July 13, 2012

Russian farmers urge government to relax grain railway transport tariff

Pavel Skurikhin, union's president, told reporters Thursday (July 11) that the government has been asked by Russia's National Grain Producer Union to ease tariffs for railway transportation of grain and grain products.

Russian grain shipments via railways are currently qualified under the second tariff class, which suggests relatively cheap cargoes with an 8-15% share of transportation costs included in the final price.

"We have presented an initiative to shift the grain into the first tariff category. It will help reduce transportation costs, as well as raise preferential conditions in respect of downtime cost, the terms of railway cars delivery and passing," Skurikhin said.

Under the first tariff class, Russia ships cheap raw materials and energy freights with over 15% of transportation costs included in the final price.

"It means granting higher status for grain transportation," Skurikhin added.

The union also asked the government to resume reduced railway tariffs for grain deliveries from Siberia and the Urals.

Speaking about Russia's accession to the World Trade Organisation (WTO), Skurikhin said Russia may boost its support for lands unfavourable for agricultural development under the so-called green basket plan - a package of state support measures permitted by the WTO.