Russia and Kazakhstan seek to create joint grain exchange

Russia and Kazakhstan are in talks to set up a joint grain exchange, according to Russian Deputy Agriculture Minister Alexander Belyaev.

Along with the creation of a new trading floor, Russia will build a new grain terminal in the Far East and expand opportunities for rail shipment of grain to reduce tariffs for grain producers, he said.

The deputy minister stressed that one of the main tasks is the opening of new markets for Russian grain producers.

Belyaev recommended Siberia's grain producers to focus on grain exports to Vietnam, Cambodia, North and South Koreas, India and Japan.

''For a long time the government has not seriously focused on exports and nobody tackled this problem as the existing grain output was small. At present, we have one serious terminal in Novorossisk and several sea-river terminals. There are no large grain trading companies,'' he said.

Belyaev confirmed that the idea of grain quotas is being discussed at the federal level, but no effective mechanism has been found so far.

''Russia's single quota is around 36 million tonnes of grain. If we divide this figure by all crop areas, we will have around one hundred kilograms per hectare. On the other hand, we annually import around two million tonnes of meat, eight million tonnes of milk and food. If we calculate all this and take into account how much grain we need for the production, we will get another 20 million tonnes of grain, i.e. a total of 56 million tonnes – and we can speak about quota arrangement,'' he said.

Belyaev added that it is extremely important for Russia to develop the National Union of Grain Producers to boost trade on foreign markets, as this association conducts all talks on the European and Asian markets. He recommended farmers to cooperate with this organisation more closely.