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2007 September 26   14:47

Economics ministry to impose export duty on grain by December 1

Russia's Economic Development and Trade Ministry plans to impose export duties on barley and wheat by December 1, the director of the ministry's macroeconomic forecasting department said Wednesday according to RIA Novosti.

"The draft of a relevant government resolution is ready but has not been submitted," Andrei Klepach said.

He said the ministry plans to introduce a 30% export duty on barley and 10% on wheat, which would mean they would both cost around 22 euros ($15.5) per metric ton.

"The aim [of introducing duties] is not to ban, but to limit export volumes," Klepach.

German Gref, the previous economic development and trade minister, over the past two months repeatedly spoke out in favor of introducing grain intervention as soon as possible. He described bread prices and the situation on the grain market as a major threat to the government's inflation target of 8%.

However, the need to introduce grain intervention was not so obvious. Kommersant, a respected business daily, said earlier that grain prices had reached a record level of 6,300 rubles ($250) per metric ton of class 4 wheat and 5,700 rubles ($226) per metric ton of forage fodder in July 2007. Prices of bread, flour and other wheat-based food products also grew as a result.

But early in September Agriculture Minister Alexei Gordeyev said it would not be necessary to launch grain intervention before late November, until after preliminary results of this year's harvest have been assessed.

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