Russia seeks more grain exports in 2010-11

Russia will try to raise its grain exports in the 2010-11 crop year starting on July 1 by offering low prices, as it needs to shift its growing stocks, the head of the country's grain lobby group said on Monday (May 18).

Russian Grain Union president Arkady Zlochevsky noted that the next crop year will be a year of expansion of the Russian presence on the world grain market. Russia will have record carry-over grain stocks of 26 million tonnes by July 1, compared to 22.6 million tonnes a year ago, he added.

Zlochevsky did not give a forecast for the volume of exports for the 2010-11 crop year. The union estimates exports in 2009-10 at 21.6 million tonnes including 18.1 million tonnes of wheat and 2.5 million tonnes of barley.

"In 2002, when nobody expected us in the world grain markets, we managed to export 17 million tonnes of grain because of lower prices. There is no other way of conquering markets," he said.

Zlochevsky confirmed his previous forecast of Russian grain production in 2010 at 95-97 million tonnes which, weather permitting, could exceed 100 million tonnes. The wheat crop may be around 60 million tonnes, which is close to last year's levels, he said.

"We may therefore have record grain resources," he said, adding that Russia will not yet be able to increase domestic grain consumption next year despite developing its poultry and animal breeding.

He also said that Russia will face acute competition with exporters from the European Union, which will be in a better position than Russia because of the declining euro currency.

In addition, the union will keep lobbying for the introduction of subsidies to be awarded to grain exporters on a tender basis, he said.

"We are raising again the issue of awarding export subsidies of RUB10 billion (US$332.3 million)," he noted.