August 26, 2010

Ukraine not restricting grain exports

The Ukranian government has said it is not necessary to limit grain exports.

Wheat prices rose last week when officials there warned that they would have to impose quotas. A severe drought and extreme heat has led to poor harvests across Russia and neighbouring countries.

Deputy Prime Minister Viktor Slauta said that there were currently "no grounds to limit grain exports."

However, reports suggest that Ukranian customs continue to unofficially block grain shipments.

When Russia announced its ban it led to fears of global shortages and pushed wheat prices to their highest levels in almost two years. Earlier this month the USDA cut its outlook for world wheat production after sharply revising down its crop forecast for Russia. However, world wheat inventories still remain above crisis levels seen in 2007-08.