Open

Coming up

Don't miss

Replay


LATEST SHOWS

TOUR DE TECH

Read more

AFRICA NEWS

Ebola death toll increases in Sierra Leone

Read more

MEDIAWATCH

Finally, a good use for new app "Yo"

Read more

TALKING EUROPE

Viviane Reding, MEP, European People's Party

Read more

TALKING EUROPE

Schulz returns to Parliament presidency: back to business as usual?

Read more

WEB NEWS

Trash collection goes high tech

Read more

WEB NEWS

Web users react to escalating violence in Gaza

Read more

FASHION

Paris, Haute Couture Fall/Winter 2014-2015.

Read more

REPORTERS

Exclusive: an unlikely victim of the 'War on Terror'

Read more

  • Germany defeat Argentina 1-0 to win fourth World Cup title

    Read more

  • In pictures: 2014 World Cup historic moments

    Read more

  • Clashes erupt in Paris as thousands march to support Palestinians

    Read more

  • Paris’s Bastille Day fireworks ‘a homage to victims’ of WWI

    Read more

  • Thousands flee northern Gaza after Israeli warning

    Read more

  • Major differences remain as deadline looms in Iran nuclear talks

    Read more

  • Rival Libyan militias exchange heavy fire at Tripoli airport

    Read more

  • French military to extend Mali 'counterterrorism' operations into Sahel

    Read more

  • Legendary conductor Lorin Maazel dies aged 84

    Read more

  • Germany’s Tony Martin wins ninth stage of Tour de France

    Read more

  • Boko Haram claims Nigeria attacks and supports Iraqi militants

    Read more

  • French court lifts mayor’s ban on Muslim hijab at beach

    Read more

  • Shells land in Russia as eastern Ukrainians flee fighting

    Read more

  • Iraqi parliament fails to agree on new leadership

    Read more

Business

Russian ban on grain exports comes into force

©

Text by News Wires

Latest update : 2010-08-15

Russia has begun a ban on the export of grain until the end of this year in a bid to keep the domestic market supplied and put a lid on prices after a record drought caused a massive loss of wheat crops.

AFP - A ban on Russian grain exports ordered by Prime Minister Vladimir Putin came into force on Sunday, with the government battling to keep down prices of basic foodstuffs amid a record drought.

According to a government decree signed by Putin on August 5, the ban will extend from August 15 up until December 31, although the powerful premier has indicated it may even extend beyond that date if the harvest is bad.

Russia, the world's number three wheat exporter last year, has already warned that its grain harvest this year will be just 60-65 million tonnes, compared to 97 million tonnes in 2009.

The drought amid the worst ever heatwave in Russia's history has ruined one quarter of the country's crops, according to President Dmitry Medvedev.

The export ban is aimed at keeping the Russian domestic market well supplied with grain to prevent sharp rises in prices. Russia's leaders, acutely nervous of social unrest, will be keen to avoid any discontent over food prices.

"We must not allow an increase in domestic prices and must preserve the headcount of our cattle," Putin said bluntly as he announced the ban.

Last year, Russia exported 21.4 million tonnes of grain and had even embarked on a major new campaign to boost its international market share, an ambition that now must be set aside for some time.

Russia requires 78 million tonnes of grain domestically and can cover the shortfall with 9.5 million tonnes from a state fund and 21 million tonnes left over from last year's harvest, the government has said.

Medvedev acknowledged last week that both market participants and ordinary people were worried about "how this extraordinarily hard summer would affect the prices of the most basic foodstuffs."

He vowed the authorities would not allow grain prices to rise and would keep a close eye on costs for food products such as flour, bread, meat and milk.

The export ban from such a key global player stung world wheat markets, sending prices to two-year highs and sparking worries of a crisis in global food supplies.

Putin has shrugged off the controversy, warning that the ban could even be extended. "There is no need to count on a quick removal of the export ban," he said, adding that anyone waiting for December 31 was doing so "in vain".

There has been criticism of the ban even within Russia, with some players saying it will take the country years to regain its international market position and risks driving domestic grain producers out of business.

In contrast to the tough talk of the prime minister, Medvedev admitted that producers had been put in a difficult position. He said they should be helped so they can prove they had no option but to comply with the ban, allowing them to claim 'force majeure' when they fail to meet contracts.

"We have put producers involved in exports into a difficult position," he said. "Having done this, we must help them have the legal proof that (there) was a force majeure and it was not possible to fulfil deliveries."
 

Date created : 2010-08-15

  • RUSSIA

    First planeloads of US aid to combat wildfires arrive in Moscow

    Read more

  • RUSSIA

    Ban on wheat exports sends global prices skyrocketing

    Read more

  • RUSSIA

    A quarter of country's crops lost in heatwave, Medvedev says

    Read more

Comments

COMMENT(S)