Russian grain producers oppose export duties

Russia’s union of grain producers is opposed to the Central Bank’s move to introduce grain export duties as a lever against inflation, the union’s president, Pavel Skurikhin, said on Wednesday.

Earlier this month, Central Bank Chairman Sergei Ignatyev proposed temporary floating duties on grain exports to prevent possible inflation after the government lifts on July 1 a year-long ban on grain exports introduced over last summer’s severe drought.

The Economic Development Ministry backed Ignatyev’s idea but the Agriculture Ministry was not impressed. Last week, a source in the ministry said that such export duties “would only be justified if global grain prices soared.”

“As a grain producer, I cannot be positive about this. Such a measure will only give extra support to cattle farmers who are in a fairly good position anyway,” Skurikhin said.

Meat and dairy producers are the main grain consumers on the domestic market.

Skurikhin said that the expected growth in grain prices after July 1 would not automatically raise bread prices. He added that grain made up only 25% of the bread cost.

“I don’t see any reason for higher grain prices to affect the inflation rate. I think it is some invented scare, which vulgarly simplifies the situation,” he said.

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