UPDATE 3: Russian ministry wants to lift wheat export duty till July 1

(Adds details in 12th, last paragraphs)

MOSCOW, Aug 19 (PRIME) -- Russia’s Agriculture Ministry has suggested cancelling the wheat export duty until July 1, 2017, but the government has not yet made a decision, Vladimir Volik, head of the ministry’s agriculture markets regulation department, told reporters Friday.

Russia imposed a wheat export duty on July 1, 2015, which is measured as 50% of the price minus 6,500 rubles per tonne, but at least 10 rubles per tonne.

“We have submitted proposals to the government, but we are not discussing the matter, and I can’t say right now whether it will happen or not. We are not talking about abolishing the export duty, but about cancelling it until July 1, 2017,” Volik said.

Currently, the duty has no impact on the grain market, he said.

EXPORT FORECAST

Russia’s grain exports in the current agricultural year, which ends on June 30, 2017, may reach a record of 40 million tonnes, with wheat exports rising to 26–30 million tonnes from 24.604 million tonnes exported in the 2015–2016 agricultural year.

“Our forecast is certainly higher than last year’s. We expect that we may reach even 40 (million tonnes of grain),” Volik said, adding that “wheat (exports may reach) 26–30 million tonnes.”

RECORD HARVEST

The Agriculture Ministry said in a statement that Russia may harvest a record 113–116 million tonnes in 2016 if the weather remains favorable.

“Preliminary estimates show that Russia will harvest a record grain crop in 2016, which will amount to at least 110 million tonnes, but it may grow by another 3–6 million tonnes if weather conditions remain favorable,” the statement read.

Previously, the Agriculture Ministry expected the grain harvest to rise to 106–110 million tonnes in 2016 from 104.8 million tonnes in 2015. On Monday, Prime Minister Dmitry Medvedev said Russian farmers harvested 70 million tonnes of grain as of August 12, which is an almost 33.3% increase on the year and a possible sign of a record harvest in 2016.

INTERVENTIONS

Volik said that the ministry plans to purchase up to 1 million tonnes of grain from farmers until the end of 2016 and 2 million tonnes for the entire 2016–2017 agricultural year.

“The amount will surely stand at up to 1 million (tonnes), we are adjusting the figure now. They (interventions) will be held occasionally until the end of the calendar year…We are aiming at 2 million tonnes until the end of the agricultural year,” Volik said.

The ministry said in a statement that it plans to buy 600,000 tonnes of grain until the end of 2016 and up to 2 million tonnes of grain in the current agricultural year.

Volik said that the ministry does not plan to change purchasing prices for grain during interventions, as it has to support non-exporting regions and the price is defined by regulations coordinated with the Federal Antimonopoly Service, he said.

He also said that the ministry may launch milk interventions in 2017 if the necessary legal framework is prepared for that.

As of August 12, the grain intervention fund consisted of 3.257 million tonnes of grain worth 28.837 billion rubles.

(63.5487 rubles – U.S. $1)

End