April 6, 2011
 

Cereal prices to be affected by Russian cereal export ban

Flour milling firms will have to prepare themselves for high commodity prices for a while to come.

Russia has declared that it will lengthen its existing export ban on cereals for a few months yet.

The country's government is trying to make sure that it has sufficient wheat, corn and barley to meet its own local needs, after bad weather conditions gave rise to a poor harvest.

"We are not expecting to export any grain from Russia this year," an analyst said.

Without exports from Russia, flour milling firms can anticipate the cost of cereals, which have already hit their highest levels in two years, to remain high as supplies decline.

However, more positive news came from UN food agency the Food and Agriculture Organisation recently.

It said that there is a favourable outlook for wheat output in 2011, which could bring about lower prices.