April 15, 2011

Russia projects 2011-12 grain export up to nine million tonnes

Russia could export up to nine million tonnes of grain in 2011-12 if the harvest hits 84 million tonnes, the director of the Institute for Agricultural Market Studies (IKAR) said Thursday (Apr 14).

He warned that growing problems in the key Volga region could hurt output.

The Kremlin banned grain exports last summer after the worst drought in more than a century slashed the harvest by around a third to 63 million tonnes. But speculation has been building in the industry that the government may soon lift the embargo due to falling internal prices and hopes for a bumper 90-million-tonne harvest later this year.

IKAR's Dmitry Ryklo said that although officials are concerned over how to finance the storage and insurance of the upcoming crop and bodies have been lobbying to lift the ban, no consensus has been reached.

"Nobody knows, not even our government," he said. "There are several plans inside the government and it's difficult to say what would be the end result to allow exports right now."

He pegged Russian grain output at between 80,079 tonnes and 88,085 tonnes, that included between 18,416 tonnes and 20,424 tonnes from the Volga region. However, he warned that the current estimate of 16% winterkill in Volga is likely to be raised "as nothing is showing in some regions".

"What Volga produces will be a large factor in determining the size of the harvest," he said.

IKAR projects stocks at the beginning of December 2011 will total 15,000-18,000 tonnes, compared with the official estimate of 12,564 tonnes left at the same time last year.