December 28, 2011

Russia may stop buying grain from markets as prices rise

Russian government may suspend purchasing grain from the markets of certain regions as prices continue to increase, according to the Agriculture Minister, Yelena Skrynnik.

The ministry has registered hikes in grain prices in the Urals and Siberian federal districts, Skrynnik said without providing exact figures.

Under the interventions, the government has acquired 279,000 tonnes of grain with the limit set earlier at 1.5 million tonnes, Skrynnik said, adding that the terms of purchasing depend on the volume of offers from agricultural producers.

"Nowadays, the supply volume is shrinking," Skrynnik said.

The government launched purchasing interventions on the grain market on November 29 at between RUB3900 and RUB5000 (US$124.3 and US$159.3) per tonne. The government plans to sell the purchased grain back to farmers in January-May 2012.

On December 20, Deputy Agriculture Minister Alexander Petrikov said that domestic agriculture companies had gathered 92 million tonnes of grain in net weight in 2011.