Russian grain export curbs would put the country’s exporters at risk of default, while such a measure in 2010 was counter-productive because it resulted in stockpiles and forced the country to sell at a discount the next year, according to Gautier Le Molgat, an analyst at Paris-based farm adviser Agritel.
Economy Minister Andrei Belousov said today Russia may curb grain shipments should prices keep rising.
“It’s normal that someone who seeks to contain inflation puts the emphasis on the cost of food,” Le Molgat said by phone today.
“They’re in the World Trade Organization now, so they have to pay a little bit more attention than in the past. And they’ve seen in 2010 that this step was almost counter-productive, because at the end of they year they’d built up big stocks. Their clients dropped them and the next year they had to sell at a big discount.”
“For it to make a difference, it has to be put in place quickly, because Russian export activity is very high at the start of this year. In any case we’re expecting export activity to ramp down in the coming weeks. It’s hard to see how the Russians will supply the export market in the second half if they have the harvest that’s now expected.”
“It would be counter-productive, because it would put exporters at risk of default.”