19 August 2010, 13:00
Exporters from South of Russia cannot sell grains because of embargo and transport fees
From August 15 on, Russia officially bans any export of grain crops; this decision resulted in material losses of most of the market actors. Exporters lost their market shares, and grain producers lost their profitable contracts. Rostov agrarians are going to hold their grains till the last moment, waiting for exports reopening. However, only financially sound enterprises can afford it.
The heavy drought, which struck many regions of the country, has aggravated the confrontation of grain consumers (cattle breeders, millers and processors) and producers. The former want to buy cheap, while the latter want to sell high. However, while Central Russia sees its main problem in deficit of wheat, the country's south has the excess of it. Having spent millions of roubles to grow the crops, producers are now unable to sell them. According to the Ministry of Agriculture and Foodstuffs of the Rostov Region, in 2010 the Region will yield at least 6.6 million tons of grain, and some 4-4.5 million tons could be freely exported.
According to Victor Borodayev, Director General of the "Tselina" (Virgin Soil) Company, the ban on exports just shocked the market: "Although two weeks have expired, every morning starts with talks about the ban. The market has fallen off; no sales are made. This year we gathered over 100,000 tons of grain crops, but managed to sell only one third of it. Almost 65,000 tons of high-grade wheat is still in grain elevators."
Author: Ilya Guseinov Source: CK correspondent
