By Vestnik Kavkaza
In the modern economy grain exports are considered to be an indicator of the economic strength of a country, the ability not only to provide its own population with food and national food security, but also export significant volumes of products abroad for improvement of its national interests, according to experts. This year weather conditions during the harvesting campaign contributed to a record-breaking grain harvest in Russia. According to Arkady Zlochevsky, the head of the Russian Grain Union, “at the moment there are 75 million tons of grain in Russian storages. Meanwhile, only 54% of fields have been harvested.” Zlochevsky thinks that it will be the second harvest in modern Russian history since 1991 of more than 104 million tons. The record-breaking harvest was in 2008-2009, when the volume of grain harvest was 108 million tons.
Speaking about providing internal agricultural resources, Zlochevsky said the situation was stable. “The only problem is unusual price reduction. At the moment we can see a slight growth due to changes in the currency exchange rate. The exchange rate plays its role; it has changed the internal balance between internal prices and export parity rate. At the moment the loss under the export parity rate is $10 from 1 ton in Central Russia. Of course, this cannot last for too long, the situation will improve if the ruble doesn’t weaken in comparison with the dollar. If it is stable, then the internal process in Central Russia will reduce. The Volga Region’s prices are correlated with the export parity rate at the moment, its prices are lower than in Central Russia,” Zlochevsky says.
As for supporting farmers, according to the head of the Russian Grain Union there is no need for this in the south of Russia. “These regions are export-oriented, they will export all surpluses abroad. The only region where Russians should be supported is Crimea. Crimea is isolated from the international market, even though its export potential is huge and it has surpluses. Its grain cannot be transported to Russia because they need to use either Ukrainian territory or sea transport, but it is very expensive and creates a lot of problems,” Zlochevsky says, “As for the international market, they can’t use it due to sanctions and the non-recognition of Crimean territory as a Russian region by many countries. I believe Crimea should be supported, as its grain is blocked inside the region.”
