The Russian Grain Union announced on the need for pre-term cancellation of the current export duties on wheat, which expire on June 30, 2015, informed the corresponding letter of the Russian Grain Union sent to Dmitry Medvedev, Prime Minister of the Russian Federation.
According to the letter, the current situation on the Russian grain market significantly changed compared with the end of January and early February 2015, when the customs duties on wheat exports were imposed.
The RUR/USD exchange rates actually stabilized, the wheat export rates decreased, and got kept at the level of previously concluded contracts, the domestic market was completely provided with the required grain resources, grain product prices continue reducing, noted the letter.
According to the Russian Grain Union, by the end of 2014/15 MY grain surpluses on the market may exceed the level of 5 mln tonnes, as a result of the export duties. Most grain reserves will be concentrated in the export-oriented Southern Federal District. Some grain surpluses will be sold to the public intervention fund, but the fund will not be able to completely sterilize the market, said the letter.
Due to the difficult macroeconomic conditions and low availability of credit resources, such situation can only mean one thing - "disincentive effects to agricultural producers to increase grain production".
According to the experts, possible cancellation of the export duties and selling of the accumulated grain surpluses from the southern Russian regions, could enable agricultural producers not only to quickly get the required funds for seasonal agricultural works, but also to give an opportunity to make new contracts for grain supplies.
