July 30, 2012

 

Russia's grain harvest cut to 77-80 million tonnes

 

 

The Russia's Federal Service for Hydrometeorology cut its 2012 forecast for grain harvest to 77-80 million tonnes from 83-86 million tonnes.

 

"We have completed calculations of grain and legume harvest and of certain crops in both categories … The forecast stands at 77-80 million tonnes, 7-10 million tonnes below a five-year average and about 15-16 million tonnes less than in the previous year," director of Russia's Federal Service for Hydrometeorology, Alexander Frolov said.

 

Deputy Agriculture Minister Igor Manylov said that the drought damaged about 4.4 million hectares of the sown area, or 6% of the total. According to the Agriculture Ministry, the Southern, Volga, Urals and Siberian federal districts were hit the hardest.

 

Frolov said that the forecast is still higher than the one for 2010, when a drought killed a third of the country's crops.

 

"The situation is bad, we cannot bring any good news to you, but on the other hand it is good that there is no scenario similar to what we saw in 2010 because that year was dramatic for the agriculture and for a great number of people," Frolov said.

 

The Agriculture Ministry bases its forecast on the forecast of the Hydrometeorology Service. The ministry cut the projections to 80-85 million tonnes earlier in July from 85 million tonnes.

 

Prime Minister Dmitry Medvedev ordered Deputy Prime Minister Arkady Dvorkovich to support farmers that suffered from the drought, including grain interventions.

 

Dvorkovich said the government will decide on grain interventions in some regions next week.

 

Agriculture Minister Nikolai Fyodorov said that the ministry will only intervene in regions, where the grain deficit is the heaviest. "I do not see any necessity for massive interventions," he added.

 

Fyodorov also said that the government might cover drought losses borne by regions with subsidies.

 

The government intervened on the market between April 4 and June 7, selling 2.2 million tonnes of grain for RUB11.88 billion (US$370 million). The grain fund's reserves are now at 4.858 million tonnes.