August 13, 2010

Russia's government is prepared to give further support to farmers, in addition to the grain export ban and inventory release already announced, according to reports.

The export ban set to come into force this weekend, and the expected release of some thee million tonnes of grain from state stockpiles should lead to a stabilisation of prices in the domestic market, said Cherkizovo's chief executive Sergei Mikhailov.

However, this was unlikely to prove the limit of Moscow's willingness to support growers and livestock producers should the current measures fail to calm prices, he added.

"In the event of sustained extraordinary grain price increases, we reasonably anticipate that the government will intervene with additional subsidy measures for grain and livestock producers," he said.

Russia has made the support of the domestic livestock industry a priority of its agricultural policy, to cut down on huge reliance on foreign meat. The country ranks top among importers of chicken, and second in pork.

Cherkizovo, the country's biggest meat producer, cited lower chicken imports in the first half of this year, after Russia banned supplies from the US on health grounds, as key to an 8% rise to 99,860 tonnes in sales from its poultry division in the first half of the year.

Pork sales jumped 75% to 37.160 tonnes, boosted by extra capacity, while sales of processed meats rose 8% to 66,200 tonnes.