October 9, 2007

Russia submits wheat, barley export duty proposal

The Russian Trade and Economic Development Ministry has submitted a draft decree to the cabinet providing for an increase in the export duty on wheat and barley, Economic Development Minister Elvira Nabiullina said Monday (October 8), the ministry's press office said.

The Russian government is concerned over the current increase in the rate of inflation, which is threatening to exceed the planned 8 percent this year, and the ministers see higher agricultural products prices as the main reason.

Nabiullina said Monday in her report to President Vladimir Putin that increasing demand from the fast-developing economies of China and India, as well as the recent cuts in government subsidies to farmers in the European Union, had contributed to rising prices of agricultural products.

She said that one of the ways to keep prices down at home was to impose higher export duty on grain.

Officials said earlier the ministry was proposing to impose a 10 percent wheat export duty and 30 percent barley export duty in November.