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Russia Lifts Ban One-Year on Grain Exports


An employee sweeps up grains in a warehouse in the the village of Konstantinovo, some 60 km (37 miles) from the Southern Russian city of Stavropol, June 7, 2011

An employee sweeps up grains in a warehouse in the the village of Konstantinovo, some 60 km (37 miles) from the Southern Russian city of Stavropol, June 7, 2011

Russia, once the world's third largest wheat exporter, is returning to the international grain market after a one-year gap caused by severe crop losses.

Moscow stopped selling wheat last year after catastrophic fires and drought destroyed one-third of the country’s crop. The Kremlin banned exports to assure there would be adequate grain supplies for the domestic market, but this year's crop was better than expected, and foreign sales of Russian wheat are resuming.

Andrei Sizov is an executive at SovEcon, an agricultural consulting firm in Moscow that focuses on market news from Russia and the surrounding region. He is confident that this year’s Russian harvest will result in millions of tons of surplus grain for export, but says it may be difficult for the country to regain its stature in export markets immediately.

"We expect that total Russia grain export will be around 15 million tons, maybe some more," said Sizov. "It will depend on demand and world prices."

That export forecast depends on a total Russian harvest of 85-90 million tons of grain this year. Based on rainfall in May and June, meteorologists do not expect a repeat of last year’s drought conditions.

Yuri Khramtsov, manager of a farm in the Kursk region, expects a strong crop this year.

Depending on the weather, he says, average Russian wheat harvests range from 3 to 4.7 tons of grain per hectare.

This year, Khramtsov says, favorable weather conditions will ensure his farm's yield will be over 4 tons per hectare.

Russian officials say they intend to monitor domestic conditions closely as the country's exports increase. If prices start to rise at home, they say they have six million tons of grain in reserve to stabilize prices.

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