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Page added on December 29, 2014

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Russia to add wheat exports duty

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Russia will introduce a duty on wheat exports from Feb. 1, the government said, adding to other restrictions with which it is battling a rise in domestic grain prices.

Russia, expected to be the world’s fourth-largest wheat exporter this year, has been exporting record volumes from a large grain crop of 105 million tonnes as the ruble’s plunging value has spurred a dash for foreign currencies.

But last week, Moscow imposed informal export controls, including tougher quality monitoring and slashed railway loading programs, in a bid to cool domestic prices while also unveiling plans to impose a duty on exports.

The government said late on Thursday the duty on wheat exports would amount to 15 percent of the customs price plus 7.5 euros and would be no less than 35 euros ($43) per tonne from Feb. 1 until June 30, 2015.

Trade sources expect business to become more difficult.

“The level of the duty technically allows exports from Russia’s south,” a trader said.

“But shallow-water ports are still blocked by informal restrictions and it would be impossible to export all volumes until February, so exporters will bear large losses.”

State-controlled Russian Railways called off its controls on grain railway loading on Friday, but said it planned to raise its tariff for these supplies by 13.4 percent from Jan. 24.

The duty on wheat should help to lower domestic wheat prices by 15 percent so the government can replenish its grain stocks, the head of Russia’s Grain Union, Arkady Zlochevsky, told Interfax news agency.

The government is ready to buy third-class wheat at 10,100 rubles ($186) per tonne, while the current market ex-works price is 11,225 rubles, down 200 rubles compared with a week earlier, according to SovEcon agriculture consultancy.

Zlochevsky, the head of the influential farm lobby group, expects exports to be small in January due to informal export curbs which remain in place.

“One of the key unknowns is whether the government will keep artificial administrative barriers or lift them starting from Feb. 1,” said Dmitry Rylko, the head of IKAR consultancy.

 

reuters



9 Comments on "Russia to add wheat exports duty"

  1. Makati1 on Mon, 29th Dec 2014 7:49 am 

    Looks like the Russians will be well fed in this economic war. Not that that was in question.

  2. dissident on Mon, 29th Dec 2014 8:24 am 

    The government doing its proper job. Those that want dollars and euros so much should all bugger off to the USA or the EU and grow their wheat or resell it there. Some numbskull’s fetish for foreign currencies should not be tolerated when it creates a false shortage situation due to excessive exports.

  3. JuanP on Mon, 29th Dec 2014 10:09 am 

    This is an obvious defensive move on the part of Russia’s government and a very smart move. It is wise for a country to fill its granaries when facing foreign agressions. Another reminder that Russia can cover all its economic needs with its domestic production.

    My heart goes out to the people of Egypt and other countries where wheat and bread will become more scarce and expensive leading to increased poverty, hunger, and starvation.

    I keep reading a lot of BS in MSM, but even considering loss of their currency value or coming economic recession, I see Russia better prepared, more self sufficient, stronger and more united every day.

  4. radon1 on Mon, 29th Dec 2014 2:09 pm 

    That’s why this is unrewarding to be a farmer in Russia – the very moment you take breath after years of hard work and austerity, the goblinment comes in and crashes your business.

  5. Kenz00 on Mon, 29th Dec 2014 4:57 pm 

    Even the people of Russia can not depend on Russian politicians (Putin)………

    Europe needs to wake up and see that Russia is not a reliable partner or supplier of anything.

    Europe needs to diversify its energy sources and types and move to local energy production and local jobs. Wind, solar, wave energy and geothermal can all be produced in Europe and provide much needed local jobs.

    Renewable energy prices keep dropping making them look better every day.

    ———————-

    Dizzying Renewable Energy Price Declines Can Help States Meet Ambitious Carbon Targets Under The EPA’s Clean Power Plan

    http://www.renewableenergyworld.com/rea/news/article/2014/12/dizzying-renewable-energy-price-declines-can-help-states-meet-ambitious-carbon-targets-under-the-epas-clean-power-plan

  6. Makati1 on Mon, 29th Dec 2014 6:42 pm 

    radon1, do you truly own your home/farm/land? If you live in the USSA, you do not. You owe taxes every year on any land you think you own. Try not paying them for a few years and see if the government lets you stay there.

    Ditto if you have a mortgage. The banks will take it from you eventually, if you cannot make the payments plus interest. They would rather let it rot empty than let you not pay.

    Americans do NOT own their homes. They rent them from their government/bank.

    Perhaps true land ownership in Russia is rare, but at least they are not under the delusion that they do.

    Russia will not be conquered by the West. People forget that they lost about 26.6 million people in the 2nd world war. That is about 15% of their population.

    The US lost ~420,000 or 0.3% of the US population then. (The Philippines lost twice as many or ~6% of their population in WW2.) America does not know what war is like … but soon will, I’m afraid.

  7. GregT on Mon, 29th Dec 2014 7:12 pm 

    Geez Kenz,

    Been waiting for what seems like an eternity to see the upgrade to Kenz400, and you downgrade to Kenz00.

    Time to get with the program.

  8. dissident on Mon, 29th Dec 2014 7:40 pm 

    For every farmer that wants to use Russian soil for growing an export product, there is one who will not be such a two bit opportunist. That is why the gubbermint imposes taxes and regulations to control rabid speculation and follow national interests. I could care less how rewarding some speculator finds their racket.

  9. JuanP on Wed, 31st Dec 2014 10:46 am 

    Putin’s 2014 overview speech to government in English.

    http://eng.news.kremlin.ru/news/23438/print

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