to Iran, Artem Krestyaninov, deputy director of the Ministry of Agriculture, said Wednesday (Feb 22).

 

"It is highly inhuman and pointless to limit and constrain foodstuff shipments [to Iran]. They aren't weapons," Krestyaninov said on the sidelines of an international grain conference.

 

Iran has recently turned to exporters in Australia, Canada, and Russia, among other countries, to secure grains such as wheat and corn and aggressively replenish its stocks. Iran's efforts are largely due to concerns about the latest international sanctions against it and what may come next in its dispute with the West over its nuclear programme.

 

Australia may export more grains to Iran due to sanctions imposed by the US and the EU over Iran's disputed nuclear programme, Alan Winney, chairman of the Emerald Group, one of Australia's biggest wheat exporters, told Dow Jones Newswires earlier this week.

 

Many grain exporters and shipping companies are concerned about Iran's ability to pay them because of the sanctions' restrictions on the international banking sector's business with Iranian banks. However, Russian exporters so far haven't experienced any problems receiving payment for their grain shipments to Iran, Krestyaninov said.

 

"There isn't any problem with payments and I hope this will continue," Krestyaninov said.

 

Payments to Russian exporters are made through irrevocable lines of credit into Russian bank accounts in US dollars, so the exporters aren't experiencing any difficulties, Arkadiy Zlochevsky, president of the industry group Russian Grain Union, said on the sidelines of the conference.

 

Russia generally exports around one million tonnes of grains, mostly wheat, to Iran annually, but volumes are likely to rise this year, Zlochevsky said. Russia isn't likely to impose export taxes on grains because supplies are sufficient, Krestyaninov said.

 

Russia's grain inventories will likely total around 15-18 million tonnes as of June 30, the end of the marketing year, which would be roughly the same as last year, Krestyaninov said.

 

Russia has decided to export 27 million tonnes of grains this marketing year without levying export taxes, he said. It has already exported 20 million tonnes. Russia's grain output is estimated at 94 million tonnes this year, up from 61 million tonnes in 2010-11, Krestyaninov said.

 

Output will likely top 90 million tonnes in 2012-13 due to an increase in planted areas by 223,000 hectares, he said.